Bob wants a raise.
Unfortunately, there’s just no budget for it. As his manager, it’s time for me to have a tough conversation. I tell him he’s a great employee and a valuable member of the team, but my hands are tied. I offer him training and other non-monetary benefits he might be interested in. I say the company believes in him, and wants to see him grow and thrive.
But Bob’s not having it. If the company really values him, why not make it work? I understand. It’s nothing personal, but there’s just no wiggle room. Learning some new skills, however, could help his career.
He’s still not happy. That’s when I pivot to a firmer tone. I value him as an employee, and I hope he stays. But if this isn’t the right place for him, he’s free to leave. Bob agrees. “I think I need to seriously consider other opportunities,” he says.
Looking back, I made some good moves early on in the conversation, like expressing appreciation, addressing the issue directly, and acknowledging Bob’s feelings. It was also smart to offer him alternative benefits and upskilling. But I dropped the ball twice. I could have included more specific examples of the non-monetary perks on offer. And I made one critical error: I introduced the idea of him leaving, something he seized on and took seriously.
I’m not actually Bob’s manager, of course. Because Bob is a robot.
Processing it all, please stand by
The dawn of generative AI is shaking up the business world as it sends companies scrambling to incorporate the new technology into their operations. One prong of that rethink includes a slew of new AI manager coaching products aimed at helping bosses get better at their jobs. The reasoning is that getting managers more practice at things like holding difficult conversations and negotiating salaries can help stave off more serious issues down the road.
That may be particularly key to companies considering how important—and precarious—the manager position has become. In 2024, around 71% of managers said their workloads had increased, according to one survey, and 60% felt more overwhelmed than the previous year. Those stress levels have big ripple effects, as managers have an outsized impact on productivity, retention, and morale. Around 70% of worker engagement differences between teams can be attributed to the manager, according to a 2024 Gallup report.
The price of lackluster management? Billions. One study from 2019 put the five-year cost of turnover due to a toxic workplace culture at around $223 billion. Another found that businesses lose up to one trillion a year in voluntary turnover, even though 52% of departing employees say that their manager or organization could have done something to prevent them from leaving.
These new AI tools hold the promise of handing corporations the ability to improve soft skills for mass numbers of workers, and improve engagement and retention levels among employees. But experts and creators alike warn that they must be used responsibly, and serve as a jumping off point—not a final destination.
“Right now we’re basically scratching the surface of one-on-one stuff,” says Apratim Purakayastha, the general manager of talent development solutions at Skillsoft, a talent development company that has released an AI manager training product. “How to give better feedback, how to do performance reviews, how to talk to a recruiter. Those are vanilla things. But even those vanilla things are often inaccessible to most human beings.”
Coaching managers at scale
Helping people learn better management techniques is famously difficult, even as corporate America becomes increasingly interested in cultivating emotional intelligence among its workers.
Most managers learn on the job, and if they’re lucky, they have workplace mentors who take time to guide them through the travails of overseeing direct reports. Formal management training has historically been the province of high-level executives in whom companies are willing to invest thousands of dollars for private coaching. The gap between upper and middle management is where AI coaching comes in.
That’s exactly the interest that Praxis Labs, an AI learning, coaching and assessment company, has piqued in clients. In 2024, the company launched a GenAI-enabled platform in 2024, with AI coaching as part of that offering.
“We’re seeing a lot of our clients want to focus on that middle manager at scale, and this desire to reimagine manager training,” Elise Smith, co-founder and CEO of Praxis Labs, tells Fortune. “Given that a lot of our manager trainings were developed and designed before COVID, so much has changed.”
CodeSignal, an interview and assessment skills platform, also launched an AI management training product last year. Users can speak to the AI, and the bot responds via audio. In-house designers have built various role-play scenarios, and created rules around what success and failure look like in each simulation. Right now, CodeSignal is focusing on management training for engineers in particular.
Tigran Sloyan, the company’s co-founder and CEO, says that chief technology officers and chief information officers have been asking the company for products that serve frontline and first-time managers. “I think at a very executive level, like the VPs and SVPs, they’ve already got some semblance of a solution,” he says. “But once you go to a larger scale, it’s very difficult.”
Skillsoft launched its AI management feedback model, CAISY, in September of 2023, and has since launched other products. It processes information spoken or written by a user, and responds via written text or voice. The company has created different personality styles for the AI: accepting, dismissive, defensive, and random, with the goal of creating additional offerings in the future. The tool also takes into account internal company training and culture documents that reflect how individual companies differ when it comes to what they want out of employees. First-time manager simulations are some of the most popular products within this training category, including simulations in critical thinking, avoiding burnout on remote teams, and coaching underperforming employees.
“Suppose you’re going to have a really difficult performance conversation with an employee,” says Purakayastha. “You want to practice in a safe space.” He’s careful to point out, however, that this is not a set-it-and-forget-it tool when it comes to leadership training in the workplace. “I would still not consider this as a replacement for more traditional management training,” he adds. “I think this is a good practice tool at this moment, right? But this does not replace coaching.”
It’s still early days for AI management coaching technology. And although it holds the promise of solutions that have bedevilled workplaces for years, experts say that it should be used carefully.
“I think any sentence that starts or ends with, ‘I’m going to let the bot handle this and then walk away,’ is wrong,” says Bryan Ackermann, the head of AI strategy and transformation at Korn Ferry, a search and consulting firm.
Instead, he says, companies need to take a holistic approach to how they’re using these tools. That may include setting a goal, like having all managers get better at difficult conversations. After managers engage with that scenario, the company should check up to see how those conversations went, and speak with their direct reports as well to get their take.
“Now you have my attention,” says Ackermann. “Now you’re talking about a more fully formed effort to develop the population of managers.”
Emma Burleigh contributed to reporting
