In an effort to stymie bureaucracy at Amazon, CEO Andy Jassy in mid-September announced a plan to increase the ratio of individual contributors to managers by at least 15% by the end of the first quarter of 2025, according to an internal memo obtained by Business Insider.
This largely has to do with Amazon’s disdain for inefficiency and having too many stakeholders involved in decision-making.
“The reality is that the [senior leadership] team and I hate bureaucracy," Jassy said during an internal call this week, the same meeting where he addressed employee questions about Amazon’s strict return-to-work policy, a spokesperson confirmed to Fortune. "One of the reasons I'm still at this company is because it's not a political or bureaucratic place."
The Amazon spokesperson told Fortune this effort isn’t necessarily meant to reduce the number of managers; rather, it’s meant to lessen the number of layers between employees and leadership. This decision comes in the aftermath of Amazon’s massive hiring spree since the pandemic.
To increase the ratio of individual contributors to managers, Amazon is exploring growing team sizes and having managers take on other roles, the spokesperson said.
Jassy and his senior leadership team are hot on the trail to lessen bureaucracy at Amazon—so much, in fact, they introduced a “bureaucracy mailbox,” where employees can submit concerns about excessive processes or rules to be addressed, according to Business Insider. Jassy has already received more than 500 emails, and the company has acted on about 150 of them.
Is it a good idea for Amazon increase its employee to manager ratio? Experts weigh in
Reducing the number of managers—especially at a company as big as Amazon—can be a slippery slope, management experts agree.
“Larger companies need some bureaucracy to control and coordinate their operations,” Moshe Cohen, a senior lecturer on management and organizations at Boston University’s Questrom School of Business, told Fortune. “Too little management results in chaos, poor coordination, inferior decisions, and too little attention to team members.”
However, Cohen agreed too much bureaucracy can slow decision-making and disconnect people from a company’s mission. “The challenge is to find the right balance and to structure the management to optimize the positives without burdening the organization or its people,” he added.
Loren Margolis, founder and chief executive coach of TLS Leaders and leadership professor at Stony Brook University, said there are only two conditions under which Amazon should consider having fewer managers. The first is if managers are underperforming, which includes micromanaging, not coaching, or not empowering employees to do their jobs independently, she told Fortune. The other condition under which Amazon should consider cutting management positions would be if it needs to cut costs and eliminate some layers to be more agile.
However, Margolis advises against reducing middle-management positions just to cut some red tape.
“Companies need to be keenly aware that eliminating middle managers can leave the company without important knowledge,” she said. “Middle managers are the key to a company's success since they empower the front line and support the senior line.”
Margolis suggests current Amazon employees concerned about their managers losing their jobs to ask as much as they can about processes, key decisions, and influential leaders at the company.
