The Middle Management AI Crunch

We’ve all heard the predictions that AI is going to take the place of junior programmers and entry level marketers. Will it keep climbing its way up the corporate food chain to take the jobs of middle management as well?

Or are middle managers actually well positioned to stave off the threat of AI job loss? Stick around and find out. Hi, I’m Courtney Baker, and this is AI Knowhow from Knownwell, helping you reimagine your business in the AI era.

As always, I’m joined by Knownwell CEO, David DeWolf, Chief Product and Technology Officer, Mohan Rao, and NordLite CEO, Pete Buer. We also have part two of Pete Buer’s discussion with Dr.

Pia Lauritzen, about the real existential threats of AI, and why we should all spend more time asking questions. But first, Pete Buer joins us as always to break down the business impact of some of the latest and greatest in AI news.

Pete Buer joins us again. Hey Pete, how are you?

Hey Courtney, I’m good. How are you?

Doing good. Pete Wired just ran a story about scientists using AI to dream up bizarre experiments, some of which actually worked. What’s your read on this one?

You know, Courtney, many times we come across a great article or maybe a book that’s been written by a guest on the show.

It seems to have a great compelling interest in and of itself for our audience. And often, I’ll recommend to listeners to chase it down and go deep. This is not one of those articles.

Unless, of course, you’re familiar with the Laser Interferometer Gravitational Wave Observatory and or want to know more about some of the astrophysics and detection of gravitational waves work that goes on there on a regular basis.

But of course, we’ve chosen this article because there’s good learning for us. Turns out these physicists are tasking AI with a really curious job, proposing experiments that no human would have thought of.

Stuff that looks strange on paper, but when tested produces valid, useful, replicable results. The machines are becoming collaborators, creative collaborators and scientific discovery. So what are the takeaways?

Most business leaders see AI as a tool for automation and cost savings. It’s a reality that’s further reinforced by the studies suggesting that ROI from AI is coming mainly early days from the efficiency plays.

This research helps us remember that AI can play a really important role in growth and forward-looking innovation, uncovering approaches that the humans on the team might not come up with on their own.

The implications for me at least, one, as a business leader, think differently about your impact measures. Cold, hard, financial ROI, of course, has to be fundamental to your business planning, but it doesn’t explain everything.

It’s not always the answer to investments that you make. To that end, to keep some powder dry for pursuing the wacky stuff.

I know we’re always as business leaders working with constrained resources, but sometimes you have to set aside a little something so that you can experiment with stuff just to see what happens. And a third, keep the humans in the loop.

The article reminds us that even with the most compelling, interesting outcomes in these experiments that have been teed up, the AI hallucinated and produced outputs that the scientists first thought were being sent to Earth by aliens, they could

make so little sense of them. And that went on for quite some time until they wrestled the thing to the ground, made sense of it and imposed human judgment on the outputs that the machines provided.

Well, I don’t know about you, Pete, but I immediately am thinking about asking an LLM this question for my use cases. What great marketing experiment should I try that no human has thought of before?

I think it might yield some really thought provoking ideas. So I hope for everybody listening, maybe you could try it today too.

We’ll expect to hear back from you.

That’s right. Pete, thank you as always.

Thank you, Courtney.

So much of the discussion around AI in the workplace focuses on the impact AI will have on jobs. Today, we’re going to look at AI’s impact on middle managers. Will it replace them?

Will it reshape their roles? Will all middle managers be pulling four-hour work weeks in the future, ala Tim Ferriss? I sat down with David and Mohan recently to find out.

David, Mohan, AI is changing the shape of organizations. And one area I’m fascinated to see evolve is AI’s impact on middle management.

Actually, just last week, I was talking to another CMO, and they were talking about a marketing team that was four people. Big firm, four people. So you know what they didn’t have?

They didn’t have any middle management. AI is increasingly able to handle more strategy, reporting, coordination, even performance feedback.

I do know a CEO on this call that has asked AI for some performance feedback before, which are all the very assignments that define many mid-level roles. So what happens to the leadership pipeline?

So we’ve heard a lot about AI evaporating entry-level jobs. And now we’re talking about middle management. Is this trend just gonna keep working its way up the corporate food chain?

David, do Mohan and I need to get worried? What do you think?

You know, I think it’s really interesting to process this and really look at it. One of the trends that I’m seeing is that experts in a certain area are able to leverage AI as their workforce now and get more productivity.

There’s no doubt about that.

I think there’s an interesting question of, does that mean that we’re truly getting rid of middle management, or is it actually the practitioner middle managers that no longer have to manage people, they’re actually managing an AI workforce?

I would love to see some research on that, to bring it to the technology world. I’m not sure it’s the senior software engineer or is it the tech lead that is actually orchestrating these agents and managing that agentic workforce?

And I think the ramifications may be slightly different. What I am worried about is what you’re alluding to here, which is I don’t know that I have a picture yet for how career progression in the early ages comes on, right?

AI is able to undoubtedly do some of the rudimentary work that entry level positions historically have had. How are you going to be an apprentice and learn what you need in year five, six, and seven of your career or 10, 11, and 12 of your career?

Have you never had the opportunity to do one, two, and three? I think that is an existential question. I think it will be solved.

I think every other time we’ve gone through this phase, we figured it out. But I do think it’s where the major disruption is going to come, more than just removing middle managers.

I think what you’re going to see is an elevation of folks, and it’s the removal of that entry level position is my personal perspective.

So do you think with entry level positions, we’ll just have to do kind of like an Ender’s Game scenario, where they just go in and just, they work but they’re not working, and then they get deployed in.

But maybe they are working sometimes, but we don’t tell them, you know.

Well, first of all, the cultural reference of the Ender’s Game, I don’t even know what that is. So you’re going to have to educate me here. David!

Oh, God, it’s a classic.

I’ll send you the book. It’s coming your way. Mohan, you know Ender’s Game?

I don’t know what Ender’s is.

Gosh, all of the listeners out there, they’re like, David, Mohan.

Okay, it’s sci-fi, but it’s a classic. So, okay, you didn’t get that pop cultural reference, and that’s okay. One day you will continue on.

So, you think it’s really, it’s not going to be middle management. You think it’s going to be this entry level layer that it’s…

Yeah, and I do think, I think what you allude to there without knowing the cultural reference is, I think the apprenticeship world may be coming back a little bit where we have lost it, where we have moved to this systematized education versus

working in the trenches with somebody and learning from somebody. I think that could be an interesting solution.

I also think you’re going to see a lot more entrepreneurship and people depending on the artificial intelligence for deep experience and expertise that they don’t have, but they bring something else to the table in just the vigor and the

entrepreneurial spirit and a vision and those types of things. And so you could see everything invert a little bit. So there’s a lot of different ways this could play out.

I don’t know that there are enough signals to show us one is definitively going to play out or another, but that’s where my brain goes.

Overall, I love this framing because it forces us to be precise about what AI might be displacing.

If you think about what middle management has always been, it’s been about coordinating information, tracking progress, delivering reports, giving feedback, and sometimes real leadership as well.

We’ll talk about what real leadership means in a second. I think it’s all of the administrative management, I think largely will be taken care of AI as we go along.

But there is a human aspect here of that middle management leadership that is going to be even more important as we go along.

It’s about dealing with the nudges that you have to make as humans to each other to get somebody to a higher level performance and keeping customers in mind while you’re building something, or whatever it is.

I think that’s going to be an essential part that’s going to remain. I don’t buy into middle management will disappear, but it’s going to be maybe fewer of them, fewer of us. It could be a different type of job definition.

But I think middle management will be there, but it’s going to be different with less administrative drudgery and more human type of work, but also be able to skilled in delivering whatever it is that you’re working on.

So I think it’s going to take a different shape. I’m seeing this already, if there’s an early indication with software engineers. Three years ago, I could not have imagined what these tools can do, how much code they can write for you.

It doesn’t mean that your director or VP of software engineering is going to disappear unless they were just doing the coordination work.

If they were also producing code and shaping the product, I can see those types of people being even more valuable in the future, even if there are fewer of them.

David, coming back to where you were going, if this next generation of middle management leaders were not like what we all went through, meaning we don’t even know what their new life is, but whereas we were in a different era than we were in middle

Can I chime in here for a second?

Because I actually think about this all the time with my kids. So my nine-year-old, I’m thinking about the world. I cannot even imagine the world that she will be going into as a young adult.

The only thing, we’re over here working on adding and subtraction. I’m in my head like, this kind of feels useless. Like what I should be working with her on is critical thinking.

How do I turn you into a critical thinker? It’s like the one thing I can go back to and say, this I am sure you will need as an adult. I’m not so sure you really need to know eight plus seven.

I mean, she does, but she doesn’t. You know what I’m saying? And so I’m even thinking about that right now at home with my kids.

Yeah.

I’m glad you said that, because what’s going in my head is that there needs to be a framework for us to think about this. And I do think it goes back to first things, right? First principles.

And Mohan, to your question, I don’t think we’re going to be teaching people exactly all of the perfect skills and the ways to go about things and how to navigate a career like we probably have for the last 30 years.

I think what we’re going to be teaching is some underlying principles. Critical thinking is a great example, right? How to build relationships.

You mentioned before, Mohan, how to lead. There are different skill sets that are much more human and innately human than just the surface area skills of work.

And I think this may be a renaissance, actually, that calls us back to these first things, instead of just repeating tactics and route behaviors that have proven to get us successful in a career before.

Well, and let’s just be totally transparent. They haven’t been teaching marketing in colleges in a very long time. You talk about apprenticeship coming back.

That would actually be incredible. Most marketers that come out of college, they don’t even know what a CRM is. You have no context for the very foundational tool that marketers use.

I mean, it’s just kind of mind-blowing. So in some ways, blowing all this up in a not dramatic way, but reframing all of this, I think could be really good for everybody in the long run, even if it’s painful in the short term.

Totally.

Yeah, I agree with that. I think strategic clarity is always going to remain an important topic. Empathy is always going to remain an important topic no matter what the tools are.

Complex decision making, that’s life or death in some industries. Could be sort of always the realm of the human domain. So yeah, these are all, I agree with you.

I think the best answer right now is you can go back to the first principles and then rework the leadership journey.

Well, David, Mohan, this is a really interesting conversation for everybody listening. I hope you got some good ideas.

Maybe you can reply in our comments on LinkedIn to give us some thoughts on what you think is most important for us to be training up the next generation of leaders. Thank you as always, guys. Did that weird.

Thank you as always. David, Mohan, thank you as always. Thank you.

The more I enjoy, the weirder I get.

We’re used to it now.

The new era of commercial intelligence is already here. If you’re interested in having real-time objective intelligence on the health of your commercial relationships, you might be interested in trying out Knownwell.

Stop flying blind, start sprinting ahead. Go to knownwell.com/experience to set up time to speak with the Knownwell team. Dr.

Pia Lauritzen is a philosopher, keynote speaker and author of five books. She writes a regular column for Forbes, asking big questions about tech and transformation.

This is the second part of Pia’s conversation with Pete Buer on the real existential threats of AI and how to think about them in the business world.

I wonder if there isn’t a role or a duty in the future for boards of directors to prompt the questions and tee up these issues alongside a shareholder value creation.

I think so.

And then I think, I definitely think that some of it will come by itself because we already saw that the first ones firing people to and using AI agents instead, now they are starting to hire again some of them because it was just, well, we were

wrong. We couldn’t just let go of all these people we need. We need when customers call or customers have problems or clients need something, they expect another human being.

They too, as I mentioned before, want to be touched or want the eye contact or want. So they will go with the company that can offer that.

So I think it’s just them again, it’s not happening simultaneously, but some of what looks like first runners now might not be the ones who will take the market.

You’ve referenced the three E’s, three things that should never be left to AI. Can I ask you to tell us what they are and why it’s important that AI not to control them?

Yeah, so they are based on the study of 2,400 years of philosophy, right?

So going back to Socrates and up until now, what are the main topics that philosophers throughout history have been, the questions they’ve been asking themselves over and over again. And it seems like they don’t even care that much about the answers.

They only care about keeping asking the questions. And these are the existential questions. So these are the questions about who are we, why are we here as humans and as individuals.

The second kind of questions are the ethical questions. So what is good?

So we also talked about that before, you know, transcending this discussion of good and bad use of technology and actually just saying, okay, let’s ask the question, what is good? Instead of just saying, we will use technology for good.

Yeah, but we are not having this discussion about what is good. And maybe we need to have that discussion before we build technology that is supposed to get us there.

And the third E and the third big kind of questions is the epistemological questions. So these are the questions about how do we know? And how do we deal with what we don’t know?

So these are very important in times of AI where we have misinformation, fake news, we have deep fakes, we have all this kind of, we have these discussions that has to do with us not being able to trust what is presented to us.

So we need to be very good at asking, but how do I know for sure? Is this something I can trust? And what if I cannot trust this person I think I’m talking to?

What if it is a machine? Would I behave differently? And how do I make that part of my decisions and part of my behavior?

And the reason that these three big E’s should never be left to AI, we shouldn’t ask AI these kinds of questions, is that all of these questions, we have a lot at stake. So it makes a big difference for us, whether we exist or we don’t exist.

It’s the difference between life and death, right? It’s a big difference.

When it comes to what is good and what is bad, if I make a bad decision, you know, the ethical questions, if I make a decision not to act in accordance with what society considers good, then I can be alienated.

I can be, you know, I can be pushed out of society. People don’t want to talk to me. They don’t want to be my friend anymore.

So that makes a big difference. And it’s the same, of course, with the epistemological questions. If I trust the wrong things, then I will be deceived.

I will be misled, and I will be unable to trust my surroundings. So it makes a very big difference to us, these questions, but it makes absolutely no difference to AI.

To AI, there is no difference between these big questions, these big decisions that we need to make. So we should trust each other to have these kinds of conversations.

When we have these questions, we need to find the gut or the courage to actually ask another human being. Because they will be the only one who can reflect the consequences of making the wrong decision. AI will never be able to help us with that.

I’m led to think about organizational culture and the role that leadership plays in facilitating conversations with these kinds of questions at their heart.

I think something has to change in business, right? Where these conversations are happening, it’s kind of happening outside in the world with you at a podium.

I don’t think it’s happening day to day between an employee and their manager or the manager and the VP of the department or whatever. So how do we get to a new place on driving the right kind of dialogue and asking the right kind of questions?

Yeah, so I actually think that there is a very concrete and very practical approach to that.

That’s why I spent 15 years or something like that building technology because what I realized when I did my PhD studies was that we have built systems and structures and technologies that we use in society and in companies that does the exact

opposite of what we need. We need people to be asking each other questions about some of these big ease questions, but also all kinds of questions, all other kinds of questions.

Because as I mentioned in the beginning, it’s when we ask questions that we learn and we connect in different ways and we see opportunities and are able to solve problems, we would otherwise not be able to solve.

It’s extremely important that we enable people to ask each other questions. But all the tools we have, all the technologies we have do the opposite. If you think about surveys, they are designed for people to respond.

Not to ask their own questions and not to connect with each other, but just to respond on a scale from one to five. How do you think about this and this and that?

If you think about polls, opinion polls in society, if you think about interviews, focus groups, whatever you use when you’re trying to understand and help an organization or a community evolve, all the tools you use are based on this idea that

people should only be respondents. They should just respond to whatever the leader or the expert have in mind. So what I did is I said, okay, that’s what I want to do. I want to democratize the power of questions.

I want to build technology that enables people to ask each other questions and make it easy for people to use the tool and for people to look at the data afterwards.

So afterwards, you can actually see what are the kind of questions we’re asking in this team or in this organization. Do we ask a different kind of questions or do we all have the same mindset? We always ask, how do we do this?

How do we do this? Or do we have people in the culture who say, but why are we doing this right now? Would it be better to do something else or who do we expect to benefit from us doing this?

So mapping, what is the question culture? And how can we evolve as an organization or develop as an organization by forcing ourselves to ask different kinds of questions?

It’s not like I’m not one of those questions experts saying, always ask five why.

So always ask, I’m saying, let’s look at the question culture we have, because if we know what’s going on in our organization, then we can challenge ourselves by asking a different kind of questions. So that’s what the technology are built.

One is called Question Jam and it’s actually free. It’s a seven minute game. So people can just use it on questionjam.com.

So for seven minutes, you can have a group of people engage by asking each other questions, and then you get a word cloud showing. So you can click on the questions and the answers.

You can see what kind of blind spots do we have, and how do we help each other ask a different kind of questions.

I know this is not as philosophical or high-level executive language for how to change these things, but it’s a practical way of saying, we can do little things differently that will make a big difference in how we help each other ask more questions.

The high-level stuff doesn’t drive results as well as the pragmatic, you know, just go do it. So can I ask, I realize we’re getting to the end of our time, but I wonder if I can ask one more question.

What have you noticed about the difference between running a group dialogue that’s focused on asking questions versus answering questions? What kind of different takeaways are you coming up with?

So when you have a group of people that feel comfortable asking questions, it’s very closely connected to Amy Edmondson’s research on psychological safety. It makes it easier for people to spot where we need to focus in order to improve as a team.

So if you don’t have access to the collective curiosity or the collective skepticism and doubt, these are all things that has to do with questions, right? Wonder, doubt, skepticism, curiosity, creativity.

If you don’t know what kind of questions people are asking, you are not making room for people to share if there’s something that’s going in the wrong direction or if people are running in different directions.

But if you actually do know what are the questions people are asking, you can actually make decisions as an executive team and as a group and as a team.

You can make decision that has to do with aligning people on solving the most important problems first. Because now everybody knows that we were focusing on these five things, but if we focus on this first, then we can go through the others next.

Then it simply increases productivity. At the same time, people feel more comfortable and happy because they are part of solving real problems.

That is, problems they themselves think are real, and not just something they’ve been told from the outside, from a consultant or someone like me saying, I think this is important.

But they realize themselves that this is what we need to do, and then they’re more motivated to actually do it.

I feel like we could go on for hours, but we don’t have the luxury, unfortunately. I know you’ve got things to get back to. Can I just say thank you so much?

It’s been a pleasure and an honor to have a conversation together.

Me too, Pete. It was a great pleasure. Thank you.

Thanks as always for listening and watching.

Don’t forget to give us a rating on your podcast player of choice. At the end of every episode, we like to ask one of our AI friends to weigh in on the topic at hand. Hey Claude, today we’re talking about the middle management AI crunch.

How do you see AI impacting the role of middle management in the years to come?

I think middle managers are going to feel the squeeze as AI handles more of their routine coordination work. But the ones who focus on coaching people and navigating organizational dynamics might actually become more valuable than to eat at Arch.

Now, you’re in the know. Thanks as always for listening. We’ll see you next week with more AI applications, discussions, and experts.