Thousands of employees have recently been ‘let go’ from some of the biggest tech companies in the world, as evidenced by sites like layoffs.fyi. Why is that?
Many of the big players have released statements citing over-hiring during lockdown, when e-commerce surged, and more generally, current market uncertainty. Other reasons include inflation, economic downturn, investor pressures and the tech industry generally maturing. No matter what we view as the reasons (hindsight is easy of course), these companies should probably not have scaled-up so quickly just by adding headcount.
In general, people should not be viewed as fungible ‘human resources’ and scaling a company is more than just adding numbers to the little empires represented by boxes in an org chart. As David Carboni writes ‘ “resource” says “you don’t matter to me”. That’s a toxic dynamic for any human endeavour.’
That is exactly what we saw with this hiring and firing boom and bust cycle: companies carelessly hired and fired based on what they thought would be best for their business, completely disregarding the implications this had on people and performance down the line. This is a very unsustainable recruitment approach that costs companies thousands per employee and can devastate the lives of people who are laid off through no fault of their own. Simply put, nobody wins.
“It’s not enough to simply hire talent with the necessary skills to carry out their roles in the present. Over time there will be changes in technology, industry direction and business needs, and you’ll need a capable workforce in order to keep up. ”
We need to re-think hiring, training and learning & development activities in terms of capability goals and consider how individual capabilities (mindsets, skills, attitudes, and other personal strengths) combine to form team capabilities and how they can be combined to create the organisational capabilities needed to meet strategic goals.
Organisations need less job title vacancy filling and more hiring for the creation of diverse capability portfolios that can help employees grow, and adapt to changing needs rather than just get laid off when their job title doesn’t exactly match what is needed in the future. As Caroline Castrillon reminds us, employees with career development opportunities are more motivated, and are more likely to exhibit growth mindsets.
Many commentators fear job losses as a result of increasing automation, and if you already treat people as expendable, fungible, generic ‘human resources’, then it is only a small step to replacing them with robots. But as Noah Smith writes, we should be embracing automation and using it to create better, more meaningful roles for humans, rather than treating them as replaceable meat-bots.
Instead of boom and bust hiring, or measuring executive power in terms of the number of ‘reports’ that dangle from their branch of an old-style org chart, we should be hiring and developing people carefully with long-term capability development in mind.
I recommend focusing on capability mapping before making hiring decisions, and also on better learning & development practices, such as providing a wide variety of learning resources rather than mandating classroom learning to prepare your organisation for the certain uncertainty ahead.