Just for reference, this post was inspired by the layoffs going on at Intel right now, but represents only my own opinions and musings. I posted something similar on my internal Intel blog. Lots of people are finding out about their status, and it’s something that’s on everyone’s mind. So let’s not ignore the elephant in the room.
What if companies did layoffs as a random lottery drawing? If your group (say, IT) has to get rid of 1000 people, then you enter all of their names into a pool, and draw out the 1000 unlucky people? This could be done in software, and in the spirit of fairness and transparency, the source code could be made available.
This way, the cuts are made, and you can move on, restructure your company, and adapt to the new reality of getting the work done without those people. But without six months of tense, paranoid waiting.
“But”, you might say, “that’s unfair! What about skills? What if someone critical gets picked in the lottery?” If there’s a person or job that really is so critical that they should be immune from all of this, they can be excluded from the lottery. But most companies tell employees that there are never any guarantees regarding employment. How is a lottery any less fair than, say, a long, drawn out restructuring effort? How much confidence do you have that a deliberate “skill-based” evaluation is really “fair”?
You could make it easier on the people that get picked in the lottery - give them a nice fat six month severance package or something. That would be cheaper than keeping them on the payroll for six months then giving them whatever smaller severance (that word is so morbid!) package they would otherwise get when they leave.
In summary, the benefits of doing layoffs as a random lottery are:
- Cut once, cut deep. Get it over with, and deal with the org changes and churn sooner rather than later, because they’re going to happen anyway
- Avoid the lost productivity and rock bottom morale that come with a long, drawn out process
- Save money - give fat severances sooner
- Increased transparency - everyone would know what was behind the decision making
- Politics and personal opinions are completely removed from the equation
What are the negatives of doing it this way? Besides the stuff I addressed above, I honestly can’t think of any. What do you think? Let’s start some discussion - leave a comment, or post something on your own blog about this.
Update: Some more discussion on the topic over at the Unofficial Intel Blog. Pentrino VI is upset that I beat him to the punch with this post. 
TinyScreenfuls Feed (this blog)
I like it.
If someone REALLY is that critical then after they are gone re-create the position and hire someone into it. You might get lucky and get someone better or more qualified. It also highly encourages cross training. No more job security because you are the only one who knows a process.
Michael
How is that really fair? It really seems to me that there are those that seem to think that it is also more cost effective to get rid of those that are close to the “rule of 75″ and put someone in cheaper and make them learn their job and hope that they can do it as well or with as much efficiency. I am fortunate that I am married a longterm Intel employee (not a manager) who is going to be coming into the “rule of 75″, which as a spouse, I really don’t know a lot about, I admit. But reading in another blog, he is not one to defend his turf to the detriment of anyone else. He is the person that you know that you can go to and ask anything and get a straightforward, honest answer. Yes on paper, I am sure that it would look equitable to do a lottery layoff, but it would also appear that when you clear the decks of all those that you have lost, what if you lost the best and brightest in some departments. Then you have to spend months to years to catch new employees up on what the now gone employees were doing. How productive is that? Just my outsider opinion.
That’s a very valid opinion - thanks for sharing it.
One thing that happens when things are drawn out for as long as they have been (six months), with everyone worried about their job, being less productive, and feeling the stress of not knowing, is that the really bright, talented, “best” people leave the company for somewhere else. And then you’re left with the people who were only worried about defending their job/justifying their existence.
This “brain drain” is a problem when layoffs happen over a long, agonizing period.
So how do you decide which is “best” - take your chances with a random lottery, or risk the effects of brain drain with a long, drawn out process?
Josh, I like your idea better. This process has been drawn out waaaayy too long, and it’s gotta be hurting the productivity of the company. Apparently there was an announcement of another VSP in Ireland yesterday (at least EU law protects the individual, you practically can’t be ‘walked’ off site) when most people thought that they were safe and had avoided the previous culls….
A quick process with a reasonable severance package would allow those affected to get on with their lives and those who stay to re-focus and get on with their jobs!
Another option would be a draft. All employees are in the pool and managers get to pick their teams. You could draw straws for which manager gets to pick first.
The reality is that there is no good way to fire people. It has such a deep impact on people - financial, emotional, relational, etc.
Mr. Pearson must be a manager, because his suggestion is spoken like a true manager. Who’s going to select the managers that stay and go? Or does he suggest that managers stay and it’s the individual contributors who are the dispensible ones?
So it comes down to selecting who we think is the strongest and plays harder like picking captains on the schoolground and making selections until little Joey is left behind that nobody wants to pick. Bye, bye Joey. Sorry but nobody thinks you’re good enough to stay.
Intel has focal results. If you want a system like that, just cut the bottom performers. Cut out the politics. But realize when you cut out the bottom 10 or 20 percent and fire them, you just created a new bottom 10 to 20 percent. The problem didn’t go away, just redistributed.
Layoffs suck because people did not perform up to their expected level, but it’s not those that get layed off. It’s the folks that have been performing as they have been asked, but unfortunately because someone (a manager) created a position that turned out to be not that important, they get canned.
I would not choose either. There is a third option, keep the people that are best for Intel, but do this quicker. I also think that based on the needs of Intel long term not short term. If your skill sets are not needed, Intel should quickly cut you loose so you can find another job where your skills are in demand. But again, I don’t work for the company so take it for what it is worth.
^^^ Ding Ding Ding! We have a winner!
I think we all wish that it were done that way. And we’ll never know the reasons it wasn’t…
Well Josh, let me throw a spanner in the works then:
You might get away with this approach in the US, but I expect you would run into problems with various labour laws in Europe (and potentially other geographies).
While I’m not a lawyer and far from an expert on labour law my understanding is that you need to prove you have followed a process based on business needs in a lot of countries here in Europe. If you lay off a person picked by a lottery only to replace him/her with someone else I believe that person could quite likely claim unfair dismissal. In other words you need to be able to prove that the position is redundant and/or that you’ve performed another process based on the skills/performance of the employees.
Your lottery probably wouldn’t fulfil the requirements of the law. And would you really want different process in different geographies?
Armin, There’s different processes in different geographies as it is…
When the 1000 managers were laid off, the ones in some US sites were walked off-site by security 2 mins after the e-mail went out, while in Ireland is was a VSP program.
The portion of my virtual team in the US knew that their jobs were safe (as safe as they can be) at the end of August, it was 3 weeks later before I knew…
Whether you believe that this is a good idea depends largely upon what your view point is. If I am in charge of maintaining Intel’s profitability and the desireability of its stock price, then it is far from clear to me that firing a random subset of people is a good idea. If the contributions of individuals lie along a Bell Curve, then clearly half the people that I fire will be contributing more than the average employee to the profitability of Intel. We’d be a better company if we could fire only those people below average. It avoids the long period of limbo (which my wife went through recently) which is certainly soul-sucking and makes for a crappy work environment, but you have to weigh it against the potential loss of employees that you’d rather keep and retaining employees that you’d be better off losing.
Somewhat more dangerously, it sends a message to current and potential employees: “We don’t know what the hell we are doing.” If Intel can’t identify those employees and projects which are making significant contributions to Intel’s profitability, if their strategy to return to profitability is merely to throw darts, hoping to remove *something* that is bad, then they are in deep, deep, doodoo.
Money did an article several years ago about corporate downsizing. They found that it was an enormously popular strategy, but that cutting the work force by 10% reduced overall expenses by a modest 3% (figures from memory, but I think they are accurate). It did, however, appear to be a good strategy for ensuring good bonuses for board members.
Armin, there are already different processes in different countries, as elly points out, and as you are all too aware of…
Mark, you make some really good points. They’re sad, if you’re an Intel employee right now, but they’re very relevant, and hit the bullseye of what a lot of people feel is the problem at Intel right now… Some people feel that the current “planned, targeted” reductions are no better than a random lottery, with the added detriment of the fact that it’s taken six months to get to this point, with the accompanying low morale and brain drain.
Intelwife makes a good point. This did take a long time. I too would like to see the best people stay.
Someone told me once that a recession is when your neighbor gets laid off and a depression is when you do. The point is that no matter how the people were chosen, no one feels good about it. The people who are being let go are smart, talented, and hard working. I feel for them.
I think that people forget the Intel like most companies is a “at will” company. You are hired at their will and can be let go at their will. At any time, for any reason. Layoffs, or be fired. I think sometimes, and again, this is just my opinion, that people get so complacent in their jobs, that they just assume that they should be the most valuable ones and that they of course will be spared in the case of a layoff. Unfortunately that is the furthest from the truth. My husband has been through countless layoffs, and there is no rhyme nor reason for how he has managed to survive all of them that have happened in his 20+ years with Intel. But I am sure if you dig deep enough into his work history, the projects that he has worked on, the contributions that he makes, and the groups that he has worked with, he at this time must be considered a valuable asset to Intel.
Well, as an employee that was let go this week (actually, my last day is in a few weeks), I really don’t get it. There are three people on my team. They let two of us go. I have a skill that very few people at Intel have (A specialized programming language and I’ve trained anyone else who has the skill), and I am certainly the most expert. I received a divisional award a year ago because of my Intel wide contributions with this skill. I received the highest rating during the last focal. The guy that is staying has been around longer. I was a little shocked that performance played no part in the decision, but I am at least grateful that Intel is treating the situation with some dignity. The severance package it pretty nice too
Life isn’t fair, and neither is the layoff process. Sad truth of the matter. But like you said, the severance package is nice. Clearly you chose to take it, and not enter the redployment pool. Is this a skill that you can take to another company or are you going to have to start over again? I wonder if Intel is counting on a given number of employees choosing not to enter the redeployment pool or leave the company before the layoffs in order to hit a certain attrition level?
Attrition is definitely playing a big part in the overall reduction numbers. When Paul outlined the 10,500 number, he explained how a few thousand of that was from attrition.
Well, the money is better if you take the immediate severance, and there are no open reqs at the moment, so the choice is pretty clear. Also, if you take the redeployment option and find a job before your time is up, they stop paying you. Of course if you find a job outside of Intel, how would they know…
I’m lucky that I can walk into a contract position with an old employer. Most folks aren’t going to have that luck. I’m a technical writer, and the programming allows me to automate tasks, build new functionality, etc. to FrameMaker. I’m hoping that I can implement that with the new company and find a permanent position with them.
Speaking of that… I’m a technical writer, as I’ve said. We generally fall with the marketing group. So our marketing group decides to cut our jobs instead of actual marketing people. My manager says that they’ll most likely contract out the job function. Not sure why she said that other than to piss me off…
Does that sound like they are following the intent of the SET project?
Hello, I’m an Intelite and I’ll know my fate today. Hopefully I get to stay as I very much enjoy my current job. I haven’t been working on a “Plan B” So if I get tapped I’ll need to act fast to get another job.
Having said that, I think it’s all about a person’s attitude as to how they handle the current situation. It seems that some of the comments here have a “victim mentality”. Yes, working at Intel in the US is “at will”, remember that it is a two way street. You can give your 2 week’s notice and leave Intel for any reason as well.
We all have choices in this world. Most people I know that have either left Intel or been kicked out during the 6 month layoff period have found jobs for substantially more money than their Intel job. One person got $15,000 more another one got 40% more. There is a life outside of Intel, you never know what could be out there.
Please don’t misunderstand me, I work hard at Intel and have for over 11 1/2 years, but I don’t believe that this is the only company in town. I work hard to maintain an optomistic outlook, I just can’t live in the doom & gloom.
Purplegirl,
I agree with you. There is life after Intel. I hope that you get good news today!
To quote Josh:
“One thing that happens when things are drawn out for as long as they have been (six months), with everyone worried about their job, being less productive, and feeling the stress of not knowing, is that the really bright, talented, “best” people leave the company for somewhere else. And then you’re left with the people who were only worried about defending their job/justifying their existence.”
This is clearly an oversimplification. YES, the company is bloated and full of people just putting in their time. YES, there are too many people who aren’t good at what they do. But there are also many groups full of those who are. I work with some very smart, talented, and technical people. And yet I also see a lot of very non-technical people in charge of technical matters. This practice needs to stop - module owners need to know their supposed area of specialty in and out instead of being meeting jockeys for a living.
The suggestion of a lottery would only increase the odds of people being mismatched to their jobs and being under-qualified compared to a well thought out approach. I say it’s a dumb idea. Sorry. But it won’t make Intel a better company any more than the status quo will.
Like any asset, albeit the only one with an ego, humans should be treated according to their value relative to the customer’s (company’s) commercial objectives. If, say, you have a need for X core engineering assets (humans) and have a supply of X + 3, you “redeploy” 3 of them. I can understand that until the legal litmus tests are spun to sound like performance criteria. For many years, my managers have applauded my efforts and graced me with promotions, salary bumps, and bonuses. Now I’m a perfect “affected employee”. I’m not the worst performer nor the newest on our team; the others will testify to that. I can guarantee that I have the highest salary; I’m a U.S. citizen; I’m a white male; I’m not gay; I don’t have a life partner; I don’t have a visible disability or covered sickness; I’m a known boat-rocker and get paid for it; I’m not yet 50; and I have a convenient brown mark on my HR record. I would want to keep me but that’s to be expected.
Performance rankings/ratings cannot be fully objective without a valid statistical sampling of comparable efforts in comparable times with comparable constraints and resources. The lottery is at least blind but that doesn’t make good business. Being driven by legal-fee-avoidance is cowardly and the chosen strategy for Intel’s “efficiency actions”.
Otellini is in trouble. He can’t afford to have a heart or a brain. Barrett hosed us and Robin Boy Wonder is coming to our rescue. I mean, their rescue.
How about a paintball lottery? We put a department in a room and give each person a paintball gun with 3 balls in it. The 10% with the most spots on them at the end of the firing period (10 minutes should do it) would be the ones who hit the door.
I would be interested to see how many people:
a)Shoot one person 3 times
b)Shoot themselves 3 times
Came across a new user community trying to help people find out what it’s like to work for a company. There isn’t much in the way of data yet but between surveys and forums it’s a pretty interesting concept. It’s called Bizoplia (whatever the hell that means) and is at http://www.bizoplia.com
Gray
@Gray what a terrific idea!