Generative artificial intelligence (Gen-AI) has become a routine part of working life but over-reliance on the technology may erode managers’ ability to build moral insights, contextual understanding and know-how to do get a job done, according to a new study from the University of Bath.

The research, published in the Academy of Management Review, explores how tools such as ChatGPT may affect what academics call “managerial phronesis” – the practical wisdom managers develop through real-world experience, reflection and human interaction.

“Gen-AI appeals because it can help people complete tasks more quickly. However, Gen-AI cannot replace the lessons learned through first-hand experience. Unlike humans, AI does not experience the world, understand the consequences of decisions, or grasp the social and emotional complexities in our workplaces. Instead, it produces responses based on patterns found in existing data,” said Professor Dirk Lindebaum of the University’s School of Management.

“This creates a significant risk for organisations – as managers increasingly outsource their thinking to Gen-AI for idea generation, or when a practical problem arises at work, they may rely less on their own judgement. Over time, this could reduce their ability to learn from experience, think critically, and to anticipate what kinds of actions are needed now to meet future goals”, he said.

The team of researchers from the Universities of Bath, Ohio, Lausanne and Cardiff identified the concept of “epistemic de-skilling” – a process in which people gradually lose knowledge-related capabilities because they outsource too much thinking to Gen-AI. They suggested this was most likely to happen when managers are under intense time pressure and use Gen-AI as a shortcut rather than engaging deeply with a problem themselves.

“In these situations, managers may stop asking important questions, seeking different perspectives or learning from real-world interactions. Instead of developing a nuanced understanding of employees, customers or organisational challenges, they may come to depend on AI-generated answers that lack the context and moral judgement needed for complex decisions,” Professor Lindebaum said.

The team also developed the of idea how Gen-AI may be used to develop the judgment of managers, although this is likely to prove more challenging for managers. Specifically, the researchers noted that Gen-AI can strengthen managerial judgement when Gen-AI is used as a tool for reflection, rather than a replacement for thinking. The researchers dubbed this process “epistemic up-skilling”.

“Rather than accepting AI outputs at face value, managers can use them to challenge assumptions, explore alternative scenarios and test the reasoning behind their own decisions. Because AI systems often struggle to explain why they produce particular answers, the gaps in those explanations can encourage people to think more deeply about their choices and the consequences of their actions,” Professor Lindebaum said, adding that “this requires persistent effort on the part of managers to fill these explanatory gaps themselves”.

The study suggested that this beneficial outcome is most likely when managers know they will be held accountable for their decisions. In workplaces where individuals must justify their actions and explain their reasoning, Gen-AI can become a trigger for deeper reflection instead of a substitute for judgement. “It is that which Gen-AI cannot satisfactorily explain that managers must explain to themselves and others”, Lindebaum adds.

“It is becoming increasingly clear that simply introducing AI tools will not automatically improve decision-making or organisational performance. Instead, organisations need to carefully design roles, responsibilities and workflows to ensure employees continue developing the human skills that AI cannot replicate,” Professor Lindebaum said.

The research team comprised Professor Dirk Lindebaum, Professor Natarajan Balasubramanian of Ohio State University, Dr Mehreen Ashraf of Cardiff University, and Dr Patrick Haack of the University of Lausanne. The study A Process Model of Managerial Phronesis in the Age of Generative AI can be read here.