I've been working with several management teams recently. They realize they need to change how they are organized in order to really make the agile teams even more productive.
For example, what good is a functional manager? If functional managers don't need to assign tasks and check on how the work is going (the team does this), the functional manager needs to build a trusting relationship with people, and provide career development. The manager sets the mission/purpose of the group. The manager needs to see when the team (or teams) need more people, and to start and lead the hiring process. The functional manager may act in what I think a technical lead role is: to help uncover other ways of working, whether that is specifics (extend the design this way, test that way) or to coach the person into recognizing where to look for help. And, the big decision that managers make: which project to work on now. (Of course, there is also strategic planning, customer visits, etc.)
Project managers/Scrum Masters/whomever is charged with protecting the team's process can't do this work. Managers need to do this management work. But should there be development and test managers anymore? I think not.
Now, I can't tell if my background is coloring my opinion here (of course it is, JR!). I was a development manager and a test manager at the first and mid-levels. I ran several departments, both in product companies and in IT. When I was a manager, first of development, we didn't have professional testers. We did our own testing. We were ok at it, because we tested each other's pieces of the product. As a test manager, I knew what the developers were going through, because I'd been a developer and a development manager. And, because I focused the test group on discovering more information (that's the mission/purpose thing at work), the testers' information became ever-more-valuable to the developers. I was a better manager because I understood what was going on between development and testing. By that time, I also understood the writers, even though I had not been a writer or managed writers. When I managed an entire engineering group of 80 or so people, I found that the bulk of my work was helping the functional managers understand the pressures on the other managers so they could work in a way that made sense for the entire organization.
In a technical agile organization, everyone is organized into cross-functional teams who deliver working chunks of functionality every few weeks. If the teams don't have specialists, why should the managers be specialists? Isn't that an outmoded way of thinking?
I should explain that Mary Poppendieck probably disagrees with me. We were talking about the role of the matrixed functional manager on an agile team while we were in Vancouver at Much Ado About Agile. I've been thinking since then, and working with my clients. I still disagree that the functional manager needs to provide specific-to-the-function technical leadership. I agree that coaching is necessary, but that doesn't require a test manager for testers or a development manager for developers. It requires a true manager who can coach and help find the answers.
If we are asking the technical staff to be better at a wider variety of tasks, we need to ask managers the same thing.