Friday, March 27, 2009


The news this week was that IBM laid off 5000 workers in the US. Some take-aways for me:
  • No matter how strong you are, you can't be stronger than your customers. IBM looked at the numbers and said we need to be leaner in the coming year. Anyone watching the news could have seen that coming.
  • When you work for a good company, good people get laid off. Why? Because there aren't any bad people to lay off. Those of us who kept our jobs need to reflect on that with a bit of humility.
  • In a bad economy, avoid specialist roles like "special adviser" or "ombudsman." If you're out there all alone on an org chart, well, it's as good as wearing a target. Avoid being an infrastructure person; try to be writing words someone is ultimately paying for (i.e., user-facing doc).
I got some insight from our director about how this sort of thing works. I'd seen it from the inside before, but his clarity gave me fresh insight.

It starts at high-level management as a dollar amount. "Our income and our burn rate are misaligned by this much, therefore we need to cut x dollars." Payroll is the deepest pocket, so that's where you have to go if x is a big number. Then middle managers do some calculations and x dollars is translated into y headcount. From then on, y becomes "the number." Lower level managers divvy up y among even lower level managers until some sub-component of y is communicated to a line manager who must convert that number into names, that is, actual people who have to figure out how to make mortgages and buy food.

It's a cold calculus and a heartbreaking one that gets more so as the process trickles lower and lower. It probably works because the ones at the top who have to start the ball rolling are insulated from the humanity where the ball lands.

So if you lose your job, take some solace in the coldness; it was never about you and it wasn't because of anything you did. If you keep your job, it doesn't mean you are better than those who didn't, just luckier, perhaps.

May we all be lucky.

1 comment:

Ivan Walsh said...


..just luckier, perhaps.

Not so sure, tbh. I think it's more that high value jobs that are hard to transition, such as established business roles that have been established with local companies, are hard to outsource.

But coding and back office can be performed remotely from any location.

I've move to China recently and have to say that the level of development is truly astonishing.

IBM is here of course and have just landed a USD 1.5 billion contract to revamp the Chinese health system.

I would strongly suggest to any motivated men/women out there to consider learning mandarin and living here for a few years.