Woah, a lot of posts to reply to. I'll just stick to the most germaine ones.
Fifth Element said:
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.
Fifth Element said:
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?
Fifth Element said:
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...
Fifth Element said:
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.
Fifth Element said:
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.
Allister said:
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?
seankreynolds said:
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.
Fifth Element said:
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?
