“Reduce the ‘headcount’ but profits must not decrease by one single penny.”
Said no one who understands how businesses work, ever. If capitalism actually worked the way these people claimed it worked, we wouldn’t have so many idiot billionaires.
Every time some boneheaded CEO follows the whims of these billionaire types, the press should start running articles as though the company’s days are numbered.
“More sudden layoffs! Is Google worried about its own long term prospects?” … “Google’s stance has changed from cutting edge innovation and growth to shoring up its flagship products in the hopes it can weather the storm. Battening down the hatches is the order of the day, and anything not deemed ship shape is left to flounder until it sinks.” Cite that most companies only cut staff like that when they’re looking to artificially inflate their valuation for some reason. Question if the impact of any recent bad moves are worse than expected.
The press should circle layoff-prone companies like sharks until they stop listening to stupid advice.
Make them stop and THINK about what they’re doing first. Teach the people in charge how to recognize when they’re being manipulated.
We give CEO’s entirely too much leeway to do incredibly dumb shit.
Carly Fiorina, John Roth, Frank Dunn, Mike Zafirovski, I don’t know if John Riccitiello is it at fault for the unity debacle, but he should have been able to stop it, John Wendell Thompson, Bob Allen, Kenneth Lay, John Sculley, Stephen Elop (How the fuck do you destroy NOKIA?!?!), Martin Shkreli, Carol Bartz, Leo Apotheker, the list is ENDLESS.
C levels have too much power to make RADICAL decisions and the fact that boards of directors are broken-record-skipping on the words “short term profit” is what keeps causing it to happen.
The billionaires and other CEO’s are on Ron Vachris’ ass every time there’s a group call because he keeps making them look bad, but he’s proven that his way is SUSTAINABLE.
It’s time to nudge things back into healthier directions.
A sign of morons and psychopaths being in charge of the world’s largest companies is that they have access to more talent and manpower than they can even use. Expanding operations would be a clear solution, even if no longer at economy of scale they will produce more revenue in diminishing percentages. It’s like being both Rome and the Barbarians.
Remember when a rich asshole got an itch to see the president of a university fired and just crawled up her ass until it happened? Sundar knows what someone with resources and a grudge can do to your career.
We don’t begrudge you your rectal fixation but if you could please avoid using the words “asshole” and “itch” in the same sentence that’d be appreciated. Apt though the comparison may be.
I think anybody with their finger on the pulse of the tech world could have seen this coming and it’s a natural consequence of a decade of incredibly low interest rates vastly inflating the sizes and valuations of these companies past where they naturally should be
That is to say, any random person can tell the CEO of Google to cut back their headcount, but that doesn’t mean that’s why they did it
I have appreciated our recent dialogue concerning Alphabet’s cost base. I am encouraged to see that you are now taking some action to right size Alphabet’s cost base and understand that it is never an easy decision to let people go.
I argued in my previous letter that Alphabet’s headcount has grown beyond what is required operationally. Over the last 5 years, Alphabet more than doubled its headcount, adding over 100,000 employees, of which over 30,000 were added in the first 9 months of 2022 alone. The decision to cut 12,000 jobs is a step in the right direction, but it does not even reverse the very strong headcount growth of 2022. Ultimately management will need to go further.
I believe that management should aim to reduce headcount to around 150,000, which is in line with Alphabet’s headcount at the end of 2021. This would require a total headcount reduction in the order of 20%.
Importantly, management should also take the opportunity to address excessive employee compensation. The median salary at Alphabet in 2021 amounted to nearly $300,000, and the average salary is much higher. Competition for talent in the technology industry has fallen significantly allowing Alphabet to materially reduce compensation per employee. In particular, Alphabet should limit stock-based compensation given the depressed share price.
I hope to have further dialogue with you on these matters in due course.
Some people transcribe posts on the internet as a matter of public service.
A picture of text is not particularly accessible to the blind. But written text, well they can zoom that significantly without reducing clarity, if they have some vision…or they can use any text-to-speech tool.
I don’t know a lot of poorly sighted people though. I’m assuming that they have some sort of font packages they use that scale well to large sizes for increased legibility, just like there are fonts specifically to help with dyslexia.
All fonts scale well since they are vector, so a blind person would not need a specialized font. If you want to learn about how some blind people use computers here is a video about one persons workflow.
I think asking for lowered compensation is definitely shitty and he should be condemned for that.
However, can someone explain to me the vitriolic opposition to downsizing/layoffs whenever this topic comes up?
I don’t see how anyone has a right be hired and work at X company. It is, after all, their company and their decision. Surely we can all agree that sometimes companies make strategic mistakes in terms of hiring and need to correct them later on. Also, circumstances could simply change, products be canceled or no longer need as much manpower etc.
I imagine it is because many of us have had it happened. We worked hard and did what we are supposed to do and now have to suffer because of another person’s mistake. A mistake that they are shielded from. It isn’t like the upper management is going to get fired because they overhired.
Additionally it tends to come in waves and that seems to be more based on what they think they can get away with not based on what the market is actually doing. One of my main vendors just did that to their engineering department. They are publically traded and their financials are fine.
I’m not against it in it’s entirety partly because of the point you made, it is their company after all.
What I am against is the intent behind cutting employees.
First, it’s just irresponsible to grow a company outside of what it can sustain. But in the end, the company survives and profits while the employee is now unemployed. The worker suffers because the top fucked up.
Second, corporate greed. It’s fucking up people’s lives for profit it technically doesn’t need to continue to exist and be successful.
It’s a human sacrifice to an entity that doesn’t even exist.
A company can hire you and give you a temporary contract, usually a year, but it can de shorter. After that they can do that again and again. But after 3 temporary contracts (at most 3 years) they have to give you a permanent contract.
The advantage of this permanent contract is that you can quit, but if you don’t and the company wants to fire you they have to compensate it financially. This usually is part of the contract you signed, but it’s 1-3 months of salary per year you worked for this company.
So of you get fired after 5 full years, you will get somewhere between 5 to 15 months of salary when you go.
So companies don’t fire you without really having a good reason and even if you are fired, you have extra money while searching for a new job.
One of my friends has been at the same company for a long time and he told me it would cost them 150K to fire him.
In millions 2021 revenue: 75,325 2022 revenue: 76,048
Revenue is neither stagnant nor decreasing. Only reason to reduce pay and headcount is to increase profit at the employee’s cost. All corporations will get to an operational standpoint that reducing costs through better process and materials is no longer feasible and the only avenue to increased profits is to begin extracting wealth from the employee’s via layoffs and salary reduction.
It’s also a fairly reliable indicator that the glory days of the business are over, and they’re pivoting from innovation to capture / create new markets and products to a conservative stance protecting their dominant position at the expense of everyone else - customers, staff, suppliers, vendors…
It’s possible to run lean and innovate, but at this phase of the business lifecycle, they’re not retooling to remove redundant management and organisational bloat - they’re cutting the “doers” responsible for building the product because they know they’re now in a position to sell the same old BS and just crush new market entrants that would drive continued improvement.
My disgust with it is that it’s simply a call to reduce labor not that there should be less people working on x or we should stop working on y. He views that this many people can’t be productive simply because he wants the company spending less on staff so his profits or share price goes up. It’s short sighted but since investors only care about the next quarter it doesn’t really matter to him.
I read his wikipedia article and I must say I was somewhat confused. He does not eat meat, he advocates urgent action on the climate crisis and has given over billions to children’s investment f (don’t know if this is a good charity or not). And yet he is an asshole enough to ask a company to fire tens of thousands of employees so his investments are more profitable on short term. It is entirely possible that he does not eat meat because he thinks that it is healthier and would make him live longer (typical billionaire). Moreover he was directly affiliated to the mentioned children’s charity through his wife so god knows what is really going on in there. Also after their divorce his fund is no longer contractually tied to the foundation so don’t know if he is regularly donating some parts of his profit there anymore.
he thinks that it is healthier and would make him live longer (typical billionaire)
I’m pretty sure there are a lot of people who aren’t billionaires who do this. I’m not sure “wanting to live longer” is necessarily a billionaire exclusive trait
Yea for sure but I think you miss my point. I am wondering whether if he is a vegetarian because he cares about the environment and animals or just because he thinks it is healthier.
The Children’s Investment Fund Management (TCI) is not a charity, it is a hedgefund. Even this letter was sent on behalf of TCI. They’re apparently one of the most activist investors out there. And not activism in a good way, their only focus is maximizing profits. So activism means: demanding lay-offs, doing unsolicited take-overs of other companies, etc. And then after a few years dumping the company again. They themselves probably have all sorts of thoughts about how they play an important function in an economy because they are ruthless and force changes in the markets. To put ‘children’s’ in the name is just a scam that aims to make them sound innocent. But just this fact tells you a lot about how these people operate. Source: en.wikipedia.org/…/The_Children's_Investment_Fund…
He does not eat meat, he advocates urgent action on the climate crisis and has given over billions to children’s investment f (don’t know if this is a good charity or not).
None of these make you a good person. You can do all these things, believe in them, and still be a bad person.
Could be, I would still be interested to know however why an emotionless asshole would be doing these. Does he still feel the need to repent or want to feel morally superior to your average asshole rich person? Or does he just use them as a facade to prevent being blamed as %100 narcissistic sociopath? Or maybe humans are complicated enough that they can spiritually melt firing tens of thousands of people for profit and climate/environment activism in the same pot and don’t feel contradicted about it.
I don’t think it’s that deep, personally. I truly believe someone can analyze their behavior, like eating meat for example, and have moral or health-related objections. This in no way means they aren’t a rich asshole billionaire. At the end of the day, he’s watching his bottom dollar as an investor. I’m sure everything comes second to that for him.
I just got laid off last month and I was a revenue generator.
The decision came down from the board as a part of a total restructure that eliminated my position, which was transitioning to be in line with the ‘new’ direction. The day after I was laid off I had an 80k deal come through, and I was set to bring in double what it cost to keep me on in 2024. That revenue would have continued to grow, and now they have no one to pick up that work and carry it forward. It was a stupid decision and I let them know how I felt about it (respectfully, didn’t want to burn any bridges) in my exit interview and when I attempted to negotiate my severance.
With piss and vinegar and a sincere belief that you deserve better, but with the clear understanding that you’ll likely get nothing.
So set your sights on something realistic and smaller.
I got them to sell me my work laptop for well below its depreciated value (14” M1 MacBook Pro kitted out with memory and storage for $800) which is what I went in hoping for. I had some real strong arguments for more severance which were all expectedly shot down, so when I asked for a discount on the laptop, I got it and I won.
In my case I knew the worst that would happen is they say no. That’s not gonna be true everywhere so there can definitely be some risk of losing the severance all together by asking for more, but if you have a good relationship with management and know they’ll come to the table in good faith it’s worth the time. If nothing else you come to the table and let them know you understand what the severance is all about (the non disparagement clause is all they really care about) and sometimes that’s enough to get them to give you something more.
