Good Friend Gone

[RickW]

Once again, my company is downsizing. My partner who lives in the interior just got axed. She does the end user support on my system, knows it inside out. 30 years here, few years short of retirement. Will get a nice package, and a full pension in a few years. Stinks. She's out of a job, (though may end up being happy about it,) I lose my expert who deals with end user problems, and I lose a good friend.

20 years I have been in management here, and this goes on and on and on. And I'm never quite sure why. Stock price fell a bit. Profits aren't quite as good.

And they wonder why people are unhappy?

[Cornflake]

We've moved from viewing the economy as something that served people to viewing people as the raw material for the economy. That was a bad move.

[Supertramp78]

They used to call them "personnel departments". Things took a step down when they shifted to 'human resources". We are the resources that just happen to be human. Sigh.

[Marshall]

Labor costs are a BIG part of everything. For most companies LABOR is the biggest cost. There was a time in our industrial society when materials were the big coster, and labor was cheap. That's the paradigm we all grew up with. Nowdays it's the reverse. A company can't control costs without affecting labor. It's THE fact of our modern society. Human value is the most expensive thing in the nation.


(or not. . . , it could just be the Woodford Reserve talking. And it talks sweetly along with a few Nabisco Classic chocolate wafers. . . , mmmmmmmmmmmm)

[Tamarack]

Rick -- my sympathies to you and your colleague. The business world is getting ever more brutal.

[sekhmet]

It's time to change the paradigm. Human Resources are the most valuable asset a company can have.

[Dub]

Jan 20, 2009 22:22:15 GMT -5 Supertramp78 said:

They used to call them "personnel departments". Things took a step down when they shifted to 'human resources". We are the resources that just happen to be human. Sigh.

People haven't been called "human resources" for a long time. The modern term is FTE (full time equivalent). All hint of humanity is removed. And nine female FTEs can carry a baby to term in a single month.

The accounting/management philosophy is "Cost walks in on two legs." You can't save any money selling excess inventory for ten cents on the dollar but you can reduce the number of FTEs at a moment's notice.

Sorry to hear the news, Rick.

- Dub

[Ann T]

Never mind the years devoted to rigorous education and degrees and certification exams--we are "health care providers." When SmithKline Beecham closed our lab in 1996 on 2 weeks notice, management referred to all of us who were laid off as "overhead." It was a way of dehumanizing us. I confronted management, in front of all of us being laid off, and they said they did it to "ensure their future." They threw us overboard like ballast or cargo off a sinking ship. I felt like the Elephant Man: "I am not overhead! I am a human being!"

I'm so sorry you are going through this. It's rough. I extend my sympathy.

[jdd]

They must not read biz week:

Employers Avoid Axing Oldies but Goodies
Hard-pressed companies forced to make layoffs tend to cut younger workers while retaining those over 55

By Joseph Weber

Last fall, drugstore chain CVS Caremark (CVS) cut some 800 jobs in Northern California after acquiring Longs Drugs, a Walnut Creek (Calif.) pharmacy rival. Despite those cuts, the company continues to recruit baby boomers and other older workers to staff stores across the country. "We need their expertise," says Stephen Wing, director of workforce initiatives at CVS Caremark in Woonsocket, R.I. "When you're in your 50s and 60s, you're in your prime."

Companies nationwide are laying off workers by the tens of thousands. But many are trying to spare the post-55 set from the ax, a reversal of the top-down trends in past waves of layoffs. They're being driven by legal concerns—since boomers are in a protected age group—and by a need to keep experienced hands in place to keep the companies running and positioned for an upturn. "Seniority matters," says Marcie Pitt-Catsouphes, director of the Sloan Center on Aging & Work at Boston College.

All age groups are being hit by cuts now coursing through Corporate America, but government statistics so far suggest that the burden is falling far more heavily on younger workers. The unemployment rate among workers 55 and over is not only lower than for the younger set, but it has risen less sharply. Joblessness for those 55 and older jumped to 4.9% in December 2008, a rise of 1.8 percentage points from the 3.1% level of December 2007. By contrast, for their younger colleagues, those aged 25-54, the rate climbed to 6.3% in December, compared with 4% a year before, a sharper rise. The different impact comes into even more stark relief with the government's measures of employment. The number of people employed in the younger set has fallen from 100.5 million in December 2007 to 97.7 million as of last December—a 2.9% slide. By contrast, the number of those working among the 55 and older set has actually risen by 878,000, climbing to nearly 29.1 million.

FEWER BUYOUT OFFERS
Some companies have taken deliberate steps to hang on to veterans. Many, for instance, are shunning voluntary buyout offers, which tend to encourage older workers near retirement to jump ship, and instead are targeting cuts to keep the most productive workers. When Charles Schwab (SCHW) recently eliminated about 100 positions, it identified the positions it no longer needed rather than letting workers opt out wholesale. The company's most conspicuous old hand, Chairman Charles Schwab, 72, wasn't among those urged out the door.

Similarly, involuntary cuts are planned at a broad range of companies. Among them are Alcoa (AA), which is cutting some 13,500 jobs, Advanced Micro Devices (AMD) (900 jobs, plus some 200 cut in a divestiture or through attrition), and WellPoint (WLP) (some 1,500 jobs, including 900 unfilled positions). Typically, says outplacement expert John Challenger of Challenger, Gray & Christmas, companies move to such involuntary cuts "as a recession wears on" and they find they remain in trouble. He expects to see the numbers of involuntary cuts climb.

Even when they offer voluntary buyouts, companies typically reserve the right to say no. Walgreen (WAG), for instance, is now offering a voluntary program as it tries to cut 1,000 jobs from its 11,000-person corporate and field manager workforce—but a spokesman pointedly says management will decide which of those who apply for the buyout will get it. If Walgreen doesn't generate 1,000 departures, it will move into a targeted involuntary program. Often, adds outplacement expert Challenger, "companies will go to their best people and say: 'We don't want you to go.'"

Separately, Walgreen, which employs about 237,000 overall, is continuing to work with AARP in a program designed to attract older workers for its stores. Both CVS and Walgreen want to attract and keep older workers, especially on the store floors. "They come to you with the work ethic and the customer-service skills we're looking for," says CVS executive Wing. Customers seeking direction on over-the-counter treatments for minor ailments, he adds, often find comfort in people who have "had that ache or pain." They're also seen as role models for younger workers.

SALVAGE THE KNOWLEDGE
Some companies don't have any choice but to let go of younger workers first. "First-in, last-out" rules at unionized companies, for instance, mandate such preferences. Deere (DE) is following such rules this month in announcing an indefinite layoff of some 188 staffers at its Dubuque (Iowa) plant, which builds gear for the hard-pressed construction industry.

But 172-year-old Deere, like a lot of old-line firms, is heavily populated by boomers and prizes their experience. The typical tenure at Deere tops 23 years and quite often stretches well beyond that, executives say. "The more mature a worker is and the longer the time they've spent at Deere, their knowledge goes up exponentially," says Laurie Simpson, director of team enrichment in the company's human resources department.

Experts cite practical and legal reasons to explain why this wave of layoffs has proved less harsh on older workers than prior downsizings have. "It's what we're calling 'workforce optimization,'" says Roselyn Feinsod, a consultant at Towers Perrin, the human capital advisory firm. "It's not blanket cutting across the board, but a much more thoughtful approach. It's a much more targeted approach to RIFs [reductions in force] than there was in previous eras."

Singling out high-paid, generally older, workers for trimming got plenty of companies into legal hot water for age discrimination in past years. So smart companies now know to avoid that risk, says Gerald Maatman Jr., a Chicago lawyer at the corporate labor law-oriented firm Seyfarth Shaw. Companies in survival mode, he adds, "pick the best and brightest people, those who can do more with less." That approach favors time-tested and seasoned boomers, says Maatman.

VOLATILE AGE ISSUE
Still, companies must tread carefully to avoid showing favoritism based on age. They could wind up facing reverse-discrimination suits from younger workers who feel targeted. Few companies will openly discuss any age preferences or even will release information on the age makeup of their layoffs. Caterpillar (CAT) recently offered a voluntary buyout program to its salaried and management staff, and a spokesman noted that it didn't relate to age or tenure with the company. "Basically, anyone who thought it made sense for them could take the package," spokesman Jim Dugan says.

Still, some organizations are candid about the need to keep boomers in place. Jean Jackson, vice-president for workforce planning for Baystate Health, a 10,000-employee health-care system in western Massachusetts, points to seasoned nurses who can mentor younger recruits in the operating room. When Baystate laid off 55 staffers last November, only 20 were 55 or older (and the system has since hired back nearly half of all those it let go, finding new spots for them). Says Jackson: "Our ability to keep seasoned, longtime employees for longer periods of time will be critical for us."

Joseph Weber is BusinessWeek's chief of correspondents, based in Chicago.

[guitone]

I go about my day waiting to get a call that they are downsizing the field. Sales are down, some folks are doing ok (those with low forecasts), but the old stars (no ego here) that built their territories by going out and pounding the sand and making things happen are at greater risk as we have gotten bigger dollar increased (if you do $1 and have a 5% incease it is half the increase of someone who has done $2)....so I wait and try to stimulate my customers who sit around and just agonize over the fact that their business is off. I had hopped for 5+ more years, now I want to get through this entire year..funny how our expectations and goals change so quickly. I sit and wonder what I will do at 57 or 58 if I lose my job. I know i will not be able to get the kind of money I am making now, my house if almost paid, my daughters college is more or less taken care of....but can I afford to not be working at this age? These times are very worrisome for me.

[gbacklin]

Jan 21, 2009 0:09:25 GMT -5 Ann T said:

...management referred to all of us who were laid off as "overhead." It was a way of dehumanizing us. I confronted management, in front of all of us being laid off, and they said they did it to "ensure their future." They threw us overboard like ballast or cargo off a sinking ship. I felt like the Elephant Man: "I am not overhead! I am a human being!"...

In my 30 years as a software developer I was always labelled overhead. I asked what wasn't, and was told "Simple, Sales". I replied, "What about manufacturing, and the fact that our software makes that manufacturing part work?" They replied, "So, you both are overhead, you cost us money, if it wasn't for our Sales team you would never sell anything" I replied, "If we didn't manufacture and make it run properly, you would have nothing to sell". They replied, "We can always find cheaper ways to do that work, and we will. You just don't get it, we are the ones that bring money into the company, you guys don't. You cost us money, and a lot I might add. Case closed !"

Don't get me started on this.

[RickW]

The really silly thing is, their expectations our our attitude. They want us to be 'engaged.' But every year or two, they axe a bunch more people, to 'consolidate', or 'downsize', or 'right size', or 'outsource', or 'realign'. Whatever. Hard to feel loyalty and desire to excel when you know that at the whim of someone, no matter how well you have done, you can be gone at the drop of a hat.

We got a presentation years ago from our HR department. The presenter was talking about career planning. She said we should discuss our career plans, and where we wanted to go, with our manager. I spoke up, and said, I would never tell my manager I was thinking about moving on. When she asked why, I told her that if I did that, and we had another downsizing, and my manager had to cut someone, who is he going to let go? Even if I'm a star, I'm going anyways, so he might as well cut his losses. She was shocked - "No one would do that." I told her she needed to get in touch with reality.

[omaha]

Jan 21, 2009 7:40:40 GMT -5 gbacklin said:

In my 30 years as a software developer I was always labelled overhead. I asked what wasn't, and was told "Simple, Sales". I replied, "What about manufacturing, and the fact that our software makes that manufacturing part work?" They replied, "So, you both are overhead, you cost us money, if it wasn't for our Sales team you would never sell anything" I replied, "If we didn't manufacture and make it run properly, you would have nothing to sell". They replied, "We can always find cheaper ways to do that work, and we will. You just don't get it, we are the ones that bring money into the company, you guys don't. You cost us money, and a lot I might add. Case closed !"

The sad part of that is, I agree. From a pure dollars and cents perspective, everything is an expense. Although I have bad news for the sales guys: They are an expense too. Everything you spend money on, from software to business development to manufacturing to toilet paper to staff is an expense that the market drives you to minimize.

That's the theory.

The reality is a little different. The fact is no company is better than its people. They are what make you what you are. If you treat them like "FTE's", what sort of result do you expect? Its just stupidity, not because its bad financially but because its bad business. Pure short-sightedness.

Not to toot my own horn, but I make a point every Christmas of giving each employee in my company a personal note thanking them for their service. These are not form letters...I hand write a note to each person, specifically mentioning their personal qualities that make them so special to us.

I include a bonus check too, but consistently I have people tell me they could care less about the check, and mainly value the note.

Valuing people, and telling them you value them, is not just a nice thing to do, its a good business decision. It is remarkable how much people will do for you if they know you believe in them.

[Dub]

Omaha, If I'd given it any thought, I'd have guessed that you did that. One of the things I enjoy about you is the value you clearly place on people and human issues.

But in large companies, it's all politics and FTEs. And the Gen-Xers definitely don't want the older Boomers around.

- Dub

[gbacklin]

Jan 21, 2009 10:40:34 GMT -5 RickW said:

...We got a presentation years ago from our HR department. The presenter was talking about career planning...

I chuckled when I read this. in 1987 I was with Rockwell International as an Exempt employee vs the hourly employee, we had a Career counselor come in and our manager told our entire section of cubicles to go and that it was mandatory. Well a few of the group were hourly employees, while the rest of us were exempt.

The point of the session was entitled "Your Career: Pathway to Success". As exempt employees we were given titles, MTS (Member of technical staff) I, II, and III, Manager, Vice President and President. There were many charts showing how you can advance from one level to the next and the requirements you have to achieve to do so. The thing is that the hourly employees do not have any title, so there was nothing to reflect them in the presentation.

At the end of the presentation there was the question from one of the hourly employees. They asked, "I noticed that your presentation did not address the hourly employees, and was wondering what our career path is ?" and this is the honest truth, as the presenter was later made to publicly apologize for his response. Her replied "I'm sorry, hourly people do not have a career, thus there is no path".

[Fingerplucked]

Jan 21, 2009 10:56:52 GMT -5 @omaha said:

I include a bonus check too, but consistently I have people tell me they could care less about the check, and mainly value the note.

I agree with your entire post, except for this part. I'm thinking that maybe the check's just not big enough.

[RickW]

Jeff, the bonus check helps, but the note, very much so. I make a point when someone has been good to me, done a good job, I send them an email, and copy my boss and theirs, telling them how much I appreciate it. It's bloody rare for anyone to send such a message, that they're always very happy, and willing to help even more. So what goes around, comes around.

And it just makes all our days a little brighter for a bit. Which is always a good thing.

[Ann T]

Jan 21, 2009 7:40:40 GMT -5 gbacklin said:

Jan 21, 2009 0:09:25 GMT -5 Ann T said:

...management referred to all of us who were laid off as "overhead." It was a way of dehumanizing us. I confronted management, in front of all of us being laid off, and they said they did it to "ensure their future." They threw us overboard like ballast or cargo off a sinking ship. I felt like the Elephant Man: "I am not overhead! I am a human being!"...

In my 30 years as a software developer I was always labelled overhead. I asked what wasn't, and was told "Simple, Sales". I replied, "What about manufacturing, and the fact that our software makes that manufacturing part work?" They replied, "So, you both are overhead, you cost us money, if it wasn't for our Sales team you would never sell anything" I replied, "If we didn't manufacture and make it run properly, you would have nothing to sell". They replied, "We can always find cheaper ways to do that work, and we will. You just don't get it, we are the ones that bring money into the company, you guys don't. You cost us money, and a lot I might add. Case closed !"

Don't get me started on this.

Oh, boy, that's just the essence of what we were told, too. The attractive female sales staff loved to parade around in their Evan Picone suits and high heels, showing slight cleavage, in full make-up, talking about long sales lunches they had at nice restaurants with the customers, all gotten to in nice company-paid cars. Meanwhile, Ol' Overhead here sat and munched her brown-bagged cold turkey sandwich, apple, and Oreos in the break room.