This is a complicated question.

The Germans had a tactically very good army and some very good generals to lead it. However, these generals also liked to blame others for their defeats, and Hitler was a prime target for this, being dead (con't defend himself) and a supreme villain (thus everyone will believe whatever you pin on him).

The German army lacked strategic focus and above all logistical ability, and it told a lot on the eastern front. They were also unable to see the more refined Soviet operational doctrine. The Soviets were still sub-par compared to the Germans on the tactical level, and to the Germans it looked like they simply used numbers to overcome German tactical skills. Since the west only got accounts from the western armies and those of the Germans that ended up in West Germany after the war, this became the prevailing view for a long time - the German army was superior with superior leadership, the Soviets used human wave tactics and only won because of Hitler's meddling and their superior numbers.

The Germans did simply not see the advanced operations behind a Soviet offensove. Maskirovka tactics - hiding concentrated forces and fooling the enemy into thinking large concentrations were set up elsewhere by using dummky tanks, increased radio traffic, making fake roads and convoys of empty dummy trucks pulled by a single truck making lots of tire tracks and creating the impression of building up supply depots and so on. The Soviets built up extensive amounts of supply and reserves, especially Heavy artillery. Specialised troops under central command (heavy artillery, heavy tanks, tank destroyers, recon units, deep patrol units, mechanised formations, communications and supply troops and so on), as well as central command officers were attached to the forces conducting the offensive. The offensive then commenced with a tremendous artillery barrage (possible by attachment of extra artillery and build-up of supplies) and then a frontal attack on a wide front. Unsuccessful attacks were then suspened and successful attacks reinforced by reserves and forces moved from unsuccessful attacks - to the Germans it looked like they were simply overpowered by a flood of Soviet troops, but careful planning, control and buildup was what allowed it.

That said, Hitler's meddling probably made a bad situation worse.

I'll re-hash an earlier answer of mine from here.

Hitler was not a great general, far from it.

His good sides;

1. He was prepared to side-step seniority and adapt a good and innovative plan when it was required. See for example Manstein's Fall Sichelschnitt plan for the invasion of France.

2. He was a risk-taker and would bet hard on small chances and narrow margins. Especially early war this paid off quite a bit. He bet that the French would take more than two months to assemble a serious offensive to relieve Poland, and defended the west with a motley collection of second and third line divisions that lacked much of their equipment. The campaign in Norway was also a prime example of this.

However, this is where his good abilities stop.

His bad sides;

1. He was unable to organise the high command and the war in a unified way, instead encouraging infighting between the OKH (Oberkommande des Heeres, High Command of the Armies) and the OKW (Oberkommande der Wehrmacht, High Command of the Armed Forces) and intriguing between officers for command, his attention and the spotlight, which gave them more resources. he had this fault when it came to politics as well, and encouraged infighting to ensure that noone fought him for the supreme position.

2. He was unable to take criticism, feedback or in any way take the blame for any failure. That way he would not learn and would not improve as a general. In the long run, it also meant that he appointed yes-men and commanders with political skill rather than skilled generals to conduct the war. All others were simply removed.

3. He was unable to see skill in defeat. Some German generals did miracles, kept their armies together and delayed the enemy and caused him massive casualties, but were eventually driven back - Hitler saw this as a defeat and would remove the general.

4. He was unable to keep himself from the details, losing overall focus and oversight. He would often study things in extreme detail and berate generals for not knowing where their battalions were exactly (which was the duty of the regimental or divisional commander, not the army commander) or industrial owners for not knowing details of armament. Generals soon had to spend hours reading up on the exact positions of individual small units under their command before a briefing with Hitler, time better spent on other things. Hitler would also place battalions and move them around, with no regard for the knowledge on the ground (the strength and readiness of the battalion, the local terrain, line of sight and enemy dispositions etc).

5. He believed in fixed defence and placed troops like they had been placed early ww1 - with all firepower to the front, preferably in fixed positions, to blunt an enemy attack directly. This is an amateur's view of war (as much firepower as possible) and in reality a flexible defence (with small outposts up front and most of the firepower further back) with a large reserve will allow you to blunt an enemy attack late ww1 or in ww2 much better. Line thinking, which goes back to the first village pallisade all through warfare until early ww1 was obselete - you needed to think along the lines of hedgehogs, outposts and large fields rather than lines, and Hitler could and would not.

6. He placed much too much focus on morale. Ordering that veteran tank crews that had been defeated should not get new tanks first, as they would be demoralised, so they should go to newly trained crews with high morale instead. In large area warfare, from ww1 and onward, morale was fed by food, sleep and getting arms and ammunition needed. Then the men used their training and fought for their comrades rather than consider any defeat or grandiose statements or "signals sent" by high command. Hitler believed in these grandiose gestures and morale and was heavily mired in late 19th century romanticist ideas of morale, nationalism and a national will. He firmly believed his "not a step back" order during the 1941-42 winter Soviet counterattacks saved the German army and that it was Napoleon's order to retreat that had doomed the French invasion of Russia. Most likely, if the Germans had used flexible defence, they would have lost less men and caused the Soviets massive casualties during the winter fighting.

Hitler was disregarded as a General by the German officer corps. He had not gone through officer school, he had not been a cadet, he had not been promoted to a staff position and done staff work, and he had not played any kriegsspiel (realistic board games the Germans used to play through potential battles at all levels).

I use a 4-rule guide to a general.

Organisation. Can the general organise troops so they fight welland the civil society to provide him with more troops, supplies and other things needed to fight. Can he keep himself involved only at a level above and a level below his own, to have focus on what he needs to do? Does he understand logistics?

Hitler was a lousy organiser. He inherited a strong officer corps and a good military tradition, and a fantastically organised army, but did nothing to improve it. Indeed, when it resisted his attempts at controlling it, he expanded his bodyguard (Waffen SS) to a full army, and that army was exceptionally crappy except for 3-4 divisions mid-war. He got involved at too much detail, concerned himself about 'signals' sent and much more.

Tactics. Can the general win battles under different circumstances, against differing and sometimes superior opponents? Can the general delay superior opponents and keep his forces together under dire circumstances? Can the general handle a guerilla insurgency as well as a line battle?

Hitler used amateur military tactics and early ww1 thinking, and refused to learn. He was a lousy tactician.

Strategy. Can the general see the big picture, can he use his victories to knock out enemies of the war, can he follow up on successes and not go headlong into pursuits where he will be stranded? Can he get allies and improve his positions without fighting? Does he have an understanding on how to undermine the enemy ability to fight?

Here I would actually give Hitler something. He was good at this. He knew the need for strategic terrain, knew the need for allies and knew the importance of raw materials. However, he lacked the planning for a long war, which brings him down from an excellent grade.

Politics. Can the general keep in position despite others trying to remove him? Can he get allies, can he work with those allies? Can he secure resources from himself, work with his seniors, juniors and equals? Can he drum warring tribes together against a common foe? Can he build a legacy that lasts? Can he appoint the right men to the right place and promote competent people?

Here Hitler fails again. He was unable to take criticism and removed anyone who opposed his ideas, filling the OKW with yes-sayers. He got into power and remained there, but that is also all he managed to do in this area. His legacy is destroyed and mere mentioning of it is an insult.

So, 1 good, 3 failures. Not a very good general, I say. If I would place Hitler anywhere, it would be as a Staff Major at an Army Command.

There is a common meme that the German military commanders were uniformly geniuses, who would have won the war if it weren't for that meddling Austrian.

This is because many members of the German military leadership published writings post war that pushed a lot of the blame on the party leadership/Hitler rather than their own decisions. With that in mind, it's entirely within the realm of possibility that they were just making up excuses for their own miscalculations. Certainly, they thought he knew what he was doing after France fell so quickly.

That said, Hitler absolutely was a micromanager. There is a possibly apocryphal story of a British intelligence officer who was briefing Churchill on Hitler, and mentioned that he was someone who interfered and micromanaged a lot. Churchill smiled and said "like me then."

He also had a tendency to vacillate between decisions and projects. He was lukewarm towards a new service rifle being funded and didn't care for it until it was demonstrated in front of him late in the war, for instance. He tended to randomly move programs to the head of the queue for resource allocation, based upon whoever stopped him in the hallway. To paraphrase someone on /r/badhistory, "say what you will about Joseph Stalin, at least he knew how to run a staff meeting."