Andy Jassy, CEO of Amazon: "Because of Organizational Culture"
Amazon, the world's largest e-commerce company, which recently announced layoffs affecting 14,000 employees, has stated that the decision was due to "organizational culture," not cost-cutting measures or artificial intelligence (AI).
On October 31, Yonhap News, citing CNN, reported remarks by Andy Jassy, Chief Executive Officer of Amazon. During an analyst conference call following the company's earnings announcement, Jassy said the layoffs were "not for financial reasons, nor are they due to artificial intelligence (AI) at this time."
Amazon is the second-largest employer in the United States after Walmart. Globally, the company employs more than 1.54 million people, with about 350,000 working at its headquarters. However, Amazon recently announced plans to lay off 14,000 employees.
Jassy explained that the layoffs are intended to make Amazon more nimble, as the company has grown too large and multiple departments have become redundant, leading to decision-making challenges. He stated, "There are now far more people and organizational layers than before. As a result, the sense of ownership among those actually doing the work can unintentionally weaken."
He added, "This can lead to a slowdown in speed from a leadership perspective. We want to operate like the world's largest startup, which means we need to reduce organizational layers."
Some media outlets have reported that the number of layoffs at Amazon could rise to as many as 30,000 employees, which would be the largest in the company's history. Although Jassy denied that AI was the cause of the layoffs, concerns are growing that technology could replace workers.
Previously, in June, Jassy had indicated that layoffs would continue over the next several years due to the adoption of AI. In an internal memo to employees, he stated, "Some of the roles we currently have will require fewer people, while other roles will require more staff."
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