Threatened by announcements such as “When Machines Replace Middle Management” (Forbes, 2015) and “Data is the new middle management” (WSJ, 2015), middle managers have experienced considerable uncertainty during the last decade. Impending role envelopment can have important implications on the way of working and the productivity of middle managers. Hence, in this study, we engage with the question; Is digital automation an opportunity or a threat and how does automation impact the strategic roles of middle managers?

What is the underlying issue? On the one hand, digital automation such as the use of artificial intelligence (AI) and machine learning can assist middle managers, e.g. it can free-up time which they can allocate to more important tasks. On the other hand, these technologies can actually replace the middle manager in important tasks, making them appear less important to the firm. We argue that the outcome strongly depends on the tasks that are automated as well as on the middle managers’ level of experience. Our research, published in the Journal of Management Studies, shows the following:

1. When used to replace (formal-rational) reporting tasks (i.e., are routine-based and do not require human intellectual input to function), the application of automation indeed frees up middle manager capacity and enables them to become more strategically involved.
2. When used for (substantive-rational) budgeting tasks (i.e., tasks that are future-oriented and require human interpretation and input to function), the application of automation partly displaces the middle manager, reducing opportunities to inform strategy.
3. Interestingly, both effects depend on the middle manager’s position tenure.
   1. Longer tenured middle managers engaged in formal-rational tasks will have more problems to inform strategy in an increasingly automated task environment due to accentuated role displacement.
   1. Longer tenured middle managers engaged in substantive-rational tasks will experience less role displacement as they will keep co-informing the bottom line as automated systems currently still lack the sophistication to conduct these more complex (strategic) tasks without middle manager intervention.

Our research reflects the importance of acknowledging the type of task subject to automation, as well as how automation will imprint on the individual middle manager’s task environment in light of their role embeddedness (as proxied by their position tenure). Therefore, we recommend firms do the following:

1. Keeping middle managers engaged in the strategic decision making is crucial since they represent an important talent pool for future executives. To build additional capacity for strategic involvement, firms could increase the automation of routine tasks while at the same time allowing long-tenured middle managers time to accept, familiarize with, and benefit from the automation of these tasks.
2. The automation of more substantive tasks can increase middle managers involvement in strategy as well. However, this is wholly contingent on the level of sophistication of the automated system and the prior role embeddedness of the middle manager. Excluding human input from the middle rank in strategy formation may be harmful as important ‘tacit’ nuance may get lost.
3. We conclude with the recommendation: While automation embodies risks in terms of role depletion, it also holds important premise for role accumulation, improving the lives of middle managers and potentially augmenting their strategic inputs going forward.