Why is Amazon CEO Andy Jassy cutting managers, streamlining processes?

Amazon CEO Andy Jassy announced earlier this week the company plans to reduce the number of managers. He said this move aims to speed up decision-making processes and preserve Amazon’s unique culture. Jassy believes that excessive layers of management are slowing things down, according to Business Insider.

Last September, Jassy initially revealed these changes.

“Overall, I like the direction in which we’re heading and appreciate the hard work and ingenuity of our teams globally,” he said.

Amazon’s leadership emphasized the company’s ongoing growth and innovation across various sectors, including AWS, Advertising, Prime Video and new investment areas like GenAI, Kuiper and Healthcare.

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To address concerns about organizational structure and efficiency, Amazon plans to increase the ratio of individual contributors to managers by at least 15% by the end of March 2025.

“Having fewer managers will remove layers and flatten organizations more than they are today,” the statement explained. “We want more of our teammates feeling like they can move fast without unnecessary processes, meetings, mechanisms, and layers that create overhead and waste valuable time.”

Pre-pandemic office arrangements

In addition to reducing managerial layers, Amazon is reinstating its pre-pandemic office arrangements. The company believes that being together in the office fosters better collaboration, innovation and cultural integration.

“We’ve observed that it’s easier for our teammates to learn, model, practice and strengthen our culture; collaborating, brainstorming, and inventing is simpler and more effective,” the statement noted.

The new office expectation will take effect on January 2, 2025, with assigned desk arrangements returning to locations that previously had them.

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Amazon acknowledges this transition may require adjustments for some employees.

“We understand that some of our teammates may have set up their personal lives in such a way that returning to the office consistently five days per week will require some adjustments,” the statement said.

To facilitate a smooth transition, the company’s Global Real Estate and Facilities team “is working on a plan to accommodate the new desk arrangements.”

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The company also introduced a “Bureaucracy Mailbox” for employees to report unnecessary processes and bureaucracy.

“I will read these emails and action them accordingly,” the executive assured.

Jassy said these changes reflect Amazon’s commitment to operating like the world’s largest startup, focusing on customer obsession, high ownership, fast decision-making, and a collaborative culture.

“Strengthening our culture remains a top priority for the s-team and me and I think about it all the time,” the executive concluded.

Bill Kaczaraba is a content editor at MyNorthwest. You can read his stories here. Follow Bill on X, formerly known as Twitter, here and email him here.