COVID revealed how vulnerable lean/JIT inventory processes were to supply-chain perturbations...how unexpectedly difficult recovery from such disruptions can be...and how essential planned redundancy is. Looking at the waves of layoffs rippling through the agency sector just now, I wonder when our industry will learn the same lesson about lean/JIT staffing.

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What lesson is that?

Sadly, most public holding companies won’t learn the lesson. Just like most public ad tech companies, executive leadership prioritizes layoffs in the short term to please investors for a nominal upward shift or stabilization in stock price. This leads public agencies unprepared to staff up quickly when there is a turnaround. Large tech companies like Google, Meta can staff up quickly because they have higher compensation and have the resources to pivot to ramping up hiring.

What sparked this thought was a recent round of layoffs across entire capabilities (not just one or two accounts) prompted not by any significant business loss but by a corporate mandate to fatten up margins (to please investors, obviously). As the company was motivated to achieve these improvements quickly, jettisoning senior people (whose value lay not primarily in their transactional allocation to a particular account but in their expertise, judgment, and institutional memory) was the quickest way to do that. Replacing those people will not be as simple as finding another supplier for ball bearings...hence my reflection on recent global supply-chain disruptions.

Agencies who treat senior talent so lightly are actively advancing their own commodification.

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