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Understanding Corporate Jargon
Level 1 - NGMI
Welcome Avatar! Now that everyone who reads this side of the web is intelligent enough to recognize that layoffs are coming, we got a ton of questions about “how to tell”. Just because you play the politics game + perform doesn’t mean you’re 100% in the clear. There are always exceptions. So. We’ll go through the basics to determine the chances of surviving the layoffs.
Part 1 - Clearest Signs
We’ll go with the lowest handing fruit. The obvious signs that someone is on the chopping block.
Follow the Work! The clearest sign of a layoff is this: “Getting no new material work”. Since every industry is different we can’t speak for all of them. On Wall street it is easy. If there are four investment banking associates and two of them are being put on the live deals (IE. money on the line) and the other two are being forced to make pitch books… You already know that the people on the live deals are not going to get fired. It’s clear as day. You don’t want to email the CEO of the company and tell him “yeah Kevin got laid off even though he was emailing you every day for the past three months”. You’re announcing to the firm that you don’t care about the live deal! Big no.
Follow the Money! For those in other professions such as sales, run the numbers on your performance. The business unit performance. And. The team performance. This is going to give you the best big picture view of the standing. If you are supposed to bring in $1M in revenue and bring in $950,000, you’re probably okay. This is because most numbers will be going down year over year.
Now. If you were supposed to bring in $1M, you bring in $900K and are *PAID* already (base salary) as if you brought in $1M… You’re in trouble. As a general rule, try to calculate the operating profit margin of you and your business unit. If it’s better than the company margins you’re safe. If it is below (or worse a cost center like marketing), you’re in trouble.
Sudden Decrease in Work: While everything slows down when we enter into a recession, do a quick calculation on how much you’re being asked to do versus your peers. If your workload is slowly coming off vs. the group it means you are becoming redundant. This is just as important as being on “important tasks”. If you notice that responsibility levels are flat lining or going down, that’s not good.
Conclusion: Most obvious big three signs are 1) type of work, 2) if you are making the firm money and 3) if you have a sudden negative change in work flow - ie. being given less and less stuff. #3 sounds like #1 but it isn’t. If you are no longer on emails with the “important people” (every single firm has a separate BCC email group for the winners), that’s not good.
Part 2 - More Qualitative Analysis
The first section should be easy to apply to all industries in five minutes or less. The second section requires social intelligence and basic understanding of pecking order.
Who Likes Who: If you need to guess, you’re in trouble already. You should know who matters at the firm and why. You should also know if they like you or not. If the biggest revenue generator at the firm likes you, you’re unlikely going to be cut because Stacey in HR doesn’t like you. Stacey is just there to keep diversity quotas up and keep the “brand name” alive. The real decision is made by the revenue generator.
Create a simple Tree diagram. Who is on top, who is on the bottom. Figure out what percent are positive versus negative on you. A chunk of people will always dislike you. It’s up to you to determine if they matter or not. Generally speaking, in downturns, performance matters a lot more than random HR opinions. Most on the internet like to overstate the importance of HR. The real world is a lot more cut throat.
Example Tree Diagram Below
Headcount by Office: If you are still unsure, go and look at headcount by office. If your firm has five offices with the HQ in Chicago, you can be certain that *more* cuts will happen outside of Chicago on a *percentage* basis. Read that carefully. While the HQ likely has the higher number of total job losses, on a percentage basis it will be hit less than the smaller offices. If you need it spelled out anymore… Yes you better go back to the office if they tell you to. Otherwise it’s another easy excuse to cut you loose.
How Incentivized is Management? You’d be surprised. A ton of high-level managers don’t actually care if a division does well or not. You’d think we’re kidding but we’re not. Take a simple example of Lazy John. Lazy John is up for a major promotion this year and if he gets it, he won’t be involved with the division anymore. What should he do? Should he A) run it correctly so it is handed over in good shape or B) run it to look perfect the last year he is in charge. The answer is B. If he can secure the promotion and hand over the division to a new person (while it’s now thoroughly messed up), he really doesn’t care much. Sure maybe the major company takes a small hit, but he won’t be blamed for the failure of the division. The new guy is the fall guy.
No Department is “Safe”: During a large layoff even if your division is performing well it is likely that there are bad employees within the department. While it is true that the top performing ones get hit the least, if there is a 10% headcount reduction the good departments will be down 5% while the bad ones down 20% (making a simple example).
Conclusion: 1) figure out who likes you and their weight in the company, 2) look at headcount by office, 3) figure out what the department head is incentivized to do personally and 4) always remember that you’re replaceable even if you’re doing a great job. A good company wants employees to be replaceable otherwise they have huge business issues (key man risk isn’t good).
Part 3 - Now the Fun Stuff - Jargon
If the above isn’t enough here is a bunch of jargon to help you understand what is really being communicated.
“We’re a family” - You have an extremely high chance of being cut
“I view our relationship as a partnership more than anything else” - You have an extremely high chance of being cut
"Lets go out to Lunch” - You will be down big but not getting fired
“(here is all this new harder work you’ve never seen before")” - Trying to see if you’re good enough for a promotion
“We need you to come to XYZ event next week” - Trying to see if you’re checked out mentally or not. If you show up you’re in the clear
“What do you think about so and so” - Usually means “so and so” is about to be fired so try to stay neutral but take note that so and so is definitely on the chopping block
“Conference Room Invite” - Definitely being cut
“We’re gaining market share” - The division is down but they want to keep morale up
“Restructuring” - Big long-term layoffs that causes the firm to make huge changes
“Everyone submit expense reports now!” - Finalizing who is being cut
“Travel restriction for non-essentials” - You get to figure out if you’re essential or not. If you’re allowed to travel you’re quite valuable
“One team one dream!” - You better make me money or else you’re out.
We’re sure we missed some good ones but that’s enough of a start to help you decide where people sit within an organization. As a note anyone who says “thanks bud” or “buddy” is definitely not your friend. This is another common saying amongst the largest sociopaths within any firm.
On that note. No. Co-workers are never your friends.
Part 4 - Bonus on Not Being Redacted
In the end, the career game is no different than poker. The goal is to get as close as you can to the final table since all the earnings depend on how much *responsibility* you have. If you decide to quit your current position to jump to a new firm with a 10% raise you are likely a fool. The only reason to jump is as follows: 1) you know you won’t be promoted at your firm, 2) you will be given a hard written guarantee for income and 3) you will be given a promotion/major responsibility change.
Many people make the foolish choice of jumping from firm to firm at the exact same responsibility level. If you were an associate for 2 years and keep jumping (as an associate) for the next 5-years it could very well be a dead career for you at that point. No one will take you seriously as you were in the same role for 7+ years and never got promoted once.
In short, recessions = biggest chance to get promoted since people need to “step up and fill big shoes”. If your strategy is to jump to a safer firm (for no other reason) you will likely pay a massive bill for that decision (6+ figures in lost income in a short period of time).
Keeping the comments closed since our Q&A is running and don’t want redundant comments. Back to normal next week.
Disclaimer: None of this is to be deemed legal or financial advice of any kind. These are *opinions* written by an anonymous group of Ex-Wall Street Tech Bankers and software engineers who moved into affiliate marketing and e-commerce. We’re an advisor for Synapse Protocol and on the JPEG team.