WotC's Annual Xmas Layoffs

[ggroy]

81% of HAS shares are held by institutional & mutual funds. (90% of the HAS shares float is held by institutional & mutual funds).

All it takes is a voting block of funds which collectively own more than 50% of HAS shares, to veto or vote down anything they don't like. They can even vote to kick out the management and replace them.

 

[Azgulor]

Many people have pointed out that this probably relates to the end of the Hasbro fiscal year and the need to please shareholders.

And they would be wrong.

WotC is a division of Hasbro. There are no publicly-traded shares of WotC stock. Layoffs at WotC might be a short-term fix/attempt to drawing WotC expenses in line, but the fact that this happens almost every year would point to a poorly run division, one that is not as profitable as it should be in the eyes of WotC execs or Hasbro execs, or both. D&D is a small slice of a division, which is a small slice of the parent company. WotC layoffs likely equate to a rounding a decimal from a Hasbro point of view.

In the limited ability for an outsider to perform an analysis of what's going on & why, it would be relevant to know the following:

1. Do the (mostly) annual WotC layoffs extend to other product lines or just D&D? If it's across the board, then it's a managerial practice. If it's just specific product lines, then someone's turning a critical eye towards that line.

2. Does Hasbro have similiar annual layoffs across other divisions & product lines? If so, then this is likely a practice that originated with Hasbro. While reducing expenses may result in greater profits (sales have to stay consistent or increase, however), they'd have to be sizeable cuts to increase profitablility and result in a better stock price and return to shareholders.


This far into the cycle, however, the fantasy of the evil overlord of Hasbro forcing WotC to do things rings false. If Hasbro was this heavy-handed and was doing this solely to reduce expenses, then they should wipe out the WotC execs as the execs presumably make more than designers, etc. Since this hasn't happened, and since WotC continues to have its own executive & managerial staff, I contend that these are WotC decisions.

If the theory cited in #2 above turns out to be true, then the WotC execs are toeing the company line. But they're still picking who's getting the axe.

I know many gamers like to think of Hasbro as the corporate suits & WotC as "gamers like us", but it's a business first folks. Fantasies you tell yourself so you can feel better about supporting the brand doesn't change that.

 

[ggroy]

2. Does Hasbro have similiar annual layoffs across other divisions & product lines? If so, then this is likely a practice that originated with Hasbro. While reducing expenses may result in greater profits (sales have to stay consistent or increase, however), they'd have to be sizeable cuts to increase profitablility and result in a better stock price and return to shareholders.

Here's a recent non-WotC Hasbro layoff from October.

Hasbro to temporarily cut 180 manufacturing employees at East Longmeadow plant | masslive.com

 

[Azgulor]

Here's a recent non-WotC Hasbro layoff from October.

Hasbro to temporarily cut 180 manufacturing employees at East Longmeadow plant | masslive.com

Interesting. Although the 180 are cited as "temporary layoffs" (we'll see) and represent about 3% of Hasbro's workforce is Hoover's is correct.

 

[Klaus]

Here's a recent non-WotC Hasbro layoff from October.

Hasbro to temporarily cut 180 manufacturing employees at East Longmeadow plant | masslive.com

And May: Hasbro to move 70 jobs from Mass. to R.I., lay off 75

 

[Nemesis Destiny]

It's actually been only the last few decades that there's been a push to define corporate responsibility as exclusively toward shareholders as opposed to other stakeholders including the employees and surrounding community.

You mean the same few decades that have seen executive pay get launched into the stratosphere compared to that of a typical employee?

The push to define corporate responsibility is nothing more than lip service. One thing drives the corporate machine: greed.

I don't want to further derail this thread though. If you want to take it elsewhere, I'll be happy to oblige.

 

[OnlineDM]

WoTC's decision makes perfect sense; in the mad-as-a-hatter, through-the-looking-glass world that is modern business practice. Remember, this is the same genius mentality that has brought us climate change and the credit crunch, and it is all summed up in one phrase;

False accounting!

It is false accounting to pretend that laying off Rich Baker will only result in
his salary and benefits being recovered; yet that is all the balance sheet will show. It will not show that debacles like 4E are a direct result of pushing everyone out of the door who really understood the 'soul' of D&D. But 'talent' and 'wisdom' cannot be measured and therefore cannot be real can they?

It is also false accounting to say that burning fossils fuels is cheaper than alternative energy sources; this ignores that damage that will be done to the economy of the world by climate change; damage that is now estimated to be 100s of trillions of dollars at the very least. And this is without even considering the harm done to animals and plants.

The sad fact is that we live in a world that allows the greedy to ignore or destroy anything real that cannot easily be measured just so they can get rich. We also allow these crooks to move around so much that they are never around when payback time comes; that's why we have the current financial meltdown because bankers realised they could sell loans they KNEW would go bad but which made them so much money that they knew they would be on their yacht in the Bahamas before the smelly stuff hit the fan.

That is the 'logic' of our world; it is ugly, cruel and mad so don't even try to tell me it makes sense.

It's not false accounting; I have no reason to believe that there's anything shady or non-GAAP going on with Hasbro's or WotC's books.

It may be, however, short-sighted management. If it's the case that the product line will suffer in the long term from getting rid of these employees, then the business will eventually do more poorly than it would have had those employees been retained.

There's nothing incorrect or false with the accounting, but it's totally legitimate to argue against the business decision.

 

[Ydars]

You misunderstand me; I am saying that all business accounting is false accounting because it takes notice only of $ and only in a very narrow time slot.

This is obviously wrong but things are set up this way to allow bad practices to continue in the name of 'commerce'.

To be a true accounting, all activity should be audited based on its effect on society and on the environment. This can and has been quantified in monetary terms but business doesn't want to know because then they would be forced to act responsibly.

I was just setting WoTC's practices in context.

 

[ggroy]

To be a true accounting, all activity should be audited based on its effect on society and on the environment. This can and has been quantified in monetary terms but business doesn't want to know because then they would be forced to act responsibly.

In practice, this would be very difficult to do with any mathematical precision.

Even if there existed some precise mathematical formulas, such formulas can be gamed and will be misused to the max. A tangential recent example of this, is the abuse and misuse of the Gaussian Copula in the mortgages financial market.

Recipe for Disaster: The Formula That Killed Wall Street

 

[Umbran]

Ladies and Gentlemen,

This thread, and EN World in general, is not a suitable place to attempt to indict or defend general economic policy, or large scale corporate behavior. We've got a "no politics" rule, and it applies in this case.

Thanks, all, for your time and understanding.