In all-hands meeting, Amazon CEO says RTO mandate not a 'backdoor layoff'
NEWS | 20 November 2024
Business Insider obtained a recording of Amazon CEO Andy Jassy's latest all-hands meeting. Jassy said Amazon's RTO policy is not a 'backdoor layoff' strategy. The RTO policy aims to strengthen company culture, not cut costs, he said. Amazon employees have speculated that the company's strict return-to-office policy is part of a "quiet firing" strategy and the result of a secret agreement with cities that need to boost their local economies. Not true, according to Amazon's CEO Andy Jassy. During an internal all-hands meeting on Tuesday, Jassy denied those rumors, saying he understands it is a big "adjustment" the company needs to work through, according to a recording of the meeting obtained by Business Insider. "This was not a cost play for us. This is very much about our culture and strengthening our culture," Jassy said, adding that the only city Amazon notified ahead of time about its RTO mandate was Seattle. Amazon announced in September that most corporate employees will have to come into the office 5 days a week, starting in January. The announcement sparked fierce pushback from some employees. It also stoked rumors of the mandate being a stealth ploy to cull the workforce without a large formal layoff. Amazon Web Services CEO Matt Garman said in a staff meeting last month that 9 out of 10 Amazon employees he'd spoken with were "excited" by the change. Still, more than 500 employees recently signed an internal petition protesting the new RTO policy. When asked for comment, an Amazon spokesperson pointed to Jassy's memo from when the company announced the new RTO announcement. 'Most remarkable company in the history of business' At Tuesday's meeting, Jassy reiterated his belief that working in the same physical space can foster better innovation and work culture. He also said his eventual hope is that leadership won't have to track individual badging data and other workarounds. He added that employees will be able to work remotely when they are sick or need to repair something at home. These moves are important for Amazon because of the rapidly changing nature of technology and intensifying competition, especially in the artificial intelligence field, Jassy said. Only a few companies survive for 50 or 100 years in the tech industry because "the world changes, technology changes, competitors change, companies change," he said. "We have a chance to build the most remarkable company in the history of business," Jassy said. "But I also would say that I'm not sure that there's been a more important time in the history of this company with the way technology is changing, especially with AI, for us to be well set up to innovate together and to collaborate together and to be connected to one another and to understand the culture, and that's what we're optimizing for." Related stories 'I hate bureaucracy' Jassy also addressed the company's decision to increase the ratio of individual contributors to managers by at least 15% by the first quarter of 2025. Amazon hired so many people during the pandemic that it added "a lot more layers" to the company, he said. Having more management layers meant it took longer to get things done, and simple approvals went through multiple people. It created more bureaucracy. Having fewer managers can potentially fix this, he said. As part of this, Amazon also announced a new "Bureacracy Mailbox" last month, where employees can send unnecessary and excessive processes or rules that need to be fixed. On Tuesday, Jassy told employees that he has received more than 500 emails through this bureaucracy inbox, and the company has taken action on over 150 of those suggestions. "The reality is that the S team and I hate bureaucracy," Jassy said, referring to Amazon's most senior leadership team. "One of the reasons I'm still at this company is because it's not a political or bureaucratic place." Do you work at Amazon? Got a tip?
Author: Eugene Kim.
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