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That is a simple view of how a company works. It's much more complex than "make the results look a little better for the next quarter". Entire forecast change

That is a simple view of how a company works. It's much more complex than "make the results look a little better for the next quarter". Entire forecast change when numbers are missed. People are also hired based off those numbers. Should we also not hire more employees when the out look is better? Companies need to be healthy to continue to be able to employ at all. So yes. It is the duty to cut cost and maintain healthy balances based off future expectations. It would be far more dishonest to simply let the entire company fold effectively laying off everybody to prolong a subet of employees jobs for a little longer. But beyond that it's rare that layoffs happen for a single quarter miss. And unless you are pure EBITA driven laying off probably won't make anybody looking for revenue groth happy either. Companies are complex living organizations. The notion that laying people off is always bad is a bad notion.

YZF 8y ago
My experience from an S&P 500 tech company is that people can be laid off one quarter only for new people to be hired the next. The people making those decisions are completely disconnected from the hugely negative impact this has on the company's ability to execute. There was no real need to layoff anyone, there's plenty of cash, it's purely for engineering the business results and ultimately trying to engineer the share price. The people laid off could have been contributing immensely and the new hires contribute nothing if not negative for a while. Economic cycles are not a surprise, they happen, a company with enough resources can easily absorb them, use the down turn to double down on developing new products, and come out stronger on the other end. Laying people off isn't always bad, but at least 80% of the time it's the wrong long term decision. You've spent years on these people learning your products and technology, and now all that knowledge is gone. The impact is continuously felt years down the road. The movement of people this and a variety of other reasons is a net drag on companies. This treatment of people as some sort of "resource" that can be scaled up and down on demand is a joke. All that is not to say that if you have a problem with specific employees you can't fire them, that's a completely different question. EDIT: Lemme give you another example I witnessed personally from a multi-billion dollar company. Production of a certain (highly complex) product in was moved to Mexico for a projected cost saving of about 5%. The factory was closed, hundreds of people were laid off. Years later the production cost in Mexico was higher than the cost in the original factory and production was moved back. It was absolutely clear the original decision was iffy but it was done for the optics of making it look like the company is working on cutting costs. It impacted not only those people who got laid off but local supply chains etc. Overall a negative decision for the company, the economy, and the people involved, driven purely by bean counters with no clue. If the company did "focus on employees" and really considered the loss of know-how, the cost of recruiting and training people, the loss of trust, the impact on morale etc. maybe we would have had a different outcome.

YZF 8y ago

My experience from an S&P 500 tech company is that people can be laid off one quarter only for new people to be hired the next. The people making those decisions are completely disconnected from the hugely negative impact this has on the company's ability to execute. There was no real need to layoff anyone, there's plenty of cash, it's purely for engineering the business results and ultimately trying to engineer the share price. The people laid off could have been contributing immensely and the new hires contribute nothing if not negative for a while. Economic cycles are not a surprise, they happen, a company with enough resources can easily absorb them, use the down turn to double down on developing new products, and come out stronger on the other end. Laying people off isn't always bad, but at least 80% of the time it's the wrong long term decision. You've spent years on these people learning your products and technology, and now all that knowledge is gone. The impact is continuously felt years down the road. The movement of people this and a variety of other reasons is a net drag on companies. This treatment of people as some sort of "resource" that can be scaled up and down on demand is a joke. All that is not to say that if you have a problem with specific employees you can't fire them, that's a completely different question. EDIT: Lemme give you another example I witnessed personally from a multi-billion dollar company. Production of a certain (highly complex) product in was moved to Mexico for a projected cost saving of about 5%. The factory was closed, hundreds of people were laid off. Years later the production cost in Mexico was higher than the cost in the original factory and production was moved back. It was absolutely clear the original decision was iffy but it was done for the optics of making it look like the company is working on cutting costs. It impacted not only those people who got laid off but local supply chains etc. Overall a negative decision for the company, the economy, and the people involved, driven purely by bean counters with no clue. If the company did "focus on employees" and really considered the loss of know-how, the cost of recruiting and training people, the loss of trust, the impact on morale etc. maybe we would have had a different outcome.