Are layoffs socially responsible? // 12.11.2008 at 10:01 AM
by Tim Sanders
How many layoffs has Southwest Airlines had? Zero.
How many for SAS Institute. Same number.
Why? Both founders/CEOs are willing to do ANYTHING to avoid them. They don't see layoffs as a natural response to economic downturns, usually taken to please value investors on Wall Street. Southwest was a market rebel and SAS Institute stayed private.
In my view, socially responsible companies don't have layoffs when they are still viable or making money. It is not an expense reduction strategy with an upside. I'm not alone in this view. Last week, Barry Diller went on record saying that layoffs are a horrible thing to do to people and society when your company is not at risk of bankruptcy. For once, I totally agree with him.
Check out this video interview: Mass layoffs by profitable firms a horrible act
Beth Kuchar on 12.11.2008 at 10:27 AM
I absolutely agree - and it seems to me that in battening down the hatches in preparation for tough times ahead, companies are creating a self-fulfilling situation... more and more people lose their jobs and have no income therefore consumer spending continues to decline - meaning fewer people buying the products and services these companies are producing! It's scary what a vicious cycle it could become.
Instead, companies should look at other methods of running leaner: ways to reduce their own waste, reduce energy consumption, and optimize their resources. They can save costs while also doing something socially responsible.
Alan Baker on 12.11.2008 at 12:21 PM
And on top of it, companies' most important assets are their employees. People are an extremely valuable asset as they are the ones making your products and services valuable.
Like any investment, you make money from people in good times, and you may lose money in bad times, but in the end, the investment in your people is a sound financial investment.
For example, my company has a network of freelancers. We're currently exploring ways of putting some of them on a part-time payroll in order to alleviate some of the financial stresses of this downturn. Is it the best fiscal policy? Maybe not, but they've taken care of us in the good times, and we hope to take care of them in the bad times... and in the end, we maintain quality standards with quality workers.
- Sign Up
- Log In
Start making a difference today.
Already have an account?
Buy the Book
Saving the World at Work (Hardcover)
by Tim Sanders
What’s the Buzz?