Jack Dorsey just cut nearly half of Block’s staff, and he didn’t use the usual “macroeconomic headwinds” rationale. This wasn’t a desperate move to save a sinking ship; it was an admission that technology is rapidly impacting the need for staff.
His explanation is blunt: the business is growing, but they just don’t need the people anymore. AI and “flatter” teams have changed the math.
“…we’re already seeing that the intelligence tools we’re creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company. and that’s accelerating rapidly.”
Dorsey had a choice between a quick, brutal cut or a “gradual bleed” of layoffs over several quarters. He chose the quick cut. Slow reductions can create a culture of paranoia where nobody actually works because they’re too busy updating their resumes. You can’t build anything meaningful when you’re waiting for an axe to fall.
We’re seeing the rise of the hyper-efficient company where intelligence tools do much more of the heavy lifting, and a few people can do what used to require an army.
Block’s cut is a deep one. It sure feels like a cold, Darwinian shift. Dorsey is betting that a leaner, smaller team is the only way to survive in a world where “scale” is no longer tied to head count.
He might be right, time will tell. Meanwhile the market reaction is very positive!
You must be logged in to post a comment.