The past year we’ve witnessed a slow down in the technology sector with drops in sales and profits. Even Apple has been impacted. Along with the downward spiral various technology companies have laid off or plan to lay off employees. Here’s the short list.
Cisco announced a plan to layoff 14,000 employees, about 20-percent of the company’s workforce. Microsoft stated the binge layoffs a few years ago when it said 18,000 jobs would be slashed. Last fall, HP announced that 33,000 jobs could be cut over a three year period. This year, Intel announced that 12,000 jobs would be cut worldwide, about 11-percent of its workforce.
What about Apple?
Our favorite Mac maker is more discreet about such matters so there is less visible to the public. Apple remains structured different than most competitors and, for the most part, farms out manufacturing of both components and products to others which mitigates employee troubles (if you ignore the history of some of Apple’s suppliers).
Roughly half of Apple’s nearly 70,000 U.S. employees work in the company’s retail stores, a business segment with traditionally higher employee turnover, so there is less need to layoff employees when sales go down.
That brings me to a few simple questions.
First – What does it say about a company’s executives who cannot figure out what to do with 10,000 highly trained employees? Yes, markets change, plans go awry, things happen. But 10,000 employees is a huge number, which means the organization up to that point was poorly organized (or, at least, not efficiently organized) and needed to be gutted vs. pruned.
Second – What happens to those executives responsible for those being laid off? Are they not the same ones who planned for, hired, trained, and managed the employees who were no longer needed? It seems to me that the company would be better off without the executives that took the company (or division) down the wrong road should be among those laid off.
Third – Why doesn’t this happen to Apple? Apple has executive churn and employee turnover, just like any other company, but not to the same drastic level as other tech giants in silicon valley. Why not?
Finally – What does Apple do differently than technology competitors that minimizes or mitigates such layoffs, and why can’t other technology companies figure out what Apple does that prevents those cosmic changes and follow accordingly?
I understand the need to prune employee ranks. I’ve been on both sides; as an employee when co-workers were axed by management. And as an executive who ran a division with employees when headcount needed to be pruned. Unfortunately, I’ve never seen it done surgically. Such layoffs often are indiscriminate slashes to reduce payroll to achieve a board room dictate, rather than any detailed consideration of employees needed to perform specific tasks.
Why is Apple different?