layoffs?

[Elrith]

What really bothers about these layoff is the fact that when business people talk about building a "brand" (an ugly word, but perhaps better than "property") they almost always emphasis a personal connection with the consumer. WotC has been doing this with Magic for years, and over the last three years has really pushed D&D that way: the Design and Development columns by Mearls, the almost unused R&D Blogs, the convention blogs and video coverage, and the podcast. They made Noonan a major face for the "brand" (I think) because he's a very good RP writer with good ability to convey his enthusiasm in an intelligent and respectful manner. So the layoff looks really bad becuase he's one of the few faces that Wizards has presented to us. They damage their image not only by laying people off before the holidays, but also by laying off people they made the representatives of D&D.

Laying off Tweet makes me think of when the Oilers traded Wayne Gretsky...

[Scribble]

Originally Posted by joethelawyer

Exactly. At the end of the day, you still have to worry about putting food on your kids plates, making the house payment, and trying to put away a little bit for the kids college and your retirement.

Whether you got some severance package or not, whether it was due to your performance or not, whether you get a handshake or a kick in the ass, when you walk out the door that last time, it sucks.

Having been laid off before I can say it does indeed suck. One thing though that offers a slight glimemr of happy in the sea of suck... is that with a layoff at least you can approach the next prospective employer with most likely a positive past experience.

Whereas when you're fired, you pretty much have to start with: Yes, I was fired, but here's why you should still hire me.

Not having to overcome a negative mark is at least something.

Ultimately it still sucks, and my heart goes out to them all.

[joethelawyer]

Originally Posted by Dannyalcatraz

The enforceability of a NCC hinges on several things, not the least of which is whether it is "unconscionable," the scope of the NCC, and the geographic area it covers.

Whether a NCC is unconscionable is a balance test between the company's valid reasons for having the NCC in the first place and the ability of the person covered by it to find gainful employment.

Given that the RPG industry involves precious few true corporate secrets- things that would be on a par with KFC's secret recipe, for instance- it would be hard for a court to justify barring someone from working in the biz on that rationale.

Ditto the size of the industry- despite the explosion in the number of companies since the dawn of the hobby, the number of professional level game designers probably wouldn't fill a mid-sized auditorium, and most of them probably know each other on sight. This also means that there aren't many vacant slots to be filled at any one time. (Besides, can you imagine what trying to get a job with another RPG company if you were known to be the one who tried to get a NCC enforced?)

Given the nature of publishing these games, the geographic coverage of a NCC would be considered national or international. A court considering enforcing a NCC would presumably ask the party seeking its enforcement to meet a high burden of proof.

Put all together, its unlikely that a court would enforce most NCCs in the RPG industry, assuming a company tried to enforce one.

You're a lawyer too, right Danny? You analysis is my understanding as well. My concern, however, is that I have heard of situations wherein the company essentially offers two different compensation packages upon termination, one with a strict longer term non-compete, one without. Obviously the one with the better compensation package has the more restrictive non-compete clauses.

That may have some impact on whether or not a person even tries to fight it, especially if the money in the compensation package is doled out over the full time-frame of the non-compete agreement. It also makes it not a pure non-compete agreement fight, under the framework you laid out above. It blurs the line into making it a bargained for contract of another sort, with valid consideration for the non-compete. Do you have any experience with such situations?

Which goes back to my earlier post--does anyone with WOTC experience know how they draft their non-competes and terms of termination agreements? Can these guys be hired by Paizo on Friday?

[Mokona]

Another source of information:

Full story at ICv2 - Digital Consolidation at WotC

...
Reached for comment by ICv2, a WotC spokesperson noted, “Wizards of the Coast consolidated its digital game organizations to streamline execution of digital growth strategies for core brands.”



Wizards of the Coast President Greg Leeds also weighed in. “Consolidating internal resources coupled with improved outsourcing allows us to gain efficiencies in executing against our major digital initiatives Magic Online and D&D Insider,” he said. “Wizards of the Coast is well positioned to maximize future opportunities, including further brand development on digital platforms. The result of this consolidation is a more streamlined approach to driving core brands.”
...

[Friadoc]

Originally Posted by joethelawyer

Exactly. At the end of the day, you still have to worry about putting food on your kids plates, making the house payment, and trying to put away a little bit for the kids college and your retirement.

Whether you got some severance package or not, whether it was due to your performance or not, whether you get a handshake or a kick in the ass, when you walk out the door that last time, it sucks.

It most definitely does suck and hurt, more so if the person affected has not had any direct and real lose, such as a loved one passing or such, since we tend to put so much of ourselves into our job, often told as we grew up that if you are good, hard worker that you will always have a job. Yet, suddenly, a good hard worker is laid off through no real fault of their own.

My first lay off happened just before I turned thirty-two, literally the week before my birthday, a handful of weeks after we splurged and bought a new PC, as well as the week I started my GenCon plans (I didn't go) and in the midst of a freelance project.

It came out of no where, so much so that I had narrowly avoided buying a house, due to the inability of my company to answer a simple question, all while saying that our jobs were safe and sound. So, while it was mostly unexpected, there was that one hint, yet I was a hard worker, always putting in extra time when asked, and a team player. I was, literally, the third person to go, right after the two people in the company who were our anchor statements, i.e. So long as So-and-So has a job, we're safe. Thus, the two bad examples got let go and then myself, as well as a few other folk.

I was stunned, I didn't know what to tell my girlfriend (our lil' man just turned one a few months earlier) and it sucked. I went out drinking that night with a friend, who was there for me, as well as his brother, when I was laid off again.

It is an odd hurt, both times, hence those suffering it have all the sympathy and empathy I have, hopefully something, anything, said by us on here helps them a bit, which it seems to so far, and that's a good thing.

[ruemere]

First of all, a piece of music, "The Piano [Life is a song]":
[ame=http://www.youtube.com/watch?v=4Z2ljWwIaHs]YouTube - The Piano [Life is a song][/ame]

Secondly, it appears to me that WotC has problem with forming long term plans with regard to media:
- premature switch to digital form of periodical media
- lack of clear and supportive policy for indirect business partners (GSL)
- high degree of staff turnover

Thirdly, latest products contain rehash of 3.0 and 3.5 material adapted to 4E or somewhat problematic reinventions of older stuff (no new settings, somewhat slow and awkward support for already published settings). Examples:
- reinvention of FR, which alienated large portion of fanbase - best business solution would be to build new subset of realms to appeal to new fans while providing support for continuity of campaigns of old time fans
- popular settings of Greyhawk, Dark Sun, Ravenloft, Eberron suffer from serious support delay for those who would like to convert their campaigns - digital media should support such switch upon release of 4E to enahnce appeal 4E instead of forcing people to choose or convert by themselves
- there is no promise of continual support, merely 3 books per setting intention - this is good for novices, but may be not sufficient for those who invested into 3.x over the course of several years


In the light of the above, I feel doubly sorry for those who leave. May you find some nice place in this rather fragmented market.

I also feel sorry for those who stay, since it will be their duty now to carry on with supporting rich culture of D&D worlds. I hope you can do this... mind you, I don't like 4E, but I would hate even more to see such large part RPG world to suffer further.

Finally, to all. It's not the end of the world, there is infinity of imagination to live through and put on paper. It's just that I hope that all the talented people will find ways to contribute to gaming community (and prosper, of course).

Regards,
Ruemere

[Fifth Element]

Originally Posted by Scribble

Having been laid off before I can say it does indeed suck. One thing though that offers a slight glimemr of happy in the sea of suck... is that with a layoff at least you can approach the next prospective employer with most likely a positive past experience.

I've been laid off once in my career, and I've resigned twice. The resignations were much more pleasant, from my perspective. But you're right about the positive experience. Hopefully, in the case of a negative experience, you're able to resign before being let go (as was the case with my first resignation).

And I want to say that I hope all this discussion doesn't distract from the sympathies being given to these great people who are now out of work. They certainly have mine.

[StarFyre]

my best wishes to those affected.

very sad

Sanjay

[Kamikaze Midget]

I think I need to defend WotC a little bit here.

First, there's this from Fifth Element that bears repeating:

Originally Posted by Fifth Element

Developing a new edition requires far more work than a regular publishing schedule. Layoffs are de rigueur shortly after a new edition release, because staff was built up beforehand to develop the new edition.

I just think it's simplistic to suggest that a "well-run business" should not have layoffs. It's more complicated than that.

The savvy folks who watched the Coasties for the last decade or so probably were expecting this. It happened in 3e, it happened in 3.5, and it'll probably happen again afte 5e. I believe in both 3e and 3.5 it happened during the Christmas season.

Second, while a lot of the emotion of Monte's post resonantes with me, there is a little something at work in the idea of "fire the senior developers."

The idea is that no business likes to lay off people. They do it because they have to, not because they want to.

Getting rid of the senior members of the crew allows them to fire the least amount of people to save the greatest amount of money and with the least amount of regret (because it's easier for experienced management to find jobs than it is for Billy the New Guy). It's something of a balancing act, because they do need to remember what happened in the past (which requires those senior members), but they also need to cut expenses.

I'm not saying it was an entirely genius idea from Wizards. They probably could have spread it out better, hit several different levels, and maybe timed it better (can't you let people enjoy their holidays before you depress them?).

But there is logic behind this axe. They're not being Big Evil Corporate Overlords of Evil. They're running a business.

And, on the bright side....these great editors and designers can still find work through the OGL. I'm sure if they want it, it's there.

....though part of me is now REALLY SAD about the GSL being so FUBAR'd, or they could just go on writing 4e stuff.

[Allister]

It's why you don't see the same thing from the M:TG side of WOTC. (If there are layoffs on that side, then WOTC is in big trouble).

M:TG is basically always producing a new edition every 4 months so there are never mass layoffs from that side....

[Darrin Drader]

Originally Posted by joethelawyer

Darrin, Monte, or anyone who knows how WOTC operates, do you know if it is their standard operating procedure to have employees sign some sort of non-compete agreement either as a part of their employment, or as a condition for a larger severance package? Just wondering about these guys' ability to work in the industry in the foreseeable future.

Unless things have changed drastically in the past four years, the noncompete lasts only as long as they work for the company. Also, again dated information because I haven't been there for a few years, but you could ask permission to work on projects for other companies and still work for them. Such requests were usually approved as long as they didn't see it as a danger to the brand. Back then, nothing was seen as a danger to the brand, not even other D20 projects, so it wasn't a problem. These days it might be a little more strict, but I'm fairly positive that once you're shown the door, you're free to write for whoever.

[Fenarisk]

Originally Posted by Elrith

What really bothers about these layoff is the fact that when business people talk about building a "brand" (an ugly word, but perhaps better than "property") they almost always emphasis a personal connection with the consumer. WotC has been doing this with Magic for years, and over the last three years has really pushed D&D that way: the Design and Development columns by Mearls, the almost unused R&D Blogs, the convention blogs and video coverage, and the podcast. They made Noonan a major face for the "brand" (I think) because he's a very good RP writer with good ability to convey his enthusiasm in an intelligent and respectful manner. So the layoff looks really bad becuase he's one of the few faces that Wizards has presented to us. They damage their image not only by laying people off before the holidays, but also by laying off people they made the representatives of D&D.

Laying off Tweet makes me think of when the Oilers traded Wayne Gretsky...

I'm sorry to break this to you but 99% of the people who buy and use D&D products have no idea who these people are and don't recognize/care about the names. Consumers purchase a product and don't really notice or need to notice authors or "behind the scenes" people. I've played D&D since 2e and I have no idea who any of these people are, and still don't.

Not to say the layoffs don't suck, I'm sure they do for those involved, but the majority of consumers won't even know or won't care. Also it's always the middle of the week between early November and mid December that layoffs happen, usually due to restructuring during budget time before the next fiscal year.

[Ghaerdon Fain]

I'm willing to write this and take the criticism, and indeed this is naive and ignorant, but I don't like the business of DnD and have never seen it as a business. Gygax did I'm sure, but what I bought as a youth was more than just some game out of a business model. What I always liked was that TSR seemed to "care" about its fans and its contibutors [emphasis on "seem"].

I'm pissed. Letting these people go now seems wrong especially given the supposed success of the product line. I have stuck by 4E and bought a copy of everything at least once, now I am not so keen to suport this bunch of goons. I hope and pray Dave finds a great job with Paizo or starts something himself... but I find this distastful, not because it's December, but because this "game" and the people behind it don't care about keeping the quality in house.

I was so excited about the Character Creator... now, I'm thinking of looking at that Paizo beta gathering cyber-dust in some obscure Folder ... maybe they care about their fan base and their employees more.

This is not the economics of the time.. this is "business" and these people didn't fit the model or brand anymore.

[seankreynolds]

Originally Posted by joethelawyer

Which goes back to my earlier post--does anyone with WOTC experience know how they draft their non-competes and terms of termination agreements? Can these guys be hired by Paizo on Friday?

I don't recall the specifics of my non-compete, but:

* The day after I was laid off in 2003, Monte asked me to write a book for him, and Wizards didn't bat an eye.
* To the best of my recollection, the elements of the non-compete relate only to things the employee was working on or had knowledge of at the company. For example, if Dave was working on the 4e book of dragons, his non-compete would prevent him from publishing a similar book, at least until some period after his termination date. It didn't address all game design in general, just "proprietary knowledge" of what the company had planned.

And FYI, because of the Microsoft ruling, Wizards can't hire any of these people back as contractors for a certain period of time (6 months?). Apparently MS had a habit of laying off employees and then contracting them at lower wages and no benefits, and in response the court ruled that companies weren't allowed to do that any more. So while Dave and Jonathan can easily find work elsewhere in the industry, Wizards has now prevented itself from accessing their talents for a while.

Please pardon my unemotional post, I've already expressed my sympathies to my friends in private.

[seankreynolds]

Originally Posted by Kamikaze Midget

The idea is that no business likes to lay off people. They do it because they have to, not because they want to.

It depends on what you mean by "have to."

If your RPG division expected to make $10,000,000 dollars this year, and it now looks like it's "only" going to make $8,000,000 dollars this year, does that mean you "have to" lay off people so your numbers are better?

If your company expected to make $100,000,000 dollars this year, but screwups with your digital initiative mean that you "only" made $95,000,000, does that mean you "have to" lay off people in other departments so your numbers are better?

To use a Hasbro example, if your overall revenue is down, and all divisions have negative revenue, and one division (say, Wizards) has positive revenue, does that mean you "have to" make 10% cuts across all divisions (including Wizards, your ONE profitable division), just so your numbers are better?

Originally Posted by Fenarisk

I'm sorry to break this to you but 99% of the people who buy and use D&D products have no idea who these people are and don't recognize/care about the names.

And 93.2% of all statistics are made up on the spot. Where is your proof of the number you cite? There are many people who DO buy books based on the author's name. Just because you aren't one of them, or you don't have anyone in your gaming group, doesn't mean that you are an example of an overwhelming majority

...

All I know is, if I see one press release in the next 12 months about how 4e is making record-breaking sales, I'm going to link to this thread, and I'll probably have to stab somebody.

[joethelawyer]

Originally Posted by seankreynolds

I don't recall the specifics of my non-compete, but:

* The day after I was laid off in 2003, Monte asked me to write a book for him, and Wizards didn't bat an eye.
* To the best of my recollection, the elements of the non-compete relate only to things the employee was working on or had knowledge of at the company. For example, if Dave was working on the 4e book of dragons, his non-compete would prevent him from publishing a similar book, at least until some period after his termination date. It didn't address all game design in general, just "proprietary knowledge" of what the company had planned.

Thats encouraging news. Hopefully they will be able to get back on their feet sooner, rather than later.

[Darrin Drader]

Originally Posted by seankreynolds

All I know is, if I see one press release in the next 12 months about how 4e is making record-breaking sales, I'm going to link to this thread, and I'll probably have to stab somebody.

Let's hope that the timing of the release and the availability of a knife don't happen to coincide with my impending tour of the Paizo offices.

[Aus_Snow]

Originally Posted by seankreynolds

And 93.2% of all statistics are made up on the spot. Where is your proof of the number you cite? There are many people who DO buy books based on the author's name. Just because you aren't one of them, or you don't have anyone in your gaming group, doesn't mean that you are an example of an overwhelming majority

Quite. For example - keeping in mind here that the gamers I know, some of whom I game with, are not by any means all 'hardcore' types, let alone necessarily even very part-time inhabitants of the interwebs - most gamers I know are probably familiar with at least most of the major names relevant to most of the games they play. Or hey, even the games they just own and haven't tried yet.

And with regards to Mr. Noonan, I suspect that well, every single person who's ever listened to one of those podcasts (and that's likely to be a lot of gamers, in all likelihood) knows his name, at the very least.*

* This is directly relevant, because of what the post i replied to was in reply to, +1 or so, perhaps.

[gribble]

Woah, a lot of posts to reply to. I'll just stick to the most germaine ones.

Originally Posted by Fifth Element

It's certainly very different from the employee's part of view, but your overriding assumption here seems to be that these layoffs are unexpected. I doubt the WotC staff looked back at the layoffs after 3.0 and 3.5 and said, 'that won't happen this time'.

You really seem to be misreading or misunderstanding me. If the layoffs were unexpected, then why would that point to poor management? As I've already stated, even the best companies can sometimes get tripped up. It's exactly the fact that they have been cyclic and expected that leads me to believe it's poor management and not just hiccups behind them.

Originally Posted by Fifth Element

Okay, we won't get into it. Though I'd suggest it's quite relevant to the discussion, and avoiding it avoids an important aspect of the discussion.

The reason I suggest we don't get into it is exactly because it isn't relevant. The fact is that most people in permanent positions have those expectations - whether or not the expectations are valid doesn't change the fact that layoffs result in ill-feelings towards the company (from ex-employees, remaining employees and customers) largely because of those expectations.

Do people get upset (heck, do people even notice?) when a contractor or freelancer who worked on a previous book isn't offered the contract for the next book?

Originally Posted by Fifth Element

Indeed. You seem to feel that WotC has not considered this.

Not at all. I'm sure they did consider it, unless the management is truly incompetent. I don't see why you'd think this or how it's even relevant...

Originally Posted by Fifth Element

Legally, yes. You've been a contract worker. Have you also been a manager? The management perspective is quite different from the staff/contractor perspective.

Firstly, yes - I have been a permanent employee, a contract worker, a manager of a small team, and a senior manager (not quite part of the company executive, but one step below and I was privy to a lot of their discussions and decision making). So you could say that I've seen it from a lot of angles, in both well and poorly run companies. Other than a business degree, what about yourself?

Secondly, what way other than legally is there to look at a confidentiality agreement? All it is is a legal way of saying "I promise I won't tell", and IME, contractors are no worse than permanent employees in respecting them. In fact, I'd go so far as to say they're usually better because as someone else pointed out, in my industry at least, word quickly gets around about contractors with loose lips and they'll find it very hard to find employment.

Originally Posted by Fifth Element

There are all kinds of reasons why this business model could be the best for WotC, before jumping to "it's not a well-run company".

Product-based software development usually has a big first release of the initial product. A lot of thinking and product design goes into that initial release, along with a large team and a goodly amount of creativity in determining the technical foundation and feature set. Then, you typically enter a maintenance period whereby a much smaller (and arguably less creative) team is involved in supporting that product. Eventually, the product reaches end of life, and the cycle is repeated with a new and improved version or even a totally new product.

Maybe I'm just naive, but I don't see how what WotC does and what the software development industry does is significantly different. As someone else pointed out there is (arguably) a more creative element in RPG design, but fundamentally they seem pretty similar to me. In fact, with the advent of DDI it's becoming even more similar if not identical...

To help me understand, perhaps you could explain to me how hiring a bunch of permanent employees to work on a single product/project for a year or two (with the foreknowledge that you'll just be firing a large number of them afterwards) is a better business model than bringing on freelance/contract workers for the project with an explicit and mutual understanding that the contracts are only for 1-2 years?

I can't see it being cheaper. Not even in raw cost, as the total cost of a permanent employee to a company is usually more than that of a freelance/contract employee, but especially not when you consider the impact on company image (and the perception of company stability) and morale of the staff not laid off. Arguably laying off senior employees to (ultimately, when the next hiring cycle comes around) replace them with new juniors could work out cheaper on the bottom line, but it is very shortsighted and will have other obvious costs. I've worked at a company that tried that, and it went very badly for them - to the point that only now (about 5-6 years later) are they finally starting to turn things around.

Originally Posted by Allister

M:TG is basically always producing a new edition every 4 months so there are never mass layoffs from that side....

That's a good point. Maybe WotC management is just too used to thinking about this model of business, rather than a more publishing/software oriented model. Although after a couple of cycles now you'd think they would start to look at it and adjust. Maybe they don't see it as a problem. While IME it isn't the best way to do it, maybe it's good enough for them so they just don't recognise it as a problem and continue with the same practice?

Originally Posted by seankreynolds

It depends on what you mean by "have to."
To use a Hasbro example, if your overall revenue is down, and all divisions have negative revenue, and one division (say, Wizards) has positive revenue, does that mean you "have to" make 10% cuts across all divisions (including Wizards, your ONE profitable division), just so your numbers are better?

Exactly. I'd also add that any business purely making these decisions based on this years performance is the very definition of "poor management" (unless of course the company is set up purely to realise short term gains, but - I hope - neither WotC or Hasbro is in this category). Management should be pro-active, not reactive. The proper response when earnings are down 10% on your forecasts is to figure out *why* it's down 10%, what the trends are and what the forecast for the next year (and probably the following couple of years as well) is looking like. If there isn't anything you can do (short term) to pull them around, the indicators are that you really do need to cut costs longer term, and you don't have better ways of cutting costs, then the regrettable reality is that laying off permanent staff may be your best (or only) option. But (to bring the discussion back to the original post that sparked everything) - it shouldn't be considered a normal part of your business operation in a well run company.

Plus, IMO, the first heads on the block should be the forecasters who put you in this position. Though that's just personal taste and not based on sound business judgement.

Originally Posted by Fifth Element

And I want to say that I hope all this discussion doesn't distract from the sympathies being given to these great people who are now out of work. They certainly have mine.

I couldn't agree more - they certainly have mine too. Perhaps we should just agree to disagree then? Although I'm genuinely curious about your thoughts on the questions I posed above. Perhaps you could PM me or fork the thread if you're interested in continuing the discussion?

[Kid Charlemagne]

Originally Posted by Friadoc

While there could be some underestimation there, I think there is also a track record on WotC's part, too, with respect of layoffs and their timing.

On the other hand, anyone who signed on with WoTC for the 4E ramp up had to realize that fewer people were going to be needed after the launch, and planned accordingly.