{"id":248853,"date":"2024-11-20T09:54:47","date_gmt":"2024-11-20T09:54:47","guid":{"rendered":"https:\/\/www.aihr.com\/?post_type=hr-glossary&#038;p=248853"},"modified":"2024-11-20T09:54:49","modified_gmt":"2024-11-20T09:54:49","slug":"delayering","status":"publish","type":"hr-glossary","link":"https:\/\/www.aihr.com\/hr-glossary\/delayering\/","title":{"rendered":"Delayering"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\" id=\"h-what-is-delayering\">What is delayering?<\/h2>\n\n\n\n<p>Delayering is the process of reducing the number of management layers in an organization to create a flatter hierarchical structure. The method may involve removing middle managers, decentralizing decision-making, or merging similar functions and departments. The main goals of delayering are to improve operational efficiency, organizational agility, collaboration, and communication.<\/p>\n\n\n\n<p>This practice is commonly used in larger organizations with complex structures, where too many layers can lead to inefficiencies. However, managing the change carefully is crucial to ensure employees aren\u2019t overburdened with additional responsibilities after roles are consolidated.<\/p>\n\n\n\n<p>HR plays a key role in organizational delayering, from identifying redundant management layers to overseeing change communication and adjusting compensation structures to fit the new model.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-downsizing-vs-delayering\">Downsizing vs. delayering<\/h2>\n\n\n\n<p>Here are some of the key differences between downsizing and delayering:<\/p>\n\n\n<div class=\"gutenberg-table-holder\">\n                                                                   <style>\n                                       .gutenberg-table-item-content-single::after {\n                                             background-color: #b0e7ff;\n                                        }\n                                  <\/style>\n                                                                    <div class=\"gutenberg-table-inner\">\n                                                           \t                         <div class=\"gutenberg-table-item\">\n                                                                                                             <div class=\"gutenberg-table-item-header\" style=\"background-color:#b0e7ff\">\n                                                                                                                           <div class=\"gutenberg-table-item-header-single\" style=\"width:20%\">\n                                                                                                                                            <\/div>\n                                                                                                                                                                                        <div class=\"gutenberg-table-item-header-single\" style=\"width:40%\">\n                                                                     Delayering                                                                <\/div>\n                                                                                                                                                                                        <div class=\"gutenberg-table-item-header-single\" style=\"width:40%\">\n                                                                     Downsizing                                                                <\/div>\n                                                                                                                    <\/div>\n                                                                                                                                                                             <div class=\"gutenberg-table-item-content   have-header-table\">\n                                                                                                                                                                    <div class=\"gutenberg-table-item-content-item\" style=\"border-color:#b0e7ff\">\n                                                                                                                                                                                            <div class=\"gutenberg-table-item-content-single\" style=\"width:20%; border-color:#b0e7ff\"   header-item=\"       \" >\n                                                                                                    <p><strong>Definition<\/strong><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%; border-color:#b0e7ff\"   header-item=\"Delayering\" >\n                                                                                                    <p>Reducing the number of management layers to create a flatter hierarchy.<\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%\"   header-item=\"Downsizing\" >\n                                                                                                    <p>Reducing the overall number of employees to cut costs or streamline operations.<\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                    <\/div>\n                                                                                                                                                                            <div class=\"gutenberg-table-item-content-item\" style=\"border-color:#b0e7ff\">\n                                                                                                                                                                                            <div class=\"gutenberg-table-item-content-single\" style=\"width:20%; border-color:#b0e7ff\"   header-item=\"       \" >\n                                                                                                    <p><b>Main goals<\/b><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%; border-color:#b0e7ff\"   header-item=\"Delayering\" >\n                                                                                                    <p>Improved communication, faster decision-making, enhanced agility.<\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%\"   header-item=\"Downsizing\" >\n                                                                                                    <p><span style=\"font-weight: 400;\">Cost savings, increased efficiency, survival during financial challenges.<\/span><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                    <\/div>\n                                                                                                                                                                            <div class=\"gutenberg-table-item-content-item\" style=\"border-color:#b0e7ff\">\n                                                                                                                                                                                            <div class=\"gutenberg-table-item-content-single\" style=\"width:20%; border-color:#b0e7ff\"   header-item=\"       \" >\n                                                                                                    <p><b>Employees impacted<\/b><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%; border-color:#b0e7ff\"   header-item=\"Delayering\" >\n                                                                                                    <p><span style=\"font-weight: 400;\">Focus on removing middle management roles.<\/span><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%\"   header-item=\"Downsizing\" >\n                                                                                                    <p><span style=\"font-weight: 400;\">Can affect employees across all levels, not limited to management.<\/span><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                    <\/div>\n                                                                                                                                                                            <div class=\"gutenberg-table-item-content-item\" style=\"border-color:#b0e7ff\">\n                                                                                                                                                                                            <div class=\"gutenberg-table-item-content-single\" style=\"width:20%; border-color:#b0e7ff\"   header-item=\"       \" >\n                                                                                                    <p><b>Potential negative consequences<\/b><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%; border-color:#b0e7ff\"   header-item=\"Delayering\" >\n                                                                                                    <p><span style=\"font-weight: 400;\">Increased workload, reduced oversight, lack of career advancement opportunities.<\/span><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%\"   header-item=\"Downsizing\" >\n                                                                                                    <p><span style=\"font-weight: 400;\">Job loss and reduced productivity, morale, and innovation.<\/span><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                    <\/div>\n                                                                                                                                                                            <div class=\"gutenberg-table-item-content-item\" style=\"border-color:#b0e7ff\">\n                                                                                                                                                                                            <div class=\"gutenberg-table-item-content-single\" style=\"width:20%; border-color:#b0e7ff\"   header-item=\"       \" >\n                                                                                                    <p><strong>Examples of actions taken<\/strong><\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%; border-color:#b0e7ff\"   header-item=\"Delayering\" >\n                                                                                                    <p>Removing middle management, merging departments, redistributing responsibilities.<\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                                                                                                                        <div class=\"gutenberg-table-item-content-single\" style=\"width:40%\"   header-item=\"Downsizing\" >\n                                                                                                    <p>Layoffs, voluntary severance, early retirement incentives.<\/p>\n                                                                                                <\/div>\n                                                                                                                                                                                    <\/div>\n                                                                                    \t\t                                                               <\/div>\n                                                                                                  <\/div>\n                                         \t\t                           <\/div>\n                          <\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-advantages-and-disadvantages-of-delayering\">Advantages and disadvantages of delayering<\/h2>\n\n\n\n<p>Like most organizational processes that involve restructuring, delayering has benefits and downsides. These include:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-advantages\">Advantages<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Faster decision-making:<\/strong> With fewer managerial layers, key decisions can be made quicker, reducing delays and increasing agility to enable faster response to changes.<\/li>\n\n\n\n<li><strong>Cost savings:<\/strong> Reducing the number of managers or merging functions and departments can significantly lower payroll and overhead costs.<\/li>\n\n\n\n<li><strong>Increased employee autonomy:<\/strong> With reduced managerial input, employees may gain more control and responsibility over their work.<\/li>\n\n\n\n<li><strong>Better communication: <\/strong>Fewer hierarchy levels typically result in more transparent and streamlined communication. Employees also have the opportunity to communicate directly with decision-makers.<\/li>\n\n\n\n<li><strong>Cultural shift toward openness: <\/strong>Delayering can foster a less hierarchical, more open culture where employees feel closer to leadership and more engaged in the organization\u2019s direction.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-disadvantages\">Disadvantages<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Risk of overloading managers: <\/strong>The remaining managers may have to assume broader control and oversee more direct reports, which can lead to managerial burnout and less effective supervision.<\/li>\n\n\n\n<li><strong>Employee uncertainty:<\/strong> Those with restructured roles or responsibilities may experience anxiety adjusting to their new positions, or uncertainty about their future career paths in the organization.<\/li>\n\n\n\n<li><strong>Initial period of lower productivity:<\/strong> Removing managerial layers may cause an initial period of disruption, lowering overall productivity as employees adjust to the new organizational structure.<\/li>\n\n\n\n<li><strong>Not suitable for all organizations:<\/strong> Delayering may not work well if an organization does not have a workforce prepared to take on more responsibilities or work without direct managerial guidance.<\/li>\n\n\n\n<li><strong>Widen <a href=\"https:\/\/www.aihr.com\/blog\/skills-gap-analysis\/\">skills gaps<\/a>:<\/strong> If not properly planned, the delayering process may result in a loss of valuable skills and expertise from the loss of certain managers in their roles.<\/li>\n<\/ul>\n\n\n<div class=\"gaihrpl gaihrpl-14\"><div class=\"gaihrpl-single aaihrpl-144\"><a class=\"gofollow\" data-track=\"MTQ0LDE0LDYwMA==\" href=\"https:\/\/www.aihr.com\/courses\/organizational-development-certification\/?il_id=banner&#038;il_name=odcp&#038;il_creative=odcp-modules&#038;il_position=slot2\" target=\"_blank\" rel=\"nofollow\" style=\"display:block;padding-top:20px;\"><img decoding=\"async\" src=\"https:\/\/www.aihr.com\/wp-content\/plugs\/podcast-blog-ads-fade.jpg\" srcset=\"https:\/\/www.aihr.com\/wp-content\/uploads\/ODCP-Banner-Modules.png 360w, https:\/\/www.aihr.com\/wp-content\/uploads\/ODCP-Banner-Modules.png 360w, https:\/\/www.aihr.com\/wp-content\/uploads\/ODCP-Banner-Modules.png 700w, https:\/\/www.aihr.com\/wp-content\/plugs\/ w\" sizes=\"(max-width: 480px) 360px, (max-width: 960px) 360px, (max-width: 1280px) 700px, 750px\" style=\"box-shadow: 0px 0px 20px 5px rgb(46 61 73 \/ 15%);display: block;margin: auto; border-radius:19px;\" class=\"small_ad\" \/><\/a>\r\n<br><\/div><\/div>\n\n\n<h2 class=\"wp-block-heading\" id=\"h-examples-of-delayering\">Examples of delayering<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-example-1-general-electric\">Example 1: General Electric<\/h3>\n\n\n\n<p>Former GE CEO Jack Welch was well known for his efforts to flatten the organization&#8217;s hierarchy. In the late 1980s and beyond, he sought to reduce the number of managerial layers at the corporate and business levels. According to one estimate, the company saved $40 million in administrative costs by removing top management layers. As a result of the delayering process, some key business sectors directly reported to Welch instead of to middle managers and supervisors.<\/p>\n\n\n\n<p>Organizational delayering at GE significantly broadened managers\u2019 responsibilities and the number of direct reports. Welch believed delayering improved decision-making. \u201cI think people take more responsibility for their actions when they\u2019re the last signature,\u201d <a href=\"https:\/\/www.latimes.com\/archives\/la-xpm-1988-06-01-fi-3624-story.html\" target=\"_blank\" rel=\"noreferrer noopener\">he said<\/a>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-example-2-amazon\">Example 2: Amazon<\/h3>\n\n\n\n<p><a href=\"https:\/\/www.aboutamazon.com\/news\/company-news\/ceo-andy-jassy-latest-update-on-amazon-return-to-office-manager-team-ratio\" target=\"_blank\" rel=\"noreferrer noopener\">Amazon<\/a> CEO Andy Jassy recently announced an initiative to reduce the company&#8217;s managerial layers. Amazon will aim to increase the ratio of individual contributors to managers by at least 15% by the end of Q1 2025. According to Jassy, the main goal of this initiative is for Amazon to \u201coperate like the world&#8217;s largest startup\u201d. Through the delayering process, Amazon seeks to increase agility, decrease bureaucracy, and enhance decision-making to improve the customer experience.<\/p>\n\n\n\n<figure data-wp-context=\"{&quot;imageId&quot;:&quot;69fa9ff2ed91c&quot;}\" data-wp-interactive=\"core\/image\" data-wp-key=\"69fa9ff2ed91c\" class=\"wp-block-image size-large wp-lightbox-container\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"1024\" data-wp-class--hide=\"state.isContentHidden\" data-wp-class--show=\"state.isContentVisible\" data-wp-init=\"callbacks.setButtonStyles\" data-wp-on--click=\"actions.showLightbox\" data-wp-on--load=\"callbacks.setButtonStyles\" data-wp-on-window--resize=\"callbacks.setButtonStyles\" src=\"https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-1024x1024.png\" alt=\"\" class=\"wp-image-249079\" srcset=\"https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-1024x1024.png 1024w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-300x300.png 300w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-150x150.png 150w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-768x768.png 768w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-400x400.png 400w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-510x510.png 510w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-200x200.png 200w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-24x24.png 24w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-48x48.png 48w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-96x96.png 96w, https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog.png 1080w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><button\n\t\t\tclass=\"lightbox-trigger\"\n\t\t\ttype=\"button\"\n\t\t\taria-haspopup=\"dialog\"\n\t\t\taria-label=\"Enlarge\"\n\t\t\tdata-wp-init=\"callbacks.initTriggerButton\"\n\t\t\tdata-wp-on--click=\"actions.showLightbox\"\n\t\t\tdata-wp-style--right=\"state.imageButtonRight\"\n\t\t\tdata-wp-style--top=\"state.imageButtonTop\"\n\t\t>\n\t\t\t<svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"12\" height=\"12\" fill=\"none\" viewBox=\"0 0 12 12\">\n\t\t\t\t<path fill=\"#fff\" d=\"M2 0a2 2 0 0 0-2 2v2h1.5V2a.5.5 0 0 1 .5-.5h2V0H2Zm2 10.5H2a.5.5 0 0 1-.5-.5V8H0v2a2 2 0 0 0 2 2h2v-1.5ZM8 12v-1.5h2a.5.5 0 0 0 .5-.5V8H12v2a2 2 0 0 1-2 2H8Zm2-12a2 2 0 0 1 2 2v2h-1.5V2a.5.5 0 0 0-.5-.5H8V0h2Z\" \/>\n\t\t\t<\/svg>\n\t\t<\/button><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-7-steps-to-implement-an-effective-delayering-process\">7 steps to implement an effective delayering process<\/h2>\n\n\n\n<p>Delayering implementation in your organization would depend on its unique needs and values. However, here are seven key steps you can take to implement an effective delayering process:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Assess the current organizational structure:<\/strong> Start by assessing the existing hierarchy to identify redundancies and inefficiencies. This includes mapping out roles, responsibilities, and spans of control to pinpoint where layers could be removed without sacrificing functionality.<\/li>\n\n\n\n<li><strong>Engage leadership and key stakeholders:<\/strong> Secure buy-in from top leadership and relevant department heads. Communicate the strategic purpose of delayering to ensure everyone understands how the changes will benefit the organization in terms of agility, communication, and cost-efficiency.<\/li>\n\n\n\n<li><strong>Develop a clear <a href=\"https:\/\/www.aihr.com\/blog\/hr-change-management\/\">change management<\/a> plan: <\/strong>Delayering is a significant change, so HR should create a structured plan to manage it. This includes defining timelines, key milestones, communication strategies, and support resources for affected employees.<\/li>\n\n\n\n<li><strong>Redefine roles and responsibilities:<\/strong> Once layers are removed, clearly outline new responsibilities and reporting structures. It\u2019s essential to ensure each role is well-defined to prevent overlapping duties and gaps in accountability.<\/li>\n\n\n\n<li><strong>Implement training and support programs:<\/strong> With broader spans of control and increased responsibilities, managers and employees may require <a href=\"https:\/\/www.aihr.com\/blog\/upskilling\/\">upskilling<\/a> or <a href=\"https:\/\/www.aihr.com\/blog\/reskilling\/\">reskilling<\/a>. Provide targeted training to prepare them for their new or expanded roles.<\/li>\n\n\n\n<li><strong>Communicate transparently and regularly:<\/strong> Regular communication can ease concerns, especially since delayering often raises questions about job security and workload. Clearly explain the process, address employee questions, and update the organization on each phase\u2019s progress.<\/li>\n\n\n\n<li><strong>Evaluate the outcomes and refine the structure:<\/strong> Once delayering is implemented, track key metrics to assess its impact on efficiency, decision-making speed, and employee engagement. Gather feedback from employees and adjust the new structure as necessary.<\/li>\n<\/ol>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<h4 class=\"wp-block-heading\" id=\"h-hr-tip\"><strong>HR tip<\/strong><\/h4>\n\n\n\n<p>Before your organization initiates a widespread delayering initiative, consider conducting a test pilot with different teams or departments to determine employee readiness and get their feedback. Together with managers, HR teams can assess delayering pilot projects, focusing on whether employees have the right skills for cross-functional collaboration, effective decision-making, and adaptability to change.<\/p>\n<\/blockquote>\n","protected":false},"parent":0,"menu_order":0,"template":"","hr_glossary_category":[590],"class_list":["post-248853","hr-glossary","type-hr-glossary","status-publish","hentry","hr_glossary_category-organizational-development","description-off"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.4 (Yoast SEO v27.4) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>What Is Delayering? Definition &amp; Examples | HR Glossary - AIHR<\/title>\n<meta name=\"description\" content=\"Delayering is the process of reducing layers in an organizational hierarchy to streamline decision-making and improve efficiency.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.aihr.com\/hr-glossary\/delayering\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Delayering\" \/>\n<meta property=\"og:description\" content=\"Delayering is the process of reducing layers in an organizational hierarchy to streamline decision-making and improve efficiency.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.aihr.com\/wp-json\/wp\/v2\/hr-glossary\/248853\" \/>\n<meta property=\"og:site_name\" content=\"AIHR\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/analyticsinhr\/\" \/>\n<meta property=\"article:modified_time\" content=\"2024-11-20T09:54:49+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.aihr.com\/wp-content\/uploads\/Delayering-Blog-1024x1024.png\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:site\" content=\"@AnalyticsinHR\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.aihr.com\\\/hr-glossary\\\/delayering\\\/\",\"url\":\"https:\\\/\\\/www.aihr.com\\\/hr-glossary\\\/delayering\\\/\",\"name\":\"What Is Delayering? 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