If you have just 1 person, you should collapse the circle back as a role. Usually you create a circle when you have more than 1 person and want to give them more freedom in terms of self-organization. Otherwise a role is just fine.
About the "former" manager: there are many different possible paths. He or she can go back to the trenches by energizing roles that perform "operational work" that he used to manage. Another possibility is filling roles related to coaching and training. In some circles it is common to have a role that centralizes some kind of process or strategy, where other roles are accountable for aligning with. For example, in some software development circles there might be a role accountable for defining and improving a software development process (In this case, it is important to make other roles accountable for following the process defined). I think that might be an appropriate role for a "former" manager.
Hope that helps!