4 ms·

Cisco slashes thousands of workers as it announces yearly profit of $10.3B

72 points by CharlesW 2y ago

dylan604 2y ago
Company: We just made $10.3B in profits Stockholders: How do we make it $11.3B in profits? Company: Layoffs!!
- lionkor 2y ago
  Or War, either works
  - snihalani 2y ago
    how will war help cisco?
    - stemlord 2y ago
      Dieoffs instead of layoffs I presume
    - Lammy 2y ago
      https://www.defense.gov/News/Contracts/Contract/Article/1878725/ https://www.defense.gov/News/Contracts/Contract/Article/1878..., https://www.defense.gov/News/Contracts/Contract/Article/2657500/ https://www.defense.gov/News/Contracts/Contract/Article/2657..., etc
  - oysterville 2y ago
    Civilian casualty either way.
realce 2y ago
> Cisco spokesperson Robyn Blum said in an email to SFGATE that the layoff is meant to allow the company to invest in “key growth opportunities and drive more efficiency in our business.” Human Labor is no longer a "key growth opportunity" it's looking like?
- Nifty3929 2y ago
  Human labor is a cost to society. The less of it we use per unit of output, the better off we all are. If Cisco can generate their value to society with fewer people that's a good thing. Society gains the additional output those workers will generate in other places. Sucks to be one of those laid off though.
  - unethical_ban 2y ago
    UBI first, then the AI workforce apocalypse, please.
  - pizza 2y ago
    I think this assumes a lot of efficiency and rapid equilibration in the reallocation of labor. There are real costs and inefficiencies in the job search process and constraints limiting which new jobs these now-displaced workers can actually end up at, and I don't think you can just treat a worker as a value-making widget that pumps out as much value in one job as another. I'd also add it's not clear to me that labor reduction must lead to better productivity - can't you have a situation where labor reduction (and or wage suppression) actually reduce downstream demand / productivity?
    - Nifty3929 2y ago
      Labor reduction - given constant output - is the definition of better productivity.
  - MattPalmer1086 2y ago
    But in the limit, where most output could be automated, then there would be no society worth having. Without some fundamental redistribution of how wealth is allocated, anyway.
    - Nifty3929 2y ago
      Really? - that sounds like utopia to me. We don't have to work at things that we don't want to. We can go rock climbing or play music or whatever. And the machines to all the work. We could still make a table or write a program if we want to - for it's own sake. Yes, of course we have to handle the distribution of the stuff, but that's really a separate problem.
Alupis 2y ago
The framing of the title is ridiculous. > Cisco slashes thousands of workers as it announces yearly profit of $10.3B What does profit have to do with lay offs? Cisco has no obligation to continue employing workers it does not have a need for, and/or projects no need for in the near future. What is this, the federal government??? Ya, it sucks being laid off. But that's part of the "game" of being an employee. You're paid to do a certain job, and if that job doesn't need to be done anymore, well, you're out of a job. Cisco had 84,000 employees before layoffs, and will still have more than 70,000 after this round is complete. That's still a massive payroll...
- bufferoverflow 2y ago
  Not sure why you're downvoted. Everything you wrote is factually correct. Some people seem to be employment-entitled. I got laid off a few times, it's not a big deal. It just business doesn't want my skills at the price they are paying.
  - neilv 2y ago
    > I got laid off a few times, it's not a big deal. It's a big deal for a lot of people. And someday it may be a big deal for you. > It just business doesn't want my skills at the price they are paying. If you expand this theory of economics, why shouldn't the market of labor punish an employer for undesirable properties as an employer?
    - Alupis 2y ago
      What was the undesirable behavior? Employing ~10,000 people that Cisco didn't need to employ and pay relatively high wages to? Or for cutting employees Cisco no longer has a need for? Should Cisco be forced to carry dead weight until it's no longer profitable, only then being allowed to cut employees? How does that serve the other ~70,000+ that are still employed at Cisco and would likely prefer to see Cisco smartly allocate it's resources? Should we craft a system in-which companies are afraid to hire because they'll be forced to keep those employees on payroll forever? How does that foster a healthy environment that produces competitive products and services? People complain about "leetcode" exercises and hiring processes as it is... can you imagine what companies would put applicants through if hiring was a lifetime commitment? For-profit companies are not charities. You are not entitled to a job at one of these companies. Yes, it does suck being laid off, but it's not the end of the world. If you were smart and talented enough to find employment at Cisco for however many years, you're smart and talented enough to find employment elsewhere too.
browningstreet 2y ago
> Cisco spokesperson Robyn Blum said in an email to SFGATE that the layoff is meant to allow the company to invest in “key growth opportunities and drive more efficiency in our business.” Cutting costs through layoffs and then plowing cash into expensive technologies like artificial intelligence is a trend that’s emerged at some tech companies over the past two years. So they want to put their money into hardware and compute, not talent? Their layoffs in the last year will be nearly 10% of total headcount. AI doesn't have enough runway at this point to have a lot of seasoned people available in the marketplace. Re-training tech workers has to be a cost effective alternative to lay-offs and severance packages, etc. Can anyone besides Wall Street generate a narrative that incurs a "try harder" penalty against companies who go this route? I'm interviewing right now with FAANG level companies. The process is so slow (5-8 interviews over 3-4 months) and burdensome (even on the company side of things), at some point retaining people who made it through this process would seem to be a reasonable T&E objective. Companies are also generally terrible at on-boarding and training -- tenure is usually a good value to have in an employee (they know the company, products, culture, teams, processes, etc). (Yes, I know.. they may want to lay-off those they deem poor performers..)
- spacemadness 2y ago
  I think you’ll be sorely disappointed in looking for reason, if reason means long-term strategically sound decisions, from any of these publicly traded companies. The incentives are almost always short-term. Executives are normally completely disconnected with how the company really functions. The power structures separate the decision makers from reality since most are too afraid for their own careers to question the leadership. Slash and burn tactics win over internal training. Almost all managers I’ve seen in these companies bend over backwards to implement whatever is being decided without questioning anything, even if they have better data on hand to prove the decisions are poorly thought out. That also goes for directors. If you understand this going in you won’t necessarily have an existential crisis, but if you don’t you’re in for a bad time. One of the ex-CEOs of Medtronic use to sit with the engineers during lunch to understand what was really going on in the company as he found his underlings continually hid problems from him. I wish more CEOs understood the wisdom of that but they’re too busy playing as feudal lords.
deleted 2y ago
[deleted]
oldpersonintx 2y ago
[dead]
ericmcer 2y ago
Man corporations have really used AI to justify shredding their workforce. Something needs to happen to protect workers at some point. MBAs are going to keep doing everything they can to optimize earnings, and firing 5k is a great way to instantly boost earnings. Everything is just optimized around raising the stock price. Our whole economy is like a shitty team where some manager has decided everything must revolve around a dumb goal that doesn’t actually serve users.
- readthenotes1 2y ago
  Protect the workers? Why would you want to go back to serfdom?
- Alupis 2y ago
  > Man corporations have really used AI to justify shredding their workforce. Most of these layoffs are the balancing force for massive headcount increases during covid. Headcount that isn't necessary outside of that unusual time. Current economy isn't amazing, and companies are preparing for slower times.
- s1artibartfast 2y ago
  The best worker protection is providing a valuable service. Who would want deadweight employees that are a drag on earnings? You are mistaken if you think the point of a company is to serve users unless it is user owned.
  - ericmcer 2y ago
    So tech lets one person do the work of many, what is your endgame here as more and more people become “deadweight”? I don’t totally disagree with you but if our stance towards workers is “figure out how to create value or get left behind” we are in for an ugly future.
    - s1artibartfast 2y ago
      >I don’t totally disagree with you but if our stance towards workers is “figure out how to create value or get left behind” we are in for an ugly future. I dont think that is a current or near term problem. Unemployment is low and there is a still a huge demand for human labor. I just got a quote of 60k for someone to landscape my residential back yard. I spoke with several trades people from drywall to catering to photography that charge $250-500 per hour. "Figure out out to create value" has always been true and it is essential not to forget this. I think the idea that people dont need to provide value is far more scary and dangerous for the future. Yes, we can also be thoughtful about if we can help people transition jobs and skills as a society, but that I dont think there is anything special about the current moment.
samdunham 2y ago
Staffing isn't necessarily directly tied to profits. Just because a company is financially successful, does not automatically mean that it isn't overstaffed. I'm not saying that's the case here, specifically, just as a general rule.
kajdhG 2y ago
[flagged]
neilv 2y ago
Remember this. This presumably tells you a lot about their corporate culture, so, what it would be like to work there.
josefritzishere 2y ago
Every time we go through a cycle of automation, and layoffs, and out-sourcing I have to wonder where the bottom is. There is a wide gradient on how that might play out in terns of our standard of living. Will the bottom be more like Bulgaria? Or will the bottom be more like Sudan?

72 points by CharlesW 2y ago

dylan604 2y ago

Company: We just made $10.3B in profits Stockholders: How do we make it $11.3B in profits? Company: Layoffs!!

lionkor 2y ago
Or War, either works
- snihalani 2y ago
  how will war help cisco?
  - stemlord 2y ago
    Dieoffs instead of layoffs I presume
  - Lammy 2y ago
    https://www.defense.gov/News/Contracts/Contract/Article/1878725/ https://www.defense.gov/News/Contracts/Contract/Article/1878..., https://www.defense.gov/News/Contracts/Contract/Article/2657500/ https://www.defense.gov/News/Contracts/Contract/Article/2657..., etc
- oysterville 2y ago
  Civilian casualty either way.

realce 2y ago

Nifty3929 2y ago
Human labor is a cost to society. The less of it we use per unit of output, the better off we all are. If Cisco can generate their value to society with fewer people that's a good thing. Society gains the additional output those workers will generate in other places. Sucks to be one of those laid off though.
- unethical_ban 2y ago
  UBI first, then the AI workforce apocalypse, please.
- pizza 2y ago
  I think this assumes a lot of efficiency and rapid equilibration in the reallocation of labor. There are real costs and inefficiencies in the job search process and constraints limiting which new jobs these now-displaced workers can actually end up at, and I don't think you can just treat a worker as a value-making widget that pumps out as much value in one job as another. I'd also add it's not clear to me that labor reduction must lead to better productivity - can't you have a situation where labor reduction (and or wage suppression) actually reduce downstream demand / productivity?
  - Nifty3929 2y ago
    Labor reduction - given constant output - is the definition of better productivity.
- MattPalmer1086 2y ago
  But in the limit, where most output could be automated, then there would be no society worth having. Without some fundamental redistribution of how wealth is allocated, anyway.
  - Nifty3929 2y ago
    Really? - that sounds like utopia to me. We don't have to work at things that we don't want to. We can go rock climbing or play music or whatever. And the machines to all the work. We could still make a table or write a program if we want to - for it's own sake. Yes, of course we have to handle the distribution of the stuff, but that's really a separate problem.

Alupis 2y ago

The framing of the title is ridiculous. > Cisco slashes thousands of workers as it announces yearly profit of $10.3B What does profit have to do with lay offs? Cisco has no obligation to continue employing workers it does not have a need for, and/or projects no need for in the near future. What is this, the federal government??? Ya, it sucks being laid off. But that's part of the "game" of being an employee. You're paid to do a certain job, and if that job doesn't need to be done anymore, well, you're out of a job. Cisco had 84,000 employees before layoffs, and will still have more than 70,000 after this round is complete. That's still a massive payroll...

bufferoverflow 2y ago
Not sure why you're downvoted. Everything you wrote is factually correct. Some people seem to be employment-entitled. I got laid off a few times, it's not a big deal. It just business doesn't want my skills at the price they are paying.
- neilv 2y ago
  > I got laid off a few times, it's not a big deal. It's a big deal for a lot of people. And someday it may be a big deal for you. > It just business doesn't want my skills at the price they are paying. If you expand this theory of economics, why shouldn't the market of labor punish an employer for undesirable properties as an employer?
  - Alupis 2y ago
    What was the undesirable behavior? Employing ~10,000 people that Cisco didn't need to employ and pay relatively high wages to? Or for cutting employees Cisco no longer has a need for? Should Cisco be forced to carry dead weight until it's no longer profitable, only then being allowed to cut employees? How does that serve the other ~70,000+ that are still employed at Cisco and would likely prefer to see Cisco smartly allocate it's resources? Should we craft a system in-which companies are afraid to hire because they'll be forced to keep those employees on payroll forever? How does that foster a healthy environment that produces competitive products and services? People complain about "leetcode" exercises and hiring processes as it is... can you imagine what companies would put applicants through if hiring was a lifetime commitment? For-profit companies are not charities. You are not entitled to a job at one of these companies. Yes, it does suck being laid off, but it's not the end of the world. If you were smart and talented enough to find employment at Cisco for however many years, you're smart and talented enough to find employment elsewhere too.

browningstreet 2y ago

> Cisco spokesperson Robyn Blum said in an email to SFGATE that the layoff is meant to allow the company to invest in “key growth opportunities and drive more efficiency in our business.” Cutting costs through layoffs and then plowing cash into expensive technologies like artificial intelligence is a trend that’s emerged at some tech companies over the past two years. So they want to put their money into hardware and compute, not talent? Their layoffs in the last year will be nearly 10% of total headcount. AI doesn't have enough runway at this point to have a lot of seasoned people available in the marketplace. Re-training tech workers has to be a cost effective alternative to lay-offs and severance packages, etc. Can anyone besides Wall Street generate a narrative that incurs a "try harder" penalty against companies who go this route? I'm interviewing right now with FAANG level companies. The process is so slow (5-8 interviews over 3-4 months) and burdensome (even on the company side of things), at some point retaining people who made it through this process would seem to be a reasonable T&E objective. Companies are also generally terrible at on-boarding and training -- tenure is usually a good value to have in an employee (they know the company, products, culture, teams, processes, etc). (Yes, I know.. they may want to lay-off those they deem poor performers..)

spacemadness 2y ago
I think you’ll be sorely disappointed in looking for reason, if reason means long-term strategically sound decisions, from any of these publicly traded companies. The incentives are almost always short-term. Executives are normally completely disconnected with how the company really functions. The power structures separate the decision makers from reality since most are too afraid for their own careers to question the leadership. Slash and burn tactics win over internal training. Almost all managers I’ve seen in these companies bend over backwards to implement whatever is being decided without questioning anything, even if they have better data on hand to prove the decisions are poorly thought out. That also goes for directors. If you understand this going in you won’t necessarily have an existential crisis, but if you don’t you’re in for a bad time. One of the ex-CEOs of Medtronic use to sit with the engineers during lunch to understand what was really going on in the company as he found his underlings continually hid problems from him. I wish more CEOs understood the wisdom of that but they’re too busy playing as feudal lords.

deleted 2y ago

[deleted]

oldpersonintx 2y ago

[dead]

ericmcer 2y ago

Man corporations have really used AI to justify shredding their workforce. Something needs to happen to protect workers at some point. MBAs are going to keep doing everything they can to optimize earnings, and firing 5k is a great way to instantly boost earnings. Everything is just optimized around raising the stock price. Our whole economy is like a shitty team where some manager has decided everything must revolve around a dumb goal that doesn’t actually serve users.

readthenotes1 2y ago
Protect the workers? Why would you want to go back to serfdom?
Alupis 2y ago
> Man corporations have really used AI to justify shredding their workforce. Most of these layoffs are the balancing force for massive headcount increases during covid. Headcount that isn't necessary outside of that unusual time. Current economy isn't amazing, and companies are preparing for slower times.
s1artibartfast 2y ago
The best worker protection is providing a valuable service. Who would want deadweight employees that are a drag on earnings? You are mistaken if you think the point of a company is to serve users unless it is user owned.
- ericmcer 2y ago
  So tech lets one person do the work of many, what is your endgame here as more and more people become “deadweight”? I don’t totally disagree with you but if our stance towards workers is “figure out how to create value or get left behind” we are in for an ugly future.
  - s1artibartfast 2y ago
    >I don’t totally disagree with you but if our stance towards workers is “figure out how to create value or get left behind” we are in for an ugly future. I dont think that is a current or near term problem. Unemployment is low and there is a still a huge demand for human labor. I just got a quote of 60k for someone to landscape my residential back yard. I spoke with several trades people from drywall to catering to photography that charge $250-500 per hour. "Figure out out to create value" has always been true and it is essential not to forget this. I think the idea that people dont need to provide value is far more scary and dangerous for the future. Yes, we can also be thoughtful about if we can help people transition jobs and skills as a society, but that I dont think there is anything special about the current moment.

samdunham 2y ago

Staffing isn't necessarily directly tied to profits. Just because a company is financially successful, does not automatically mean that it isn't overstaffed. I'm not saying that's the case here, specifically, just as a general rule.

kajdhG 2y ago

[flagged]

neilv 2y ago

Remember this. This presumably tells you a lot about their corporate culture, so, what it would be like to work there.

josefritzishere 2y ago

Every time we go through a cycle of automation, and layoffs, and out-sourcing I have to wonder where the bottom is. There is a wide gradient on how that might play out in terns of our standard of living. Will the bottom be more like Bulgaria? Or will the bottom be more like Sudan?