Thanks to AI, the traditional Corporate Orgchart, a triangle of neat power between top executives and junior workers and executives, is creating a quiet revolution.
In Moderna, at HR and Tech, they live under the same roof, overseen by one key person and a digital officer. At another AI First Healthcare company, a team of 10 software engineers has been replaced by three-person units overseeing AI agents. At Amazon, the middle management layer is stripped as part of a broader push towards a more lean, AI-ready structure.
AI is more than just a new tool for the modern workplace. It is quietly restructuring the way businesses organize.
Call it “great flattening.”
As business leaders compete to integrate AI across operations, entry-level roles are disappearing, management layers are thinning, and traditional team roles are beginning to blur. Throughout the Fortune 500, middle management is just as hit as entry-level workers, but even the C-Suites have new power dynamics working as the old pyramid structures of corporate life begin to flatten.
The high-tech boss wants to promote the vision of AI automating job drag. Or, as Microsoft's Satya Nadella said earlier this year, “I think I'm working with my colleagues with AI.”
While ideas from a taskless world like editing Excel spreadsheets and sorting files sound great in theory, what does an AI-first organization actually look like?
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One of the key themes of organizations pivoting into the “AI-First” structure is a type of “flattening” corporate structure, essentially meaning less management oversight, removing junior and support roles, and increasing reliance on AI systems to handle tasks previously handled by human employees.
It could also mean collapse or fusion of traditional team structures.
For example, pharmaceutical company Moderna recently appointed Chief People and Digital Technology Officers to integrate technology and HR departments into a single function and oversee both teams. According to the Wall Street Journal, the move was partly attributed to Openai's partnership with the company to help support HR support and handle junior roles.
At consulting giant McKinsey, the company deploys thousands of AI agents to support consultants in tasks such as building decks, summarizing research, and verifying argumentative logic. In addition to this, approximately 40% of the company's revenues now come from advice on AI and related technologies.
“For AI-first organizations, these AI agents can essentially do a lot of the organization's execution work,” said Nick South, managing director and senior partner at Boston Consulting Group. luck. “And when organizing processes and delivery processes around this AI-native workforce, the role of humans is different.”
This is because the nature of individual duties changes as tasks are automated by AI tools or agents.
“The roles of our work will be dismantled because some tasks may be new in AI and others, so their meaning may change,” says Eva Selenko, professor of work psychology at Loughborough Business School. “It may be a little less in one role, but that person will take on another function from another.”
This does not mean that the entire job will be exchanged, but it could mean that employee roles will become more diverse and that regular duties, or even regular teams will take on tasks. As tasks are automated and their importance in the organization changes, the roles of duties will be dismantled, Serenko said. As a result, strict divisions between teams can begin to blur.
Mix all of this with some AI agents performing autonomous tasks, traditional organizational charts begin to look dramatically different.
“Now we're moving into this flatter network of human teams overseeing AI agents,” said Rob Levin, partner at McKinsey & Company.
“In early examples, we see that a client company building an agent factory that supports multiple business workflows can manage around 50-100 AI agents with just two or three people,” he said.
As an example, Levin said the healthcare company replaced the traditional 10-person software development team with a much smaller three-person unit. These consist of product owners, software engineers who can effectively encourage AI coding tools, and systems architects who ensure integration with the company's broader technology ecosystem.
However, these types of major structural changes are more likely to be implemented in smaller organizations and startups, rather than in large companies with more complex structures.
Middle Manager Light
One way companies in the high-tech sector, particularly those trying to simplify and flatten their structure in the AI era, is to cut down on employees at the management level. For example, Palantir CEO Alex Karp announced in a revenue call Monday that he intends to grasp 500 roles from his 4,100 staff. He called it a “crazy and efficient revolution.”
Middle managers employ a lot of FLAK, especially from those of the leading technology CEOs, such as Andy Jassy, who said that middle managers can hamper speed, ownership and innovation on Amazon, especially in the context of AI-driven organizational change.
Jassy is currently aiming to pursue a flatter company structure on Amazon, remove layers and streamline decision-making by increasing the ratio of individual contributors to managers.
But the experts said luck Organizations should not count intermediate managers yet.
“One obvious possibility [of flatter organizations] Tristan L. Botelho, Associate Professor of Organizational Behavior at Yale Management School, said:
However, AI could change the way middle managers work, but Botelho doesn't expect it to disappear completely.
“I don't think middle management will be erased. I think it's just redefine how managers think about their role within the organization,” he said. “One of the things I often talk about with executives is this kind of idea that AI is integrated with the organization.
In the age of AI, soft skills have also become increasingly important, with intermediate managers serving important HR functions. Employees still need to be managed, and the workforce still needs to function with empathy. Organisations risk losing their best performers.
“There's a human side to things,” said Stella Pachidi, senior lecturer at technology and work at Kings Business School. “It's not sustainable to have only bosses as an algorithm. It won't work in the long run.”
In contrast to the big technology narrative, some experts say that management classes expand within traditional organizational structures as automation replaces low-level work.
Nick South of BCG said luck Typically, the run-level job at the bottom of the ORG chart will be first in the chopping block for AI agents, but the management or “orchestration” level increases complexity and importance.
“In the orchestration class, we need to be bigger than we do today, and there is that important human part.
“When you think of the classic middle manager profile, it's like the skill set of a general manager. But what these people need in the future is because they combine the core skills of logic, ethics, rhetoric and communication skills, along with the combination of AI proficiency enough to manage the human agent workforce. “The role of these orchestrations will therefore be very complicated.”
New c-suite
Middle managers and entry-level employees may feel that they are bearing the brunt of the AI burden, but these changes will soon reach the top.
AI is already shifting C-Suite power dynamics to create new powerful, executive-level jobs. According to a 2023 casting research on AI priorities, 11% of medium to large companies have already appointed “Chief AI Officers” (CAIO), while 21% are currently in the recruitment process for this role.
According to a 2023 report on AI in the Workplace on LinkedIn, companies with “head of AI” status around the world have more than tripled in five years, up 13% since 2022.
Alex Connock, a senior fellow at Oxford University's Business School, observed the growth of these roles firsthand.
“When we first launched AI for business programs a few years ago, it was probably relatively rare, but now there are a lot of people. luck. “It's the new mainstream. The level of interest transcends all levels, from 20-year-old undergraduates to veteran executives. ”
For example, there is some debate as to whether these roles stand the test of time, but experts say that these roles may lack clear purpose or authority, but executive levels are not affected by the AI boom.
South said that the rise of some of these roles is not a direct need for this work, but a symptom of our immaturity with AI, but that C-Suite must take on new responsibilities in the AI era.
“People are very nervous about missing the boat,” he said. “I think it's interesting to see how this evolves over time… When things settle, how different is it from a classic Chief Data Officer?”
But here's a new story: “C-suite's responsibility… to think about the competitive situation, the potential source of confusion, how we can protect the source of benefits. These are c-suite questions and it's a mistake to somehow leave it when we hire a Chief AI executive. This is truly the top level thing.”
Although AI is set up to disrupt organizations at all levels, Selenko pointed out that the management structure is likely to protect top people from too much disruption.
“In an influential management structure, if the top job is partially feasible by AI, they won't give up on that power. So you'd think this change in power balance is probably more likely to be in the organization's strong positions,” she said.
