What sort of system exists for these monster layoffs that they can just (relatively) quickly patch the hole left by removing 11,000 people? I can't comprehend what that looks like logistically.
[deleted]
Microsoft to lay off 11k employees
261–270 of 481 posts
Re: Microsoft to lay off 11k employees
#262Earlier quoted context omitted.
> Mass layoffs give you the opportunity to quickly purge poor performers without as much paperwork. It's advantageous to have regular rolling layoffs because of this if you can justify them by economic conditions. I've heard people say this, but it seems contrary to how layoffs are run in practice: • entire teams or divisions are often laid off with no eye towards individual employees' tenure, experience or skills •…
I've never seen a cold and calculated layoff. It's always been exasperated irrational arm-waving risk mitigation. The "good" people aren't kept - instead it's the ones that can navigate the political waters. For every one competent executive there seems to be 3 deluded narcissistic idiots who will slash and burn people who are overqualified and under-utilized for the positions they've been incompetently assigned. Now…
Yup, most mass layoffs are done without consulting the directly/skip managers who actually know who the strong performers are.
Re: Microsoft to lay off 11k employees
#263Every Big Tech collects bad hires and these are the best times to get rid of them.
It depends on how layoffs function. "Hey, every line manager chooses their least productive report and fires them" is one approach, but the situation often doesn't seem to get pushed down that far. Directors axe entire teams not necessarily through some analysis of productivity.
Re: Microsoft to lay off 11k employees
#264Earlier quoted context omitted.
Normally, hiring 11,000 people you "didn't need" would be a warning sign that management was incompetent and require much more than just laying off the unneeded workers. It would suggest that large reforms are needed in planning and hiring. But these days it's just dismissed as an "oops!".
no hiring process hits 100%. a healthy company deals with that reality incrementally. since many companies have adopted a policy of just generally not firing anyone for performance reasons, they just accrete these people, and when the opportunity arises (i.e. merger), they vent them en masse. I guess its easier to deal with the emotional/morale issues? probably legal too.
> many companies have adopted a policy of just generally not firing anyone for performance reasons
Not sure if that's true. For example, out of FANNG afaik only G would be least likely to fire ppl, they gave very generous chance to employees to improve and would only do 'piping' as the last option. But all the others have various forms of stack ranking and aggressive piping mechanism.
I would assume many other companies do the same
Re: Microsoft to lay off 11k employees
#265Earlier quoted context omitted.
Yes, Elon who made Tesla and SpaceX some of the largest companies in the world in just a few years, and likely many more over the next two decades is a totally incompetent buffoon. I’d rather take his side than the small minded and intellectually weak detractors. Just because things tend to be a certain way, doesn’t make it optimal or right. Evidence, all of history where bad practices were pervasive and common and l…
If Elon is mismanaging Twitter your post would be a good example of the cognitive bias called the Halo effect: https://en.wikipedia.org/wiki/Halo_effect
To say that somebody’s success at tasks that are highly correlated with a separate task is irrelevant is simply wrong.
And people who tend to succeed at most things they do, tend to do so for a reason. It’s effectively statistically impossible for it to be sheer coincidence/luck.
Or should I just pick random “logical fallacy” links to put in my replies instead?
Re: Microsoft to lay off 11k employees
#266Earlier quoted context omitted.
Why would they spend any amount much less $3b or $10b to keep people they don’t need/want?
Normally, hiring 11,000 people you "didn't need" would be a warning sign that management was incompetent and require much more than just laying off the unneeded workers. It would suggest that large reforms are needed in planning and hiring. But these days it's just dismissed as an "oops!".
[deleted]
Re: Microsoft to lay off 11k employees
#267Just last week MSFT nixed the accrual PTO benefit employees enjoyed and opted for the rouse of 'unlimited' PTO. Effectively, ending a liability/cash outlay they would pay when folks quit, or get fired. I hope those who were affected today receive severance that makes up for them losing this benefit. -James
[deleted]
Re: Microsoft to lay off 11k employees
#268Earlier quoted context omitted.
It's silly to mention the cash on the balance sheet without also mentioning the debt of $77B. In reality, the net cash position is on the order of magnitude of $30B which puts a much tighter perspective on the impact of this cut. 40% of all public companies created since market inception in 1871 have gone bankrupt including many of the bluest of the blue chips. Complacent thinking like this is often the reason. Addit…
That's fantastic debt though, at presumably low interest rates. A dollar in my pocket today is worth way more than a dollar in debt at 3.0% interest or less. You can't subtract debt from cash on hand and get a usable value, they're different types.
Could you clarify what you mean about the dollar in your pocket worth more than debt at 3% interest?
In corporate finance net cash or net debt is indeed standard practice (cash on balance sheet less debt on balance sheet). It sort of helps understand how much cash is ‘available’ to give back to investors, or pay down debt, spend on R&D, etc.
Now since most of MSFT’s long term debt matures in 2027 or after, you could argue that there is not much cash need for debt repayments in the near term. On the other hand, cash flow from operations was down year over year in their last reported quarter so belt tightening is probably needed to reverse that trend.
Re: Microsoft to lay off 11k employees
#269Just some initial Googling shows they had roughly 144K employees in 2019 and ~221K in 2022. If you take out 11k, they still added 66K jobs in 3 years. I'd be curious to know the breakdown of the kinds of jobs they added vs the ones they're now eliminating. The article says this cut affects mostly HR and engineering, but doesn't give exact numbers, and it is hard to tell the breakdown for jobs added (unless someone smarter than me can find the info in the public filings).
Re: Microsoft to lay off 11k employees
#270Earlier quoted context omitted.
Normally, hiring 11,000 people you "didn't need" would be a warning sign that management was incompetent and require much more than just laying off the unneeded workers. It would suggest that large reforms are needed in planning and hiring. But these days it's just dismissed as an "oops!".
Or, it means that they didn't forsee the economy going down to the extent it has. Corporate finances work like any large investment company. How much cash do you have on hand, how much is it earning per year, what is your revenue. If you suddenly are getting 10% less from investments and possibly less from revenue due to a severe economic downturn, then you need to save 10% in costs somewhere, and for tech companies…
There's no recession, though. There may be one this year, but it didn't exist before all of these layoffs. It may not be a conspiracy, but it seems questionable to believe these companies are not willing a recession into existence through, charitably, pessimism.