Rising Star
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Chief
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Enthusiast
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Happy friday ya'll
Increasingly difficult to hold on to both....
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!!!paging accenture!!!
lmao
accenture MDs: iTs nOt a LayOff
I remember - good ole 2019-2020
Entirely possible his friends were just under performers. It’s up or out not a guaranteed job for life. And when voluntary attrition drops involuntary attrition rises it’s how all our models work.
Chief
It’s not up or out. Most consulting firms don’t do that.
But adjusting forecasts and firing a few extra low performers isn’t layoffs.
Chief
Many firms expect a certain amount of attrition every year from all factors. Let’s say it’s 15% for sake of conversation. In good economic years, maybe 10% leave for new jobs and 5% get pushed out for performance. In a leaner year, only 5% are leaving, so the push out bar gets raised to include the bottom 10%. Attrition rate stays the same, but how/why people leave changes.
Chief
EY did this back in 2020
Where? I haven’t seen any in my group at least.
Layoff means you could be a great performer, but your job was cut entirely and will not be backfilled. These people your referencing all received negative marks and were not meeting expectations. Should companies keep everyone around with no penalties, and we lower all salaries and bonuses to compensate?
Nah, low performers are definitely the first to get laid off during real layoffs too. They will say the position won't be backfilled, but that could just be a period of 1 day.
Chief
Your friend just figured out the facts of life
Did your friend just try to rename up or out?
Chief
I think this discussion definitely gets weighted down by terminology so let me try and speak to the through lines:
Yes - some firms lean more heavily on performance system to lower headcount during times of economic uncertainty
Yes- some firms will eliminate roles entirely without much personal performance pretext in times of economic uncertainty.
Regardless of which camp you sit in it’s unfortunate for the individual
The performance bar moves and it’s often a higher hurdle when things get uncertain. But healthy firms do that every once in a while to clear out low performers or people who aren’t really engaged any more.
Creates new spaces for new people.
Rising Star
Interesting discussions! Personally I agree that these aren’t really layoffs, since layoffs usually target entire divisions and don’t typically factor in individual performance.
I don’t think it’s as simple as “up or out” since there’s clearly a sliding bar that depends on environmental factors.
I’d call this something like an “economic PIP” where the macroeconomic environment requires better performance to keep your job.
That’s not a layoff. Layoffs are by definition not about performance
Layoffs or reductions in force occur to reduce the fundamental cost structure of a firm by reducing headcount in a single event.
Attrition is actively managing your talent pool to ensure low performers and skill gaps are addressed through firing and hiring