Where Science Meets Muse

Can a Company Claim to be Innovative and Lay People Off En Masse?

Posted by Plish on July 20, 2009

Mass Layoff Even History for the US

Mass Layoff Even History for the US

One of the things we hear a lot of now is how companies are laying people off.  You can see the ongoing statistics here.

During these massive layoffs we often hear supposedly innovative companies touting their innovative abilities and how they need to do more with less resources, i.e. less people. 

But the question is, how is laying people off an innovative solution?

It’s not!

It’s the obvious solution! 

The reasoning is simple.  With less cash coming in, minimize the outflow of cash – let people go. 

There’s nothing innovative there at all!

Why is it so important for a company to be innovative with keeping their people?

Doing so retains vital knowledge and keeps up morale in all employees.

When massive amounts of people are let go, knowledge gaps are created in the company.  Those gaps, if they ever do get filled, require energy and time to get refilled.  That breadth of experience that could contribute to the building up of the company has been purged and the net result is a loss of the potential for creative solutions now, when they’re needed.

In addition, employees  know that the typically used (but woefully un-innovative) solution to dwindling profits is to lay people off.  This breeds insecurity and lack of loyalty – two things that severely undercut homegrown innovation.

So what should be done?

Since every company is different the solutions will be different, but one possible route is to consult the very people about to be laid off.  Work with them to find a solution, ask them what could be done to maximize profits even with a lousy economy.

The answers might not only result in retained people, but increases in the bottom line. 

Now, THAT would be innovation!


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