Layoffs is a cyclical short-term approach to looking good to shareholders on the balance sheets. In long-term those same jobs will need to be re-filled. In end, it costs more because not only does one have to layoff people with redundancy packages, but in a few months one will have to hire people to fill those same job roles. In MBA schools, the first course of action taught is to let go of people to resolve financial issues. As a result, such degrees teach a disconnect between management and employees. An alternative approach is to selectively shrink the middle and senior management within the organization.
What this means is that:
- less people to layoff
- reduces red tape so the organization can function more efficiently, productively, and get things done quickly
- layoff people who set such performance targets for others and don't meet them in first place
- letting go of those managers in most cases will result in not having to re-hire either because it would have solved many internal issues in process and then can set more realistic targets for the future
- save on future costs where one may have to consider layoffs again
- something that acts as a quick fix in short-term is likely not a long-term solution
- better looking balance sheets as managers get paid more than employees so the sum total will reflect more in cost savings when it all adds up
- managers are also then held accountable for organizational-wide, team-wide decisions which may have collectively cost the business
- reduce the recruitment costs every year from cyclical layoffs and re-hire
- produce more stable balance sheets that are reflected in the long-term performance of the organization which means more opportunities for finance and business
- reduces employee turnover
- organizations become more responsible and accountable for people and their local communities
- not having to let go of the best people
- increases employee moral as they can maintain stability in their lives from working with a responsible organization that practices rational and strategic decision making for the long-term
- reduces the collective expense in benefits packages
- reduces the toxic culture that may be brewing in the organization through excessive and unnecessary politics
- reducing employee head count does not reflect well for the future of the organization
- layoffs invariably are a sign of bad leadership
- laid off employees may hold resentment and ill-feelings which brews on the social media and effects brand value
