Middle Managers: The Crucial Link In Navigating Organizational Change

December 15, 2023


As startups grow into small and medium enterprises, owners and top executives must create layers of middle managers to oversee day-to-day operations, entry-level and front-end employees, and lower-level middle managers.

Those employees, who must lead their teams and follow explicit instructions from superiors, are under the most pressure in any organization. “Managers face pressures from above and below,” noted a March report from McKinsey. “They tend to be underdeveloped and unempowered, and they face growing pressure to deliver flatter, faster and leaner organizational structure. All of [that] leads to being underutilized and unappreciated.”

That puts the entire organization at significant risk. “Middle managers … are essential to helping businesses navigate rapid, complex change,” said the Harvard Business Review in its July-August issue. “Organizational transformation can occur only with their involvement. They’re the glue that holds teams and enterprise together, fostering the inclusion and psychological safety individuals and groups need to thrive.”

“Without [middle managers’] ability … to connect and integrate people and tasks, an organization can cease to function,” according to Emily Field, a partner at McKinsey in Seattle, in July.

Motivating them is tricky. On the one hand, the company would lose middle managers’ expertise in their current roles if they were promoted. On the other, keeping them in their current roles could make them more likely to quit.

Who’s in the middle?

According to Indeed, an online recruitment platform, middle managers include “all management positions in a hierarchical company structure underneath the top management positions and above non-management workers.” The portal defines “top management” as anyone with an executive title, such as CEO or CFO.

Despite having “manager” in their titles, middle managers deal with customers if there is an escalation, unlike their superiors. “They serve as a buffer between top-level management and everyone else,” said Indeed. Middle managers are likely “branch managers, store managers, regional directors, or department managers.”

The online recruitment platform said they usually handle “issues that come up at a specific business site or in a specific department within the organization.” That includes “developing and implementing routines, monitoring employee performance, assigning and supervising tasks, [ensuring] compliance with … organization guidelines, [and] inspiring and encouraging employees to perform their best.”

Senior executives expect middle managers to “come up with ideas to improve productivity at a specific … location or in [their] department.” Middle managers also are responsible for hiring and retaining team members, and converting the strategic objectives passed from their superiors into everyday policies. They must also allocate resources to subordinates and report potential problems to senior managers.

Middle managers can come from either outside or inside an organization. According to Indeed, hiring from within requires executives to “prepare potential management candidates with increasing responsibilities before [promoting them to] the new management role.” That preparation process could require creating a new position such as “assistant” manager.

Promotion transparency and a clear career path for all job levels must be a priority, even if everyone agrees the promoted employee is the best for the job. The recruitment platform stressed, “Establishing a clear path for moving within your company keeps lower-level employees happy.”

Middle management positions could increase or decrease based on how top executives want to lead the organization and its growth prospects. “This might mean creating new departments … such as HR, sales or facilities maintenance, which were previously overseen by a single individual,” noted Indeed. “It could also be planning for future expansion by setting up a structure for regional or divisional managers once you’ve opened [new] physical locations.”

Middle manager struggles

Citing their hierarchical position in the middle of the organizations, the McKinsey Global Survey published in March found that top executives “treat middle management as a catchall.” Middle managers “spend much of their time handling nonmanagerial work and navigating organizational bureaucracy, rather than allow middle managers to focus on the most important role at an organization: fostering talent.”

That survey shows middle managers spend “almost” 75% of their time on tasks other than managing talent. A breakdown shows that “nearly half of [that] time is devoted to nonmanagerial work.” Several respondents said they spend nearly “one full day out of every week on administrative work.” The rest of that time is taken up by work that middle managers must perform themselves. That includes analysis, forecasting, and communicating department needs to other parts of the organization.

The share of time allocated to developing talent is decreasing. In 2020, a McKinsey survey noted that middle managers “spend less than [33%] of their time on talent and people management.” Three years later, McKinsey reported that figure at only 25%. During those increasingly limited periods, the focus is on training, coaching, and supporting employees’ development rather than recruiting and performance appraisals.

Further findings from McKinsey’s March report show that “42% … of surveyed managers … either disagree or are unsure that their organizations set them up to be successful.” They cite organizational bureaucracy evident in excessive meetings, emails, and approval processes as their biggest day-to-day hindrances. Nearly 25% said their problems revolve around “underperforming employees, senior leaders who have a negative impact on their teams and departures of valuable employees.”

Motivating system

Field noted that promoting non-management employees to management positions is relatively straightforward and likely results in higher job satisfaction. However, the story is different when moving middle managers up the corporate hierarchy. “Senior leadership feels a magnetic pull to promote top middle managers into positions where they no longer do what they love,” said Field. They “persist in promoting their best individual contributors [in middle management] without considering their fitness for [the new] role.”

Middle managers also push for such promotions, not knowing whether or not the new post would play to the strengths that make them a valuable asset to the company. One of the biggest reasons fueling the desire to move into the C-suite is the perception that “the word ‘middle’ implies that the person in that spot is on the way to somewhere else — ideally, the top,” said Field. “That thinking is misguided.”

Finding alternatives to giving promotions to motivate middle managers is tricky. “Much of the corporate world is still in the dark about how to promote stars within the same role,” said Field.

A McKinsey report in July cited how one restaurant promoted grill operators by giving them fancy titles like “master of the grill” and “Elvis of the grill.” The higher the title, the more responsibilities they get in the kitchen. They also get a bonus and salary bump when changing titles and eventually get to train novice employees in addition to their work on the grill. “The goal is to keep [grill operators] doing what they do best,” the report said. “Without quality grill operators, the restaurant couldn’t maintain its trademark dishes.”

Other companies have created alternative recognition tracks, particularly for technical jobs, to keep accomplished engineers, factory workers and programmers away from administrative work, which becomes more prevalent the higher the position in the hierarchy.

Field noted that companies could also offer the best middle managers stock options, which typically go to top executives. Bigger salaries are always critical. “When appropriate, pay the best middle managers even more than your senior leaders,” said Field.

Another option to motivate middle managers without promoting them out of their current roles is to move them to bigger or more important locations in the same capacity.

Top executives also could increase middle managers’ teams, give them increasingly challenging assignments and allow them more flexibility in office and work hours, plus other non-financial benefits.

McKinsey’s survey also noted that top executives should ask individual middle managers what they want. “Some may appreciate a bump in salary, others may value more time off… others may want a converted assignment or a travel opportunity,” the report said. “Tailor your rewards to the priorities of your managers.”

New attitudes, policies

Harvard Business Review noted that top executives’ attitudes toward their middle managers play a significant role in motivating them. “Too many top executives fail to empower people to do the work they’re uniquely suited to,” it said. “Middle managers, in particular, have suffered the most.”

The Harvard Business Review report recommends “removing the tasks that weigh [middle managers] down.” That could be done by increasing automation, reassigning those tasks to other low-level employees, or eliminating them. “That means prioritizing trust over bureaucracy. [It also means] discarding the ‘player-coach’ model, that has managers balancing two jobs instead of focusing on one.”

The other way of showing trust in a middle management team is by involving “the most influential … and high value … managers” in top executives’ meetings and decision-making processes. “You’ll want to bring them into the tent when making important decisions,” the Harvard Business Review report said.

That gives senior management better insights when evaluating strategy options “because middle managers have the best understanding on how [relevant] data is gathered and applies to day-to-day work,” noted Harvard Business Review. Middle managers “are essential to ensuring that data-based activities don’t perpetuate bias or impede performance.”

Top executives could use middle managers as “megaphones” to provide credibility when introducing new plans and strategies among low-level employees. Additionally, top executives could temporarily assign innovative middle managers to “join networks [to] generate and share ideas and execute resulting plans.”

Additionally, top management could give middle managers “critical projects or connect them with more influential colleagues [to] motivate [them] to shine.” Receiving high-level training to improve those managers’ weak points should also keep them energized and motivated.

Culture change

A conducive ecosystem and corporate culture are essential for middle managers to thrive. According to Field, organizations must ensure a clear statement of purpose that aligns with managers’ goals.

Senior executives also should “communicate that [middle management positions] are desirable roles … not a waystation.” Thirdly, they need to encourage middle managers across the organization to meet and share best practices.

Top management must ensure middle managers “feel free to speak up,” said Field. “They’re often the first to identify systemic problems and see solutions.” Lastly, senior executives must show middle managers compassion, “just as [they] expect them to show compassion to their [subordinates],” noted Field.

Lastly, the recruitment platform Indeed stressed that getting the most out of middle managers requires the C-suite to “understand the power dynamics within [their] company. [They must also be] willing to delegate.”