IADS Press Release: IADS White Paper- Middle managers: remnants from the past or tomorrow's unicorns?

Often seen as mere cogs in the machine, middle managers have historically been central to fostering operational efficiency and maintaining organisational cohesion in department stores, notorious for their longstanding complexity and sophistication. Now that department stores are evolving, are middle managers destined to become remnants of the past? The annual IADS White Paper explores the complex relationship between middle managers and retail companies. It highlights their pivotal role in maintaining operational efficiency, driving innovation and spearheading organisational transformation in a challenged retail landscape. Good middle managers might be very well tomorrow’s unicorns in retail! 

Since its inception in 1928, IADS’ purpose has been to coordinate information between department stores worldwide and research their activities to address their many challenges. The IADS produces a White Paper on a specific topic relevant to the industry every year, and always from the department stores’ point of view. The 2021 edition reviewed how department stores managed the COVID-19 pandemic. In 2022, digital transformation and how it impacts organisations was tackled. In 2023 the focus was centered around CSR and ESG, and the 2024 edition was dedicated to retail media. 

The IADS 2025 White Paper investigates middle management's critical—and often underestimated—role in driving department stores’ evolution and performance. Rapid technological advancements and shifting consumer expectations raise questions about the need for middle management now that traditional retail models are heavily challenged. Middle managers are essential leaders, connecting top management’s vision with frontline operations. The IADS research analyses their roles, challenges, and how they can continue to create value for department stores. 

From the first mail ordering attempts in 1845 to implementing AI-driven solutions, department stores have had to adapt to new contexts continuously. However, one reality remains constant: retail is a people business. This is why department stores have always relied on their often-unsung heroes, middle managers, who have always bridged the gap between strategic vision and day-to-day operations, ensuring that the innovative strategies devised by senior leadership were effectively executed on the ground.  

Department store productivity grew significantly from 1900 to 1980, as did the overall share of middle managers. However, in the 1990s and 2000s, the love story faded due to the technology boom, and middle managers were increasingly considered an unnecessary bureaucratic layer. Then, with the financial crisis of 2008 and the pandemic of 2020, middle managers' roles needed to be reimagined, but, instead, many of them were eliminated to optimise costs. 

Today, the role of middle managers extends beyond operational oversight. They are crucial in navigating the complexities of technological advancements, driving innovation and addressing the need for a more agile and resilient organisational structure. Their ability to act as navigators, connectors, and coaches is fundamental to successfully implementing transformative initiatives. 

With the growing complexities in retail, it is time to reevaluate the role of middle managers. Sometimes seen as the "unloved children" of retail and often criticised for slowing down decision-making, middle managers are more than ever indispensable connectors between strategy and execution. Their proximity to the frontline and senior leadership allows them to implement innovative strategies while ensuring teams remain agile and responsive to consumer demands. 

The IADS White Paper highlights how middle managers are key to fostering innovation within department stores. They often pilot transformation projects, so their balanced perspective allows them to advocate for changes aligning with executive goals and practical day-to-day realities. It demonstrates how they can initiate and sustain organisational changes by leveraging their knowledge of operations and strategic objectives, as Carrefour’s customer-centric revolution exemplifies. In particular, the White Paper underscores their central role in navigating AI adoption, balancing technological efficiency with human oversight. Indeed, as stated by Gartner during their 2024 IT Symposium, AI will contribute to flattening organisations even more, leaving some middle managers jobless. However, the IADS strongly believes that AI will allow them to focus on more strategic activities, increasing the value they bring to their companies.   

The path to excellence and the ability to become a change agent is a shared responsibility 
Both middle managers and companies are responsible for making the most of these key executives. Companies can help middle managers develop transverse skills that are increasingly important in differentiating high-performing middle managers from their peers:  

•  Emotional intelligence (as exemplified by US grocery company Wegmans),  
• Resilience and ability to embrace change (The John Lewis Partnership has developed some groundbreaking initiatives in this field),  
• Strategic thinking (outside of the retail world, US studio Pixar provides an interesting example of how to foster such a capability), 
• Transversal collaboration and ability to leverage informal networks to enhance collaboration, better handle challenges, and support innovation. While the Harvard Business Review states that middle managers are bound to become “people leaders”, the IADS believes they are also becoming “internal influencers”, building a culture of resilience and collaboration, as it happened at the Australian telecommunications company Telstra when it reinvented its middle managers’ roles. 

Instead of seeing them as a potential source of savings through their elimination, companies should reduce unnecessary pressure on middle managers, foster flexibility as Marks & Spencer’s arrangements suggest, and grow development programmes and mentorship, an often-untapped opportunity in retail companies.  

Finally, by leveraging technologies like AI, middle managers and companies can re-bundle their roles so that they can spend more time on leadership and innovation. This way, companies can maximise middle managers’ efficiency to create value continuously. 

The IADS 2025 White Paper analyses the current state of middle management and offers actionable insights on how department stores can empower these leaders for the future. It provides recommendations on attracting, retaining, and developing middle managers who can navigate the challenges of a modern retail environment. Flexibility, autonomy, continuous learning opportunities, and alumni groups, as exemplified by the Chalhoub Group, are key factors in securing top middle managers. The IADS white paper, “Middle managers: remnants of the past or tomorrow’s unicorns?” serves as a call to action for retail executives to invest in and empower their middle management teams by creating a supportive environment where they are trusted to take on greater strategic responsibilities and lead transformative initiatives.  

Read the full press release below:

Access the White Paper below: