Block: AI Replaces Managers with 'Player-Coaches'

Jack Dorsey, co-founder of Block, and Roelof Botha, partner at Sequoia, recently co-authored a blog post outlining a radical transformation of Block's organizational structure, focused on the integration of artificial intelligence (AI). This announcement comes a month after the company reduced its workforce by 40%, which is over 4,000 employees. Dorsey explained that advancements in AI motivated this reduction, asserting that a smaller team using tools developed by Block could achieve more. The goal is to make AI not just a co-pilot, but a true intelligence, or "mini-AGI," capable of maintaining a continuously updated model of the company and coordinating work without the need for layers of middle management.

Three New Roles for a Rethought Organization

Block is introducing three types of roles for its employees:

• Individual Contributor: These employees are "deep specialists" who receive context directly from the AI model, allowing them to make decisions without managerial directives.

• Directly Responsible Individual: These employees have "specific cross-cutting problems" and have full authority to draw resources from the AI model at their discretion.

• Player-Coaches: Replacing traditional managers, these employees are responsible for "craft and people." They contribute individually while developing talent within the team.

This restructuring aims to eliminate the need for a permanent middle management hierarchy, a task now handled by the AI system.

An Ongoing Transition

While the idea of "player-coaches" was mentioned before the recent layoffs, the transition to this new model is still in its early stages. Dorsey and Botha acknowledge that this transformation will not be without challenges, with some parts of the process likely to "break before they work."

The ultimate goal of this reorganization is not just to cut costs, but to reveal the true nature of the company through AI, according to the blog's authors. This approach could potentially redefine the role of managers in tech companies in the future.

Messages reviewed by Business Insider reveal that some of these changes had been considered before the layoffs. During the first all-hands meeting after the February layoffs, discussions took place among current and former employees in a Slack group. One former employee wrote: "There are no more managers, now they are 'coaches'." Another responded: "Are they still 'player-coaches' as they called them a few weeks ago, or are we reduced to just coaches?"

A Block employee quoted someone during the call saying, "Block is intelligence." This transition to a new corporate hierarchy will take time, and Dorsey and Botha wrote that the company is "in the early stages of this transition." They added that the change will be difficult and that "some parts may break before they work." The goal, according to Dorsey and Botha, is to make AI more than just a "cost optimization story" where leaders merely cut jobs and improve margins. "AI does not strengthen your company," they wrote. "It reveals what your company truly is."