Google and Amazon are laying off managers: How does cutting down on managerial roles impact organisations?

As the tech world faces an increasing wave of layoffs, Google‘s recent decision to slash 10% of its managerial positions has raised eyebrows across industries. CEO Sundar Pichai announced that roles including managers, directors, and vice presidents would be either eliminated or reassigned to individual contributor positions as part of a broader strategy to enhance efficiency by 20%. This move follows Amazon’s leadership shakeups.
Earlier this year, Amazon announced plans to reduce approximately 14,000 managerial positions by early 2025. This move is part of CEO Andy Jassy’s initiative to boost operational efficiency by increasing the proportion of individual contributors to managers by at least 15% by the end of Q1 2025.
These moves signal a shift towards a leaner, more agile organizational structure. But as managerial positions are getting trimmed down, a key question lingers: Will this shift truly drive productivity, or is it simply a convenient cover for larger cost-cutting measures? A recent report by UpGrad reveals that 56% of Gen Z professionals prefer consulting GenAI over their managers, highlighting the growing irrelevance of traditional leadership roles. As organizations rethink their leadership structures, it’s essential to explore how this shift could impact productivity and overall organizational health. Will removing layers of management lead to more nimble, empowered teams, or will it result in the loss of essential oversight and guidance? The implications of these changes are far-reaching, and understanding their true impact requires a closer look at how we define effective leadership in the modern workplace.

Importance of ideal manager-to-reportee ratio for organizational health

Determining the ideal manager-to-reportee ratio is crucial for the smooth and effective functioning of an organization. This ratio influences how well employees are guided, supported, and held accountable for their work.
Studies suggest that typically, one manager should be able to handle 5 to 9 employees. This range enables managers to provide sufficient attention to each individual without becoming overwhelmed, fostering better communication and development opportunities for both parties. In a more standardized work environment with experienced employees needing less supervision, the manager can handle up to 15 to 20 direct reportees. However, if employees need more direct support, this can become challenging for the manager.
A balanced structure allows organizations to maintain clear communication, foster innovation, and ensure operational efficiency. Here’s why having the right number of managers is key to organizational success:
Clear Guidance and Support
A well-balanced manager-to-reportee ratio ensures that employees receive the guidance they need without feeling micromanaged. With the appropriate number of managers, each employee can get the necessary feedback, mentorship, and direction, allowing managers to focus on team development while also maintaining enough oversight.
Efficient Decision-Making
Managers play a vital role in decision-making and problem-solving within teams. When there are too many reportees for each manager to handle effectively, decision-making becomes slower and less effective. A proper manager-to-reportee ratio ensures that decisions are made efficiently, without unnecessary delays. Managers can act quickly to resolve issues, allocate resources, and adapt strategies based on team needs and external challenges.
Accountability and Oversight
Managers help ensure accountability within their teams. With the correct number of managers, the organization can maintain a clear system of checks and balances. Each team member’s work is monitored and reviewed, ensuring that goals are met, and tasks are completed efficiently. This level of oversight prevents issues such as missed deadlines, poor performance, or a lack of coordination.
Employee Morale and Development
A manageable manager-to-reportee ratio allows managers to focus on employee development. When managers aren’t spread too thin, they can invest time in coaching, mentoring, and providing constructive feedback, which boosts employee morale and growth. Having fewer employees under each manager’s supervision makes it easier to recognize individual contributions, address concerns, and create opportunities for advancement.

Trimming managerial roles: How does it impact organisations?

While reducing managerial roles may seem like an attractive way to streamline operations, there are several potential drawbacks to eliminating managers, particularly when the right balance has not been established.
Lack of Oversight and Direction
When companies reduce their managerial workforce, the remaining managers are often expected to oversee a larger group of reportees. This can result in a lack of personal oversight and guidance for employees. With more people to manage, it becomes harder for managers to provide individual support, address performance issues, or track progress effectively. This may lead to employees feeling overlooked or unsupported, which can negatively affect productivity and morale.
Decreased Accountability
Managers play an essential role in maintaining accountability within teams. They ensure that goals are met, deadlines are adhered to, and team members are on track. Without enough managers, accountability may fall through the cracks. Employees may struggle to stay focused without the proper direction, and issues may go unnoticed until they escalate, potentially causing delays or project failures.
Slower Response Times
One of the key advantages of having managers is the speed at which decisions can be made and implemented. Without an adequate number of managers, the decision-making process may become decentralized or delayed. Employees may lack the authority to act on their own, requiring approval from higher-ups or needing more time to make decisions. This can lead to inefficiencies and missed opportunities, especially in fast-moving industries like technology.
Strain on Employee Well-Being
Managers often act as buffers between employees and the higher levels of the organization. They provide emotional support, mediate conflicts, and help manage workloads. When managerial roles are reduced, employees may feel disconnected from leadership, which can impact their overall well-being. With fewer managers available, employees may also face increased workloads, leading to burnout, stress, and a decline in job satisfaction.
Diminished Innovation and Collaboration
Managers play a pivotal role in fostering innovation within teams. They encourage brainstorming, risk-taking, and creative problem-solving. Without sufficient managerial oversight, employees may feel less empowered to take initiative or contribute ideas. Moreover, managers help facilitate collaboration across teams, ensuring that knowledge is shared and projects progress smoothly. A lack of managers may stifle communication and collaboration, ultimately affecting the organization’s ability to innovate and adapt to new challenges.