Layoffs are often about retrenching on verticals we think we can turn a profit on. If decreasing your overhead by 5% makes or breaks your company then you don’t have a viable business model.
You can have plenty of people who are very good at a skill you either don’t need or have an oversupply of bus numbers on. At least a third of the people in any group you shut down completely are going to have been good people. More than half if the problem was in management (which is usually is).
You’re dunking on these people and telling the rest of the universe not to hire them. But we already knew Google was shitty so this isn’t exactly news.
Going from default dead to default alive is huge. But a 3% profit margin just keeps you alive until some disaster occurs and then you’re still dead.
Going from 5% to 10% might be leverage in the market, but you were still going to limp along anyway. When I’ve been at startups trying to do things like this, it’s very clear that the investors have in their head some notion of multiplying your profits. Every company I worked for that pulled this ended up cutting to the bone later. I don’t think that’s a coincidence.
These days I’m not sure labor is a big enough part of the cost mix for a 10% layoff to actually show up as 5% margin. I pulled that out of my butt and now I’m having second thoughts.
You can have plenty of people who are very good at a skill you either don’t need or have an oversupply of bus numbers on. At least a third of the people in any group you shut down completely are going to have been good people. More than half if the problem was in management (which is usually is).
You’re dunking on these people and telling the rest of the universe not to hire them. But we already knew Google was shitty so this isn’t exactly news.