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Biggest mark of utter management failure is making too small a layoff in April (9%) and needing to do another round today. Combined that’s a 30% headcount redu

Biggest mark of utter management failure is making too small a layoff in April (9%) and needing to do another round today. Combined that’s a 30% headcount reduction since Q1-2022

xpe 4y ago
Please say more. Is the idea to get the blood-letting over with all at once?
- johnbellone 4y ago
  Yes, it’s much better to cut fast and deep one time.
  - xpe 4y ago
    All other things equal, sure. However, proper reasoning while taking into account uncertainty is not so simple. Let's do a thought experiment. Let's say you are the CEO and your estimate for the necessary layoff ranges between 2% and 11%. What to do? One and only one round of X% layoffs? What should X be? Or perhaps start with a round of 5% layoffs. The hope would be that the uncertainty decreases. Time passes. You might not need an additional round. Or if you do, it can be done more accurately.
  - CamelCaseName 4y ago
    Why? Let the proles panic and leave on their own accord, it will cost you much less in severance.
    - x86x87 4y ago
      This works short term. Long term people will remember it and you'll have problems attracting anyone to work for you.
    - rossdavidh 4y ago
      You get very little from your employees in the meantime, the ones you are still paying, as they have a much harder time concentrating, and also don't know that they have any reason to care about the company's future. The first week or two after a layoff is very glum and unproductive.
- throwawaythekey 4y ago
  If you combine layoffs the reduction in burn can be pretty significant. The exact numbers vary per company but for a startup delaying layoffs by one month can be the difference between having one year of runway remaining or one month once all is said and done. This is not the exact link I was looking for but goes into it somewhat https://www.ycombinator.com/library/3Z-advice-for-companies-with-less-than-1-year-of-runway https://www.ycombinator.com/library/3Z-advice-for-companies-...

Biggest mark of utter management failure is making too small a layoff in April (9%) and needing to do another round today. Combined that’s a 30% headcount reduction since Q1-2022

xpe 4y ago

Please say more. Is the idea to get the blood-letting over with all at once?

johnbellone 4y ago
Yes, it’s much better to cut fast and deep one time.
- xpe 4y ago
  All other things equal, sure. However, proper reasoning while taking into account uncertainty is not so simple. Let's do a thought experiment. Let's say you are the CEO and your estimate for the necessary layoff ranges between 2% and 11%. What to do? One and only one round of X% layoffs? What should X be? Or perhaps start with a round of 5% layoffs. The hope would be that the uncertainty decreases. Time passes. You might not need an additional round. Or if you do, it can be done more accurately.
- CamelCaseName 4y ago
  Why? Let the proles panic and leave on their own accord, it will cost you much less in severance.
  - x86x87 4y ago
    This works short term. Long term people will remember it and you'll have problems attracting anyone to work for you.
  - rossdavidh 4y ago
    You get very little from your employees in the meantime, the ones you are still paying, as they have a much harder time concentrating, and also don't know that they have any reason to care about the company's future. The first week or two after a layoff is very glum and unproductive.
throwawaythekey 4y ago
If you combine layoffs the reduction in burn can be pretty significant. The exact numbers vary per company but for a startup delaying layoffs by one month can be the difference between having one year of runway remaining or one month once all is said and done. This is not the exact link I was looking for but goes into it somewhat https://www.ycombinator.com/library/3Z-advice-for-companies-with-less-than-1-year-of-runway https://www.ycombinator.com/library/3Z-advice-for-companies-...