Cutting middle management is becoming increasingly popular with tech companies like Amazon, Meta, and Salesforce. They aim to flatten the organizational chart and reduce costs in the process. While it may sound like a good idea in theory, removing middle-level managers can have a long-term detrimental affect on the overall performance and effectiveness of a company.
Studies have shown that most companies that eliminate mid-management struggle with communication, collaboration, and productivity when it comes to projects and tasks. This is because middle-management teams help provide a bridge between supervisors and employees. Without such a bridge, there can be a breakdown in communication, leading to frustration and confusion. Additionally, middle managers are responsible for motivating and supporting employees through the development of strategic plans and setting clear goals.
Beyond inefficiencies in communication and morale, companies that cut middle managers generally face greater difficulty in developing business strategy and innovating over the long-term. Without dedicated middle-level teams who are able to identify new opportunities and challenge business models, companies can be less able to stay ahead of the curve and capitalize on them.
Moreover, when companies cut middle management, one of the unintended consequences is often an increase in employee turnover, as middle-level teams are often comprised of long-term staff who are seen as essential for motivation, inspiration, and support for long-term initiatives.
Twitter is a prime example of a company that has seen the benefits of middle management. Despite the feud between CEO Elon Musk and the landlord at its San Francisco headquarters, Twitter recently invested in new technology to develop a generative AI project, and purchased thousands of GPUs. Its CEO understands that such investments, innovations, and game-changing leaps require a great deal of strategic planning, which can only be fulfilled by reliable middle management teams.
It’s clear that when it comes to making decisions that impact the overall performance of a company, cutting middle management should be a last resort. Middle managers provide a bridge between employees and supervisors, create strategies and set goals, and give feedback and support to employees. Moreover, middle management teams can help a company develop creative ideas, challenge existing business models, and ultimately innovate over the long-term. It’s not just Twitter that has seen the value of middle management – many companies have benefited from the expertise and long-term support of middle managers. Overall, cutting middle management is often not a solution but a risk that can backfire.
