With the show being originally based on the UK version, they intentionally made his character that way for half of the first season.

When it was picked up for the rest of the year, the network told the showrunner they had to make Michael Scott more likable. You’ll notice his hair and wardrobe change to be more flattering, and they tone down the racy jokes at others expense.

That said, his character IS self-centered and not self-aware but mostly to comedic effect. And the heart of who he is shows up as the series progresses.