Microsoft's CTO says product managers have a key role to play in training AI agents

• Product managers will work closely with AI agents, said Microsoft's chief technology officer.
• AI agents — AI that acts independently, including as digital coworkers — are a hot topic in tech.
• Tech's top execs are psyched about AI agents. Jensen Huang said Nvidia could have 100 million of them.

Product managers need to be "domain experts" in AI agents, said the chief technology officer of Microsoft.

Kevin Scott said on an episode of the Twenty Minute VC podcast published Monday that product managers play a crucial role in setting up "feedback loops" to make AI agents better.

AI agents — AI that can act and make decisions independently — are a hot topic in tech and the workforce. Nvidia's CEO, Jensen Huang, said in January that "the age of agentic AI is here" and said last year that Nvidia's 50,000-person staff could work with 100 million agents. OpenAI's Sam Altman predicted that AI agents could start entering the workforce this year.

AI agents are intended to be digital coworkers or assistants to human workers in fields ranging from healthcare and supply chain management to cybersecurity and customer service.

But for now, AI agents lack something fundamental, Scott said.

"They are conspicuously missing memory, which makes them awfully transactional," Scott said. Even the agents that do have memory, he added, have a very limited form of it.

Scott said he hopes AI agents can remember user interactions over time, allowing them to "conform" themselves more to users' preferences.

This kind of memory would give agents "abstraction and compositionality," making them feel less like simple chatbots and more like intelligent digital coworkers, he added.

Eventually, he said, the goal is for AI agents to handle increasingly complex tasks — just like a real colleague would.

Product managers' role

In the tech world, product managers have been referred to — both affectionately and critically — as "mini-CEOs" of the products they oversee.

They act as a bridge between engineers, sales teams, customer service, and other departments, ensuring that products align with user needs.

But the role has become a polarizing one, Business Insider's Amanda Hoover reported in November. Some tech workers argue that product managers add little value.

According to ZipRecruiter, the average product manager in the US makes about $160,000. Software engineers, meanwhile, average about $147,000, and tech marketing specialists average about $87,000.

Microsoft wants to increase the number of engineers relative to product or program managers, BI's Ashley Stewart reported last month. Other companies like Airbnb and Snap are rethinking the need for product managers.

The call for executives to go "founder mode" — a concept coined by the Y Combinator cofounder Paul Graham and touted by Airbnb's CEO, Brian Chesky — has some leaders questioning whether they should delegate product decisions to product managers.

In 2023, Chesky merged product management with marketing, and Snap told The Information in the same year that it laid off 20 product managers to help speed up the company's decision-making.

Others believe product managers' influence will only grow in the age of AI.

"The future really does belong to product managers," Frank Fusco, a product manager turned CEO of a software company called Silicon Society, told BI in November.

As AI becomes more capable of handling coding and other engineering tasks, Fusco said it's an opportunity for product managers to take on an even greater role.

With investors and executives eager to capitalize on AI and consumers still skeptical, the demand for product managers will only rise as they help bridge the gap, he added.