Business Operations

Amazon has announced plans to reduce approximately 14,000 corporate positions as part of its strategy to streamline operations and integrate new technologies. According to a communication from Beth Galetti, Senior Vice President of People Experience and Technology, the objective is to minimize bureaucracy and redirect resources to areas of primary importance for customer needs, both current and future.

Reports indicate that the total number of job cuts could increase to 30,000, reflecting efforts to manage costs and address the overhiring that occurred during the pandemic. This reduction marks the largest since 2022, when Amazon eliminated around 27,000 roles. The current cuts represent nearly 10% of the company’s 350,000 corporate employees and a small fraction of its total workforce of 1.55 million.

The affected areas include human resources, operations, devices and services, and Amazon Web Services. Managers have received training on conducting discussions with impacted staff, with notifications being sent via email.

Rationale Behind the Decision

Galetti stated that these changes are part of Amazon’s ongoing efforts to optimize management structures and enhance decision-making speed. The company aims to function like a “large startup” by reducing hierarchical layers and empowering employees.

While certain areas are downsizing, Amazon plans to continue hiring in strategic sectors. Employees whose roles are impacted will have 90 days to seek new positions within the company.

Galetti emphasized that despite strong performance, the company must adapt to rapid global changes. She highlighted artificial intelligence as a transformative technology comparable to the Internet.

Integration of AI in Amazon’s Strategy

Artificial intelligence plays a significant role in Amazon’s operations. CEO Andy Jassy has indicated that AI will lead to job reductions by automating routine tasks.

Earlier initiatives include an anonymous complaint line, resulting in approximately 450 process changes aimed at reducing unnecessary processes.

Galetti expressed confidence in Amazon’s extensive reach and its various initiatives to improve customer experiences worldwide. The company will continue to invest in AI and logistics through 2026, despite reductions in other sectors.