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Zenefits confirms 250 layoffs, 17% of company workforce

venturebeat.com

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Re: Zenefits confirms 250 layoffs, 17% of company workforce

#21

Post by trjordan »

kylestlb wrote: post #8

Layoffs are never fun... sad :( For the more biz-minded commenters out there: does laying off sales + recruiting signal a specific scenario (other than the obvious recent legal woes)? Rather than laying off engineers?

Zenefits is a classic enterprise sale, meaning you staff the sales team at: # of reps X average quota = expected sales.

The recent problems will hit their sales hard, and leadership knows it. With the growth they've had, there's a chunk of their sales team that's not fully ramped (meaning not producing revenue). Laying off reps + recruiting says they think they can't grow as fast as they previously could.

Not laying off engineers is probably more about how hard it is to hire engineers today, and knowing that when they get past these problems, it'll be easier to re-hire reps than re-hire engineers.

Re: Zenefits confirms 250 layoffs, 17% of company workforce

#22

Post by jsprogrammer »

braythwayt wrote: post #10

> Human resources and insurance software startup Zenefits > has announced that 250 employees are being made redundant, > representing 17 percent of the company’s workforce. Before "being made redundant' became empty buzzspeak, it had a very specific meaning: When things are restructured in such a way that two people end up doing the same job, one becomes redundant. For example, if you have an in-house recruiting team…

It doesn't appear (from this article, at least) that the company ever used that word. As far as I can tell it is an editorialization by author of the article.

Re: Zenefits confirms 250 layoffs, 17% of company workforce

#23

Post by asadlionpk »

eldavido wrote: post #20

It irritates me that engineers never get laid off. This means companies still view their engineering workforces as "scarce" and hard to get, because they aren't paying market wages. Why is it only sales that gets the ax?

Here is what may be the reasons: - Because sales team is more easily replaceable than core engineering team. - There is less any redundancy in engineering team when compared to sales. - Zenefits is reducing their sales operation.

Re: Zenefits confirms 250 layoffs, 17% of company workforce

#24

Post by jsprogrammer »

eldavido wrote: post #20

It irritates me that engineers never get laid off. This means companies still view their engineering workforces as "scarce" and hard to get, because they aren't paying market wages. Why is it only sales that gets the ax?

Sales has probably gone through the pipeline of customers and engineering is probably still working on building out everything that was promised to customers?

Re: Zenefits confirms 250 layoffs, 17% of company workforce

#25

Post by tallanvor »

timrpeterson wrote: post #6

How does a company, especially a nascent one like Zeenfits, survive in a space when they've suffered this type of hit? An industry all about trust and conservatism and a company playing fast and loose with the rules? Can it work out?

They could survive. My guess is they'll basically focus on retaining as many current customers as possible, get through any investigations about their practices, and hope that once those are finished people will mostly have forgotten about what happened and be willing to give them a chance if their product is on par with others out there.

Re: Zenefits confirms 250 layoffs, 17% of company workforce

#26

Post by w1ntermute »

trjordan wrote: post #21
kylestlb wrote: post #8

Layoffs are never fun... sad :( For the more biz-minded commenters out there: does laying off sales + recruiting signal a specific scenario (other than the obvious recent legal woes)? Rather than laying off engineers?

Zenefits is a classic enterprise sale, meaning you staff the sales team at: # of reps X average quota = expected sales. The recent problems will hit their sales hard, and leadership knows it. With the growth they've had, there's a chunk of their sales team that's not fully ramped (meaning not producing revenue). Laying off reps + recruiting says they think they can't grow as fast as they previously could. Not laying…

Why exactly is it so hard to hire engineers as opposed to sales people? Isn't it just as hard to find a 10x sales person as a 10x engineer?

Re: Zenefits confirms 250 layoffs, 17% of company workforce

#27

Post by mcphilip »

dragonwriter wrote: post #14
braythwayt wrote: post #10

> Human resources and insurance software startup Zenefits > has announced that 250 employees are being made redundant, > representing 17 percent of the company’s workforce. Before "being made redundant' became empty buzzspeak, it had a very specific meaning: When things are restructured in such a way that two people end up doing the same job, one becomes redundant. For example, if you have an in-house recruiting team…

I think "made redundant" has been the British term for laid off for quite a while; though this is, IME, far less common in American usage. I think the distinction you are positing between them could be a good one to make, but I don't think its one that has ever been consistently applied in general usage of the terms in reference to business. > In this case, the company is laying off a lot of its sales force and recru…

>I think "made redundant" has been the British term for laid off for quite a while; though this is, IME, far less common in American usage.

A big part of the plot in the British Office tv show was watching Ricky Gervais fumble his department through a merger that ultimately made him redundant. He kept assuring the employees there would be no redundancies.

Zenefits using the term redundancies may just be colloquial British phrasing. They've got much greater PR problems now that make the semantics of layoffs vs redundancies seem a minor concern.

Re: Zenefits confirms 250 layoffs, 17% of company workforce

#28

Post by Retric »

braythwayt wrote: post #15
Retric wrote: post #12

Earlier quoted context omitted.

Not necessarily. If MS decides to build Windows 12 from the ground up they may have a separate team work on Windows 11. After that project is done most of the Windows 11 team would be redundant. Edit: They even did something like this with NT 4.0, ME, and XP. Similarly, if a catalog transitions to a website once that's done the legacy catalog team could simply be redundant.

"Redundant" is not a pure synonym for "unnecessary" or "obsolete," and in business-speak it used to have the meaning I shared above. It used to arise a lot in mergers, where "efficiencies" arose by consolidating functions and making entire departments "redundant." If buggy-whips were to disappear as a business because Buggy 2.0 (a/k/a the automobile) comes along, it was not commonplace to say that buggy -whip manufac…

What I think your missing industry leaders often can't grow market share. In that situation R&D is often focused on lowering costs which in some industry's directly translate to people. In this case the skill set is still valuable, you just need fewer people.

EX: ATM's did not remove the need for all bank tellers, but they removed the need for huge numbers of them.

Re: Zenefits confirms 250 layoffs, 17% of company workforce

#29

Post by dragonwriter »

eldavido wrote: post #20

It irritates me that engineers never get laid off. This means companies still view their engineering workforces as "scarce" and hard to get, because they aren't paying market wages. Why is it only sales that gets the ax?

The license requirement cheating (in one jurisdiction) and outright selling without a license (in other jurisdictions) were problems occurring in Sales (which may implicate some problems in Recruiting, as well.)

I don't recall any of their problems being traced to engineering. So, while these are for PR purposes styled as redundancies, I think its at least worth considering that it may be more of a purge of the problem parts of the company.

Re: Zenefits confirms 250 layoffs, 17% of company workforce

#30

Post by aliston »

eldavido wrote: post #20

It irritates me that engineers never get laid off. This means companies still view their engineering workforces as "scarce" and hard to get, because they aren't paying market wages. Why is it only sales that gets the ax?

I can't tell if this is sarcastic or not, but there have been lots of engineering layoffs as well. Twitter and Yahoo, for example.
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