Dutch giant ASML is cutting 1,700 employees—nearly 4% of its workforce—who were cut to fight bureaucratic thrombosis. According to Analytics Insight, the cleanup targets management layers: department managers, group leaders, and team leaders. The company realized that endless meetings and "coordination of coordinations" led to internal delays and customer dissatisfaction.
This is not just a reduction, but a strict inventory of human capital. As Simran Mishra explains, the internal audit revealed: management became a toxic asset suppressing production efficiency. In the USA, the scale of cuts turned out to be more modest than expected—185 positions instead of 300, but the overall strategy remains unchanged. In the summer, ASML is taking a six-week hiring pause to then aggressively attract 1,400 engineers. In essence, the company is redistributing resources in favor of "pure execution" and R&D to accelerate the production of lithography systems in the era of the AI boom.
In our view, ASML's maneuver is a clear manual for tech businesses. In a context of talent shortages in the semiconductor industry, every dollar spent on another scrum master is a dollar stolen from development. If your management levels slow down R&D cycles, it is time to eliminate them. In the race for AI infrastructure, decision-making speed is more important than the depth of organizational hierarchy. For executives, the verdict is simple: excessive management in 2026 becomes ballast that pulls the company to the bottom.