Conecuh Software — Spidey Sense 101 – Predicting and Preparing for Layoffs

Spidey Sense 101 – Predicting and Preparing for Layoffs

On February 12, 2008 · 3 Comments

How to predict and prepare for layoffs
(Originally prepared for BALU Barcamp/LUGFest ’07)

What?

This post deals with identifying the organizational behaviors that *may* lead to layoffs. This post may be a wake up call for some. Hopefully, most in the audience will breath a sigh of relief that their current employer doesn’t have these traits.

These traits were observed from within the development / IT arm of various companies, so that is the point of view expressed. Many of the items below are valid regardless of the size or ownership of the company. I’ve just observed them in these contexts.

Small Public Company

Feature creep: Product features continue to grow, even as you’re trying to get to deployment. This generally stems from a deep seated feeling of inadequacy in management. Features are added in hopes that a product without much of a chance will pull through.
Theory over Practice: Less credence is given to pragmatic practices than is given to more “pure” practices. Speed to market is sacrificed, and the only benefit is structure that the customers will never see.
Contractors have “core” knowledge: All organizations must use contract labor these days. A good sign that problems lie ahead is when this is taken to the extreme, and the core business knowledge lies mostly with contractors.
An organization that’s resistant to change: Organizations engaging in product development these days must embrace change. Decisions *must* be re-evaluated (within reason) occasionally. New models of management are required to attract and motivate the fresh ideas required to capture market share.
“Updating the DR plan”: Be wary when the boss asks you for all of the passwords you know, because they’re “Updating the DR plan” to ensure compliance. It’s probably too late to start saving money, but certainly an indicator to update your resume
No Conferences: A good sign the company is having financial difficulties is the reluctance to send anyone for professional development. Usually the main reason against it is an even bigger sign – “We can’t spare anyone for that long”. Asking for professional development is also a good way to test the waters.

Large Private Company

Radical growth in personnel (mostly contract) for a new project: As mentioned earlier, feature creep requires more bodies, which ends up producing lower quality code, and increasing maintenance, needing more bodies, etc…
Customer “Partnerships”: Translation: “The customers won’t spend real money, so we’re trying to get them to spend man hours implementing our stuff, then they’ll have to spend money next year”
High profile customers simply vanish: Be wary when names of customers you heard in every meeting last month are not even mentioned this month.
Lots of new contractors and vendors: Contractors and vendors won’t tell the teacher if you’re cheating on the test. Are all of the new contracting companies new? If so, why did the ones you’ve done business with before decide they couldn’t help you? Most contracting companies pull from the same pool of developers, but the ones you’ve had relationships with should have developers that at least know the ropes in your company.
Security guards show up: When there are security guards at all of the entrances, and there haven’t been any bomb threats, it’s a good sign that downsizing is around the corner
New badge readers and security turnstiles: If the main entrance now looks like you’re entering Folsom Prison for no apparent reason, ask your co-workers for any money you’ve loaned them
New boss you’ve never met: When there’s a new boss, and he’s not interested in meeting and knowing everyone personally, watch your back. It’s much easier to fire someone you don’t know, than it is to fire someone you do.

Large Public Company

Acquisition: When one company buys another, most times they’re counting on some payroll savings to make the quarterly numbers. Sure, there may be talk of “synergy”, but they’re also looking to cut the payroll.
“Change of Control” Notice: This is a fancy term for “We’re about to do something drastic, but we’ve got to let our $%&*$ investors know”
Stock price goes up, but you don’t know why: Usually, the people in the trenches have a general idea when the company is making lots of money. If the people in the trenches wonder why the stock is going up, it’s probably a good time to turn your company stock into cash, as all of that new “revenue” might just be an apparition

But, it will never happen to me!

Technical prowess is seldom the selection criteria for who stays in the saucer section
Politics (duh!)
Salary (remember that big raise last year?)
Region
Duplication of function with someone in the acquiring company
Stay on good terms with the customers: Your customers (especially if you’re a software organization) can insure your employment with a complimentary E-Mail to management. The opposite applies too.

How do I protect myself?

Diversify: It’s dangerous to have friends at only one company. Most jobs are not advertised, and an internal recommendation is frequently the deciding factor when hiring.
Network: Join technical organizations, and go to the meetings. You’ll learn stuff and meet people.
This is not marriage: You’re not married to your employer. Most states are “at will” employment states, so either party can call it quits at any time. Side projects are not adultery, feel free to experiment where ever you can. Make sure those pesky agreements you signed pre-employment don’t lay claim to all of your thoughts, both in and out of work, though.
Save some money: I know it’s hard to put money back, but it’s much harder to get by when you have no paycheck. Be prepared to live (leaner, but still live) 3-6 months without a job
Draw a hard, black line: Keep work stuff at work, and personal stuff at home. If you end up unemployed, you’ll be able to rest assured that there’s nothing on your work laptop that you need.