Over the next year, Microsoft’s executive management plans to lay off 18,000 employees, including factory workers and those in professional positions.
Redundancy. As Microsoft acquired new companies, at least according to the news reports that tend to take a company’s press release and spokesperson responses at face value, they have the potential to take advantage of consolidated businesses. For example, when two companies merge, there may be no need to carry the legal team from one of the companies. The resulting larger company can probably function just as well with one legal team. Administrative departments can be merged and reduced.
There’s good advice out there about avoiding lay-offs. Make yourself indispensable to your company by working harder than everyone around you, gaining more knowledge about the organization, being involved in the corporation at a deeper level than what’s expected. But as good as that advice sounds, events like these — Microsoft’s decision to eliminate 14 percent of its workforce — are good reminders that you can do everything right, follow all the advice, and schmooze your bosses sufficiently, and still have your position end up on the cutting room floor.
Some time ago, I wrote about several signs you’re about to lose your job. These signs are all related either to your behavior or the behavior of people around you. But I didn’t mention factors that have little correlation to you or your performance. As 12,500 of the Microsoft 18,000 are seeing, simply being in a successful company, one that gets acquired by or merged with another, can signal a round of layoffs is on the horizon.
For the small business owner and employees who work in start-ups in today’s feverish start-up economy, it pays to be aware of this.
If your company has been acquired by another, one of the first things you want to do is start looking for a new job. Even when two companies that are roughly similar merge, there is a shift in culture. And that could be experienced not just by the acquired company, but by employees who work for the purchasing company as well. Changes like these shake up the employees and the management, and your routine may change. It could feel like working for a different company, not the one where you’ve been employed for a certain amount of time.
There’s something to be said for being able to adapt to a new culture. Many who do are able to eventually feel comfortable in a changed environment, and many of these with the fortitude to adapt will see themselves succeed at the new, combined organization. But you could still adapt perfectly without being immune to redundancy-based layoffs. Sometimes there’s just nothing you can do.
If your department looks like it could be combined with an existing department due to a merger or acquisition, if your role is potentially duplicated elsewhere in the company, or if you’re otherwise affected by a combination even if just culturally, start brushing up your résumé and looking for a new job. Don’t wait for the pink slip to begin your search.
You might feel that you’d rather be laid off and receive a severance package than quit right away, but if you do find a new opportunity that matches the culture you expect and is a good enough offer, there’s little reason to wait around. In fact, you can use an expected severance package in your current job as part as your negotiation tactic if you find a new job ready and willing to hire you.
At the same time, if you have the capacity, it’s always good to spend some time focusing on the potential for starting your own business. Years ago I wouldn’t have even suggested this. After all, most attempts at entrepreneurship fail and people who attempt to open small businesses often return to the traditional workforce. But starting up does work for some people, especially those who have high stakes and are motivated to keep trying. Sometimes, like I’ve found, you never know that you have the potential for business ownership until it just happens.
When this website was acquired by a large company a few years ago, I agreed to be an employee for the purchasing company, continuing to edit the site, work on related projects, and help the company achieve some of its stated goals based on my expertise. But before long, the company included me in a round of sweeping lay-offs, and it took me by surprised because the company had no other person to do the work I was doing.
I shouldn’t have been surprised. I still consult for that company today, as evidenced by my continued presence as editor here, but in a much more reduced role. It actually worked out better for me because it has freed me to do other things I want to do much sooner than I would have been able to do them otherwise. But as safe as I thought I was after being engulfed by the company, no one is ever safe. There’s probably nothing I could have done, no better performance I could have attained, no better networking with the decision-makers I could have done, no self-help book I could have read and internalized that would have changed the outcome. I’m pretty sure I still came out of the arrangement as the “winner,” but that doesn’t particularly matter.
Layoffs can happen to anyone, anytime, and the probability is heightened following mergers and acquisitions, regardless of which side of the deal any particular employee happens to be on. Like Robin Williams said to Matt Damon in the Academy Award-winning Good Will Hunting, it’s not your fault. Well, sometimes it is, but with a massive round of layoffs like the one planned by Microsoft, often it isn’t.
People who have survived a large round of layoffs will happily tell you their secret: the skills they have, the attitude they project, or the corporate political games they play that allowed them to pass through unscathed. I would ignore most of that, because there’s a great chance that many people who have done the same still saw their positions eliminated. There’s a tendency to think that two things are causally related just because they happen around the same time. In this case, those two things are an employee’s behavior and the avoidance of a lay-off round. But when companies make decisions like these, the bulk of the decision making doesn’t take anything like this into account.
In fact, if anything else, the decision is purely financial. Given two people in a redundant role, the winner will probably be the employee who costs the company less. And costing the company less is something that good employees rarely do because they’ve often successfully warranted and negotiated better-than-average compensation.
Have you been affected by a large round of layoffs at a company? What were your experiences?
Published or updated July 17, 2014.