Author: Fang Dao

The discussion about "the disappearance of middle management" is essentially not about the existence or demise of a position, but rather that a certain function within the organization is being systematically replaced.

As AI Agents begin to possess the capabilities of task decomposition, process execution, and result feedback, the information processing and SOP execution that traditionally relied on human labor are being transformed into capabilities that can be automatically completed by systems. What is being compressed is not a specific level, but rather "the part of work that can be written into processes."

The reason traditional company structures require middle management is not due to management itself, but because the cost of information processing is high. Upper-level strategies need to be translated into specific tasks, while lower-level execution needs to be aggregated into structured feedback, creating the basis for the existence of middle management.

However, as information can be generated and synchronized by systems in real-time, and tasks can be automatically decomposed and tracked by Agents, the necessity of this intermediate link starts to decrease. Organizations no longer rely on "humans to convey information," but rather on "systems to operate processes."

This change is rooted in the same logic that leads to the replacement of lower-level positions: lower-level jobs are replaced because they highly depend on standard processes; the compressed part of middle management also revolves around processes—decomposing processes, conveying processes, monitoring processes. When processes themselves are taken over by systems, the differences between middle and lower levels in this dimension begin to converge. What is being replaced is not the position, but the work structure.

Therefore, the change happening in organizational structure is not merely a simple "flattening," but a form of "de-mediation." Information no longer needs to be passed down level by level, execution no longer relies on manual monitoring, and the hierarchical logic within enterprises shifts from "information asymmetry" to "capability distribution." In this new structure, what remains is not positions, but the capabilities themselves.

Middle management is starting to be re-differentiated into two types of roles: one that relies on process operation, with its value decreasing as system capabilities improve; and the other that can define goals, organize resources, and be responsible for outcomes, with its value increasing. The core of the former is to ensure processes run without errors, while the core of the latter is to enable the system to function under uncertainty.

This is also why "being able to use AI" is frequently mentioned, but a more accurate statement should be: the ability to embed AI into business processes and create stable outputs is becoming the new threshold. AI itself will not automatically create value; it needs to be orchestrated, constrained, and integrated into the organizational operational system. Whoever can complete this orchestration will occupy a new structural position.

If we push this change one step further, we can see that the form of enterprises is undergoing a deeper transformation: companies are no longer merely human organizations but are gradually evolving into a "capability scheduling system." In this system, part of the capabilities come from people, and part come from models, while what is truly scarce is the ability to integrate the two into a structure that can operate sustainably.

Middle management will not disappear, but the "pricing logic of middle management" has already changed. The past value came from information differences, while future value will stem from system control. When AI compresses information value, what remains in the organization will be those nodes that can define rules, schedule systems, and be responsible for outcomes. In this sense, enterprises no longer need more "intermediaries," but rather more "system nodes."

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