Soft centre: what do companies lose when they cut out middle managers?
Middle management is often regarded as an unnecessary layer of bureaucracy that add little productive value to an organisation. Recently, this oft-maligned management class has been the target for layoffs, as businesses look to become leaner amid the economic downturn and investor pressure.
Meta CEO Mark Zuckerberg called out middle managers directly as he aims to make 2023 the company’s “year of efficiency”. During an all-hands meeting, he reportedly said: “I don’t think you want a management structure that’s just managers managing managers, managing managers, managing the people who are doing the work.”
As a result, Zuckerberg is now “flattening” Meta’s internal hierarchy and has given managers an ultimatum: transition to contributor roles or leave the business. The hope is that by cutting out additional layers of management the company can speed up decision-making and improve productivity.
Meta is not alone in this strategy. Layoffs at FedEx have fallen mostly on managers as the company looks to become a “more efficient, agile organisation”. And, more broadly, demand for managers has seen a steep decline. Figures from the Office for National Statistics show the number of job ads for management, policy, and governance professions dropped by 55.9% between December 2021 and 2022.
Inefficiencies are everywhere
However, while many businesses have cited efficiency drives as the motivation for these cuts, removing middle managers can often have the opposite effect, according to Margaret Heffernan, professor in management at the University of Bath.
“The idea that all the inefficiency lies in one layer is stupid,” she says. “Inefficiencies are everywhere. You’ll find them at the bottom, in the middle and they will definitely be at the top.”
In her opinion, the reason middle managers have been the focus of many layoffs is the simple fact that “bosses don’t get rid of bosses”. But in doing so, they are overlooking the important role middle managers play in organisations.
“They’re seen as an easy target because their work is often quite invisible,” Heffernan says. “But they connect different parts of what can be very complicated environments and they tend to prevent misunderstanding, chaos and accidents. As a consequence, nobody sees the chaos and accidents that they helped to avoid.”
Middle managers are also uniquely placed in the space between executives and their employees. This makes them very effective at passing information both up and down the hierarchy, as well as across the organisation and between departments. “Middle managers are fantastic silo-busters,” she adds. “Those that remove them will probably find that the organisation doesn’t function quite as well as it did before.”
Gustaf Nordbäck, CEO of Headspring Executive, also thinks that businesses often overlook the work this management layer does. “They are often unfairly portrayed as the people who are responsible for slowing things down, playing politics and creating unnecessary red tape,” he says. “But they play a key role in making the vision of senior leaders happen.”
Underestimating middle managers
Despite their reputation, a recent survey of 3,400 middle managers across 10 countries conducted by the Workforce institute at UKG found that 46% say they will likely quit their job within the next 12 months due to workplace stress. These levels of burnout would suggest this group of employees is doing more work than they are often credited for.
As businesses grapple with the challenges of persistent skills gaps, shifting hybrid working patterns and inflation, the onus often falls on mid-tier bosses to manage the impacts on staff. This relationship between line managers and employees is a crucial one that companies like FedEx and Meta are overlooking, according to professor Emma Parry, head of the changing world of work group at Cranfield School of Management.
She claims that middle managers play important roles in defining workplace norms, interpreting organisational strategy, filtering messages down to employees and providing feedback from the front-line. “They are also responsible for managing performance, reviewing capabilities and they have a really crucial role in developing culture,” Parry adds.
Losing this level in the hierarchy means that employees can lose the close, trust-based relationships they develop with their line managers, while those at a more senior level could see their workloads increase, as they’re left trying to manage more people.
Removing a layer of the hierarchy also disrupts the organisation’s internal talent pipeline and reduces career progression opportunities for junior staff – something which Parry claims is particularly important for retention. “In the worst case scenario, you end up with worse communication, employees that aren’t engaged and burnt out managers,” she adds.
Flattening the pyramid
This is not to say that every organisation will suffer if it undertakes a cull of its managers. Many large organisations develop bloated management classes, for example Google’s chief people officer Fiona Cicconi recently revealed that the tech firm has 30,000 managers.
Jellyfish is one company that has rejected the traditional pyramid structure and removed line managers from the business entirely. Its CEO Rob Pierre says: “Innovative companies are always measuring, evaluating and iterating their ways of working. Eradicating the tasks associated with line management can be incredibly empowering for employees, freeing them up to focus on and share the expertise that they were originally hired for.”
However, he says that the removal of line management at his company formed part of an entirely revised operating model, which he believes needs to be in place before making this kind of fundamental change.
“It’s very hard to go from an environment that’s very hierarchical to one that’s flat,” Heffernan adds. “Hierarchies tend to attract people that like having a pecking order. If you then decide to change the entire culture and tell them status doesn’t matter anymore, that’s a really hard thing to pull off.”
This is not to say it can’t be done successfully. According to Parry, it just means “properly understanding what the implications are of taking that layer out and thinking about how you’re going to make sure the role that middle managers play is still undertaken effectively”.
While taking out a layer of the hierarchy may seem like an obvious way to create a leaner and more agile organisation, it’s important businesses don’t underestimate the role their middle managers play.