MS Dismantles Senior Management Structure in Major Overhaul for AI Competition

Establishing Small, Field-Oriented Horizontal Teams

Microsoft has launched a sweeping organizational restructuring, including disbanding its existing senior executive management system, to respond to the era of artificial intelligence (AI).

On May 22 (local time), U.S. business media outlet Business Insider reported that it had obtained internal Microsoft documents revealing that CEO Satya Nadella has dissolved the Senior Leadership Team (SLT). The SLT was the core executive group, with each member leading a large organization and reporting directly to the CEO.

Recently, CEO Nadella emphasized the importance of swift decision-making and execution, stating, "Microsoft's massive scale has become a tremendous weakness in the AI era." In response, the company has adopted a new, field-driven, small-scale horizontal organizational structure, replacing its previous vertical hierarchy.

First, a new company-wide management team called the "Corporate Leadership" team has been established, consisting of five people: CEO Satya Nadella, President Brad Smith, Chief Financial Officer Amy Hood, Chief People Officer Amy Coleman, and CEO of Commercial Business Judson Althoff. This team will hold meetings at least once a week, focusing on key decisions regarding company operations and governance.

An Engineering Leadership Group, composed of 35 leaders from engineering and product divisions, has also been newly introduced. This group features a structure in which engineers, researchers, developers, and designers collaborate directly, modeled after a startup-style management approach.

The company is also undergoing a generational change and reorganization of executive roles. Yusuf Mehdi, who has served as Chief Marketing Officer for the consumer division since 2023, has decided to leave the company after a period of role reduction. Veteran Rajesh Jha, with 35 years of experience, is also expected to retire at the start of the new fiscal year in July.

To oversee the newly created AI division established in 2024, Mustafa Suleyman, who was recruited from DeepMind, has been put in charge of a "Superintelligence" organization with around 650 members.

Previously, Amazon founder Jeff Bezos criticized Microsoft by saying it was "like a country club for people who want to coast until retirement." This restructuring is widely seen as an attempt to shed that image and transform Microsoft, a giant organization with 220,000 employees, into a lighter and more agile structure to better respond to the rapidly evolving AI competition.

This content was produced with the assistance of AI translation services.