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Companies have every incentive to fire their productive employees that know their product and processes well and who they desperately need to expand their busin

Companies have every incentive to fire their productive employees that know their product and processes well and who they desperately need to expand their business ... hoping to maybe weaken the negotiation position of future employees they may or may not hire at some point in the future? Sorry, that contains a healthy dose of "trust me, all managers are complete idiots who would rather spend a million on hiring new people than spend 10k on retaining their employees".

chank 4y ago
Problem is, in large companies, managers are so focused on short-term outlook they don't really consider or care about long-term implications.
vgatherps 4y ago
> Sorry, that contains a healthy dose of "trust me, all managers are complete idiots who would rather spend a million on hiring new people than spend 10k on retaining their employees". Empirically this view is valid. The managers themselves don't even need to be stupid. A bad incentive structure (or even interaction of locally-reasonable ones) might reward bad behavior.
- luckylion 4y ago
  In all companies, and conveniently only when layoffs are affected? I have some doubts. Most people think their own contributions are invaluable, and when they or someone in a similar position get laid off, that challenges that self-image and the obvious explanation is: their perception is completely accurate, but the others are idiots and cannot see it, or they see it, but are ruled by perverse incentives that make them kill the company instead of doing The Right Thing (i.e. keeping and promoting the employee). It's understandable, but I don't see much value in that line of thinking.
rob74 4y ago
Companies have every incentive to look good in the eyes of their shareholders, and not cutting costs when everybody else is doing it doesn't look good. And most managers would say that firing 10% of their staff (supposedly the worst performers) would not affect the productivity of the company much. What they fail to consider is the "middle finger" mentioned at the end of the article - even the most naive employee is now aware that the phrases of "employees are our most important asset" are just so much BS, and will act accordingly.
- TeMPOraL 4y ago
  > What they fail to consider is the "middle finger" mentioned at the end of the article - every employee is now aware that the phrases of "employees are are most important asset" are just so much BS, and will act accordingly. It may not work out well for the employees, though: once everyone stops pretending to care, the companies will be less worried about someone else giving you a better offer, so your negotiating leverage may just go down the drain.
- screwturner68 4y ago
  I know EMC used to fire 10% of their workforce every year, it was stupid but that's what they did. My question is if these people hadn't been pulling their weight why did you wait so long to chop their head? I see it at my company where groups will keep dead weight around just so they have someone to fire when management wants a head, again it's silly but it's better than having to fire a productive worker that actually will effect the bottom line if they get fired.
stuaxo 4y ago
Managers incentives are not automatically aligned with "the companies" incentives (for a simplified version where "the company" wants only profit). Company being just a big bag of people - at different levels, there are all sorts of different incentives going on.
watwut 4y ago
To be frank, managerial positions have super low accountability. Their career successes and failures are disconnected from their ability to lead the teams. They don't need to be stupid to make decisions that do not benefit companies they work for. They might just read incentives they operate under right.
ravingraven 4y ago
For many companies this is counter-intuitive but true. Companies (just like people) are not fully rational economic actors. A lot of the decision-making in companies revolves around power-plays and revenge. Managers fire people they don't like or they feel they do not have leverage over all the time. In a sufficiently large team/company, it is trivial to portray a good performer as a bad one and vice versa. Managers (including CEOs) are just as sexist/racist as anyone and do promote based on biases and personal feelings. Managment greatly enjoys the feeling of power they have over people and I don't think it is absurd to say that they are fed up with the current dynamic that takes part of this away from them and are firing people just to create an atmosphere of fear.
- luckylion 4y ago
  > I don't think it is absurd to say that they are fed up with the current dynamic that takes part of this away from them and are firing people just to create an atmosphere of fear. But it's been that way forever in tech companies: SWE make enormous amounts of money and can control their work + environment a lot. In the world where corporations function like torture dungeons and managers are running around looking for opportunities to satisfy their sadist urges, how would the boom cycles ever happen where employees get whatever they ask for and 5 years of work straight out of university can get you enough money to retire to a modest life without ever lifting another finger. Managers are all bipolar? Do they have meetings where they coordinate when to lure the people in and then all release their hate at once for maximum effect? That just doesn't make a lot of sense to me whereas the cyclic nature of the economy and the external stimulus through a) everyone being in their homes a lot more because of the pandemic, and b) money pouring in like crazy because of the central banks explains both the aggressive hiring (during hard upswings and cheap money) as well as the trimming (during downturns and less cheap money). If it's one company, sure, it may be because of some manager hating people. But pretty much all companies with the exception of Apple (so far, and who also only indirectly employs a lot of their people, so they don't fire them, they just terminate the contracts with their employers, who then fire them)? That would need coordination beyond "monkey see, monkey do".
  - Jensson 4y ago

chank 4y ago

Problem is, in large companies, managers are so focused on short-term outlook they don't really consider or care about long-term implications.

vgatherps 4y ago

> Sorry, that contains a healthy dose of "trust me, all managers are complete idiots who would rather spend a million on hiring new people than spend 10k on retaining their employees". Empirically this view is valid. The managers themselves don't even need to be stupid. A bad incentive structure (or even interaction of locally-reasonable ones) might reward bad behavior.

luckylion 4y ago
In all companies, and conveniently only when layoffs are affected? I have some doubts. Most people think their own contributions are invaluable, and when they or someone in a similar position get laid off, that challenges that self-image and the obvious explanation is: their perception is completely accurate, but the others are idiots and cannot see it, or they see it, but are ruled by perverse incentives that make them kill the company instead of doing The Right Thing (i.e. keeping and promoting the employee). It's understandable, but I don't see much value in that line of thinking.

rob74 4y ago

Companies have every incentive to look good in the eyes of their shareholders, and not cutting costs when everybody else is doing it doesn't look good. And most managers would say that firing 10% of their staff (supposedly the worst performers) would not affect the productivity of the company much. What they fail to consider is the "middle finger" mentioned at the end of the article - even the most naive employee is now aware that the phrases of "employees are our most important asset" are just so much BS, and will act accordingly.

TeMPOraL 4y ago
> What they fail to consider is the "middle finger" mentioned at the end of the article - every employee is now aware that the phrases of "employees are are most important asset" are just so much BS, and will act accordingly. It may not work out well for the employees, though: once everyone stops pretending to care, the companies will be less worried about someone else giving you a better offer, so your negotiating leverage may just go down the drain.
screwturner68 4y ago
I know EMC used to fire 10% of their workforce every year, it was stupid but that's what they did. My question is if these people hadn't been pulling their weight why did you wait so long to chop their head? I see it at my company where groups will keep dead weight around just so they have someone to fire when management wants a head, again it's silly but it's better than having to fire a productive worker that actually will effect the bottom line if they get fired.

stuaxo 4y ago

Managers incentives are not automatically aligned with "the companies" incentives (for a simplified version where "the company" wants only profit). Company being just a big bag of people - at different levels, there are all sorts of different incentives going on.

watwut 4y ago

To be frank, managerial positions have super low accountability. Their career successes and failures are disconnected from their ability to lead the teams. They don't need to be stupid to make decisions that do not benefit companies they work for. They might just read incentives they operate under right.

ravingraven 4y ago

For many companies this is counter-intuitive but true. Companies (just like people) are not fully rational economic actors. A lot of the decision-making in companies revolves around power-plays and revenge. Managers fire people they don't like or they feel they do not have leverage over all the time. In a sufficiently large team/company, it is trivial to portray a good performer as a bad one and vice versa. Managers (including CEOs) are just as sexist/racist as anyone and do promote based on biases and personal feelings. Managment greatly enjoys the feeling of power they have over people and I don't think it is absurd to say that they are fed up with the current dynamic that takes part of this away from them and are firing people just to create an atmosphere of fear.

luckylion 4y ago
> I don't think it is absurd to say that they are fed up with the current dynamic that takes part of this away from them and are firing people just to create an atmosphere of fear. But it's been that way forever in tech companies: SWE make enormous amounts of money and can control their work + environment a lot. In the world where corporations function like torture dungeons and managers are running around looking for opportunities to satisfy their sadist urges, how would the boom cycles ever happen where employees get whatever they ask for and 5 years of work straight out of university can get you enough money to retire to a modest life without ever lifting another finger. Managers are all bipolar? Do they have meetings where they coordinate when to lure the people in and then all release their hate at once for maximum effect? That just doesn't make a lot of sense to me whereas the cyclic nature of the economy and the external stimulus through a) everyone being in their homes a lot more because of the pandemic, and b) money pouring in like crazy because of the central banks explains both the aggressive hiring (during hard upswings and cheap money) as well as the trimming (during downturns and less cheap money). If it's one company, sure, it may be because of some manager hating people. But pretty much all companies with the exception of Apple (so far, and who also only indirectly employs a lot of their people, so they don't fire them, they just terminate the contracts with their employers, who then fire them)? That would need coordination beyond "monkey see, monkey do".
- Jensson 4y ago