It’s safe to say that leading a team in the age of artificial intelligence presents managers with a new host of challenges that didn’t exist five—or even three—years ago.

Sure, the rigors of navigating personalities, making strategic business decisions, and communicating a clear vision haven’t gone anywhere.

AI has simply added a new layer of complexity for team leaders to contend with: How does your team incorporate emerging technologies into existing workflows? When should a company defer to human judgment, and when should it lean on insight from AI tools? Should managers wade into the proverbial weeds of understanding the cutting-edge technology their team is using, or should they remain focused on the bigger-picture strategy?

Increasingly, these are the types of questions executives must weigh, as AI increasingly permeates major industries, transforming professions and requiring managers to retool. A survey by McKinsey found that 92 percent of companies plan to increase their AI investments over the next three years.

Yet, only 1 percent of leaders considered their AI usage “mature” in driving substantial business outcomes, suggesting that far deeper integration of the technology is still to come.

Similarly, the World Economic Forum’s 2023 Future of Jobs Report found more than 75 percent of companies were looking to adopt these technologies within five years. 

And that was two years ago.

With that in mind, there are some key skills managers must have in 2025 when it comes to leading teams and incorporating AI.

Understanding the capabilities and limitations of AI

The manager of 2025 may not need to be deeply versed in every “in” and “out” of the AI tools their team is using.

But they do need to be literate enough in the technology to broadly understand what those tools can do, what they can’t, and how they’re limited.

For instance, while AI plays an integral role in analyzing data and offering predictive analysis of future trends, the models are only trained on what they know. They can, and can be prone to so-called “hallucinations.”

Managers need to know that. And part of their role in an AI age is to help establish guardrails and use cases around these tools, and to steer their team toward the best workflows that incorporate technology, including advising on when they should instead rely on human insight.

Learning how to effectively communicate with the technology

Another key skill for managers is: how to effectively communicate with AI by writing prompts that get the correct responses.

So much attention is paid to the near-instantaneous results AI can offer, but there remains a good deal of “work” on the human’s part: figuring out what to feed into the model.

Increasingly, research into teams’ use of AI reveals that managerial AI skills have a more significant impact on organizational innovation than technical skills, as evidenced by a recent study in the Journal of Business Research.

Just like the best researchers are adept at finding and synthesizing information, today’s worker must be well-versed in the tactics that will help them get the most out of AI tools, — all with the ultimate goal of helping their team reach its goals.

All of that starts with managers coaching their teams on AI strategy, and driving alignment on how to best collaborate with one another and with the technology.

Continuing to foster collaboration and cohesiveness

Finally, managers, team leaders, and executives must continue to be champions of collaboration, team cohesiveness, and prioritize human connection.

Even the most powerful technology can’t replace the personality management, conflict resolution, and trust-building skills that inherently come with leading within an organization. 

That’s particularly true as AI tools, by their very existence, serve as a disruptive force within many organizations, altering workflows and upending past ways of doing business.

Managers can and should be steadfast advocates for the human judgment their team brings to the table, and guides for when to defer to their team’s insight—while still insisting on using emerging technology to drive innovation and operational efficiency.

“Managers must learn to use AI and welcome it as a limited partner, but also not forget their core job of supporting their employees succeed through providing resources and removing obstacles,” said Mark Clark, associate professor at American University’s Kogod School of Business.