AI hollows out middle managers to transform companies from Pyramids into Barbells

No one really knows what the workforce of the future is supposed to look like, but tech leaders at The Wall Street Journal Leadership Institute’s Technology Council Summit in New York on Tuesday made it clear they’re on a mission to figure it out.

Businesses are starting with flatter teams that include fewer middle managers and reimagining workforces around skills and capabilities rather than mere head count. Meanwhile, the tech leadership at the top is overseeing a broader swath of responsibilities than ever before as they attempt to integrate Artificial Intelligence (AI) across all work functions.

“We’re going to have to rewire the whole company,” said Sastry Durvasula, Chief Operating Officer at financial services organization TIAA, speaking at the event. “Every role, what do they do? What’s the workforce of the future?” He added, “I believe that 80% of the jobs will change at least 20% by AI. And 20% of the jobs will change as much as 80%.”

Core to much reorganization is a refocus on individual contributors or staff who focus on getting actual work done rather than overseeing other people. The result will be fewer middle managers and a small cadre of leaders at the top managing a much larger number of employees than they had in the past. Jensen Huang, the Nvidia CEO who has said he oversees more than 50 people, provides one example.

These teams aren’t just larger, they are also more multidisciplinary, bringing engineers and product development, designers and other business people together.

Anuj Mehndiratta, partner and head of portfolio impact, data science and product at venture-capital firm Thrive Capital, says the firm has a head of AI on its team. That’s uncharacteristic of most VC firms, but it reflects a belief that engineering and business people need to come together. In this case, it fosters an understanding of how the capabilities of cutting-edge models are developing and where innovation is headed.

The cost of AI compute is also driving workforce hiring decisions. Increasingly, the question of whether to hire more human engineers or invest in GPUs is a real decision, said Apoorv Agrawal, a partner at technology-focused investment firm Altimeter Capital.

The resulting organization will look less like a triangle and more like a barbell, according to Agrawal.

“You’ve got a lot more [individual contributors], and you’ve got some leaders that have a lot more [individual contributors] directly reporting to them. And so the shape of the org, which was historically a little bit like a triangle, is more like this,” he said.

People come together on an ad hoc basis to work on projects and problems and move to other ad hoc groups. That’s not the same thing as a group of people reporting to a boss.

To make it work, tech leaders are collaborating more closely than ever with human resources and people leaders traditionally responsible for workforce changes. Perhaps no company is a better example of that than biopharmaceutical company Moderna, which actually formally merged its technology and human-resources departments under one leader late last year.

“If you think about HR, HR has done traditional workforce planning, and they thought about the people…. And the IT and the digital teams are planning for systems,” said Tracey Franklin, who was appointed to the newly created role of chief people and digital technology officer at Moderna. “And we looked at that and said: It’s actually all how work gets done. And so we need to start doing something that we call work planning.”

She said she’s been reworking teams not just around the capabilities and skills of the humans on staff, but also around what can be completed by AI tools.

“You see this evolution constantly of people just adapting, creating new things, adjusting their roles,” Franklin said. “The rapid advancement of AI, it’s just really a catalyst to say humans, machines, robotics are all going to be integrated.”