Monday.com Restructures, Sheds Management Amid AI Push
Translated & summarized from Calcalist by baba
Monday.com is restructuring its organization, reducing management layers and focusing on AI expertise, as several senior executives depart. The company is encouraging voluntary departures among middle management to flatten its hierarchy. This strategic shift follows a period of rapid growth and aims to reposition Monday.com as an AI-focused firm, though its stock has underperformed significantly. The company is hiring for AI-related roles, signaling a costly investment in its future direction.
The story in 6 lines · by baba
- Monday.com is shedding management roles and focusing on AI expertise amid organizational restructuring.
- Several senior executives, including VPs of Product and Engineering, are departing the company.
- The company aims to flatten its organizational structure by encouraging voluntary departures of middle management.
- Monday.com is actively hiring for AI-specific roles to support its new strategic direction.
- The company's stock has underperformed significantly, reflecting investor concerns about its AI transition.
- The restructuring and AI focus come after earlier layoffs and a period of rapid growth.
Software company Monday.com is undergoing a significant organizational shift, aiming to flatten its structure and focus on artificial intelligence expertise. This comes as several senior executives and managers are departing the company. Among those leaving are Orly Stern Yitzhaki (VP Product), Sergey Lyakhovetsky (VP Engineering), Sithuvan Amir (VP Product), and Lior Zaguri (Senior Director of IT), with Liron Streichman (VP Engineering) having already departed.
The company's internal sentiment suggests that a large layer of management is becoming redundant as Monday.com reorients itself in the face of AI advancements. While not planning further explicit layoffs, the company is reportedly encouraging middle management to leave voluntarily, often by reducing their teams or shifting their areas of focus away from the company's core activities. Unlike in the past, when Monday.com sought to retain employees who expressed a desire to leave, the company now welcomes departures.
This strategic move aims to streamline the organizational hierarchy, which reportedly became bloated during the company's rapid growth post-IPO in 2021. The goal is to reduce management layers, with more employees reporting directly to senior executives, particularly the CTO. Concurrently, Monday.com is actively advertising numerous open positions, signaling a pivot towards becoming an AI-centric company. The company has announced an AI agent platform designed to manage work within organizations, though investor confidence remains shaken, reflected in a 37% stock decline since the start of 2026.
Monday.com is seen as a prominent example of the challenges facing SaaS (Software as a Service) companies in the AI era, with concerns that AI may render many software applications obsolete. While the broader software sector has seen some recovery, Monday.com and Wix have lagged behind competitors like Atlassian, whose stock has seen significant gains. The company's upcoming financial reports are expected to detail significant expenses related to severance packages and increased R&D investment, particularly in AI talent. The company is seeking individuals with AI experience, including product and development roles, and "Forward Deployed Engineers" to assist clients with AI solutions, a costly endeavor in a competitive market.
The current stock price, near its year-to-date low, offers potential for rebound if the company's transformation succeeds. However, significant equity compensation will likely be necessary, especially given the recent, highly publicized compensation increases for co-CEOs Roi Mann and Eran Zinman, which occurred alongside earlier layoffs.
Mentioned
