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The End of Managers? What Big Tech Flattening Means You and the Industry
The tech industry is undergoing a major transformation as some of the biggest names are flattening their organizations and getting rid of managers. Will more companies follow?
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Is the traditional hierarchy of tech companies becoming a thing of the past? Some major players in the industry, like Shopify and Meta, are shaking things up by flattening their organizations and asking managers to become individual contributors or leave the company. What does this mean for the industry and people? Let's explore.
Why are they doing this?
Some big tech companies are following a trend of flattening their organization structure, which means reducing the number of layers of management and empowering individual contributors to make decisions and take ownership of their work. This can have several benefits, such as:
Faster decision-making and execution, as there are fewer layers of bureaucracy and approval.
Lower costs and higher efficiency, as there are fewer salaries to pay and less duplication of work.
More empowerment and autonomy for employees, as they have more direct access to senior leaders and more responsibility for their work.
Sounds good? Well, not so fast. There are also some risks involved in this approach.
What are the risks?
Flattening the organization can also have some drawbacks, such as:
Reduced morale, culture, and performance, as middle managers play a vital role in motivating, developing, and retaining talent and fostering collaboration and communication across teams.
Increased workload and stress for senior leaders and employees, as they have to take on more tasks and roles that middle managers previously handled.
Decreased innovation and quality, as middle managers act as brokers of ideas and feedback between different levels and functions of the organization.
Creating confusion and ambiguity about roles and responsibilities
Reducing career advancement opportunities for high-performing individual contributors
These risks can be mitigated by providing clear expectations, guidance, support, and feedback to individual contributors and creating alternative career paths and rewards for them. However, this can work only with a specific type of culture. And it will still require a significant effort and commitment from the company and the employees.
Is this the trend in big tech?
Some big tech companies like Meta, Shopify, Twitter, Google, Amazon, and Microsoft have reduced the number of middle managers in recent years. This suggests that this is not a temporary fad but a long-term shift in how tech companies operate and compete in the market.
My take on it
While smaller and flatter organizations generally operate better, getting rid of good managers can be a double-edged sword. Good managers amplify the work of their people.
In good companies, you don’t need more managers. You need better managers.
Instead of firing their managers, some companies ask them to “step back” to individual contributor roles. The issue is that management and IC are different tracks, so it’s not a step back. Great engineers are rarely great managers. Great managers are not great because they were great coders.
So is flattening the honest answer here?
A few other potential explanations:
The tech industry underwent rapid hiring during the pandemic when demand for online services and e-commerce surged, but now they need to adjust to a post-pandemic reality and reduce their costs.
The current geopolitical and economic landscape makes companies want to reduce their costs even more.
Our industry can be influenced by social contagion, in which companies imitate what others are doing without much evidence or rationale, creating a domino effect of layoffs.
Ultimately it can play out differently for different companies. It depends on their culture, the leaders left in the team, and how severe they will go with these cuts.
I am in a management position. Now what?
Engineering managers and directors affected by this change might face challenges finding new jobs or roles matching their skills and interests. They might have to compete with a larger pool of candidates with more recent hands-on experience or technical expertise. They might also have to adjust their expectations and preferences about what kind of work they want to do and where they want to do it.
How to prepare?
If you are an engineering manager or director facing this situation, don't panic. There are still ways to prepare yourself for the future and make the most of this opportunity. Here are some tips:
Stay hands-on as much as possible. Keep your technical skills sharp and up-to-date by working on projects, learning new tools, taking courses, or contributing to open source. This will help you demonstrate your value as an individual contributor and increase your chances of landing a new role or project.
Expand your network and reach out to other engineering managers and directors who have gone through this transition. Learn from their experiences, insights, advice, and referrals. You might find new opportunities or connections that you didn't know existed.
Explore different options and possibilities. Don't limit yourself to one type of role or company. Be open-minded and curious about what else is out there. You might discover new passions or interests that you didn't realize before.
Be flexible and adaptable. Don't resist or resent the change; embrace it as a chance to grow and evolve. Be willing to try new things, take risks, make mistakes, learn from them, and improve yourself. Some companies may (partially) revert their decision to reduce the number of middle managers.
Flattening the organization structure of tech companies is a complex and controversial topic with pros and cons. Some companies might benefit from it, while others might suffer from it. The tech industry is constantly evolving and changing, as are its leaders' and workers' roles and expectations.
What do you think about reducing the number of managers inside product and engineering organizations?
What do you think will be the next trend in tech organizations?
Are you preparing somehow?
Share your thoughts and opinions in the comments below. 👇