Thread regarding Dell Inc. layoffs

It might not be personal. They might have followed some mathematical model leading to selection (that also didn't have inherent bias). Generally speaking more than likely it was personal in the sense that within the group or team there was a charge to give 'x' head(s). Then the more senior leaders selected whomever and the selection was put in the context of the greater layoff picture to make sure the overall mosaic wasn't discriminatory. If all went as it should (from the company's perspective) the business was able to release those it most wanted to and the action survived the sniff test re:discrimination.

@cyb+16ZPX9wT exactly

We are not selling enough of what people want and we have too many staff to do it with. Cost savings need to be made. If you have been here a while you would have seen this coming a LONG time ago, hiring thousands of specialists on specialists, tripping over each other with huge teams.

Was with Dell for ten years, left to start my own company.

Let me give you an insight into how business leaders think about their problems.

Pulling from Dell's latest 10-K....

Net income for Dell Technologies for the six months ending August 2 2019
$3.7B (8.2% of revenue)

Net income for Dell Technologies for the six months ending July 31 2020
$1.19B (2.7% of revenue)

Not good. It's been argued that net income is the only measurement of a business that matters. If their profitability stays on that trajectory, Dell goes into negative net income territory, causing all sorts of problems...

Now, in an environment where sales are down, component costs are up, and the future is uncertain, what lever can a business leader pull to increase net income?

You have to cut operating expenses...

SG&A (selling, general, and administrative costs) at Dell have been tracking to a little over 23% of revenue (last quarter, $4.76B) That's not unprecedented for a manufacturer, but it's highish. R&D costs, which Dell observes are mostly compensation based, are around 5% of revenue ($1.25B last quarter).

If you look at Dell Tech operating expenses (SG&A + R&D) for first half of the years ending Aug 2 2019 and July 31 2020, here's what you see.

1st half 2019 = $13.054B
1st half 2020 = $12.171B
Difference = $883M

So the good news is that Dell has, quietly, cut operating expenses by $883M over the past year, and if you read the 10-K, you'll see, spelled out, all the ways they've done it.

The bad news is that, For the first half of 2020, more than 70% of the Operating Income Dell reported was a result of driving down operating expenses.

Compensation is a massive operating expense.

If they could have driven an additional 10% reduction to SG&A and R&D costs, they could have added $1.2B to the net income number.

So Dell has to fix net income. How? Cut compensation by downsizing.

And it is literally that straightforward. Dell Technologies cannot continue on its current trajectory without cutting operating expenses, including programs, services, marketing, and employee compensation.

So you're right, it isn't personal. It's an exercise aimed at the continuation of the company. Yes, it hurts people. I was downsized 20 years ago and it really hurt. But if Dell goes into negative net income territory and stays there, they would either be forced to take much more drastic measures...or close the doors.

What a flawed logic. You bail out companies, and companies lay-off and ship jobs. How would a 40 something or a 50 something find a job in this market. This is modern day slavery and a lot of ppl in the US vote for it!

I’m EMEA based and I know if I every get let go, my severance would be def over 1yr worth of pay plus I don’t have to worry about healthcare... u know what that does? It’s not socialism it’s actually capitalism at its finest bc my severance and my healthcare will ensure that I continue to contribute to the economy by consuming, and providing a value. I won’t even go into govt programs that re-train the population with new skills. In the US you just want to empower corporations against individuals and make the rich richer!

I was laid off over 2 years ago (legacy EMC Storage). Being above 50, I insisted on Dell providing me the list of those being laid off in MA and they did. While you couldn't prove the age discrimination, you simply knew Dell was replacing older and higher paid workers with kids out of school with no experience with MBA's at 1/3 the salary. They are skilled at avoiding the government WARN regulation notifications by slowly exiting workers month after month, but keeping those numbers under the government requirement. When I asked if I had to abide by my non-compete, HR had to get back to me and told me yes. My thoughts was f'ck them. They got rid of me. I simply didn't update my LinkedIn profile.

Yes, it's a numbers game and you can't take it personal but when you work with those long-timers who are cozy at their job, showing up at 10am, hitting the gym for 2 hours and then leaving at 3 to go home, you wonder WTF.

For me, Dell's decision to cut me was the best thing ever. I landed a job in less than 2 months. Got a $30,000 raise, unlimited vacation policy and work from home. Today I work for a $50B+ global organization and interact with the highest levels of our organization because they appreciate my experience and industry knowledge. Good luck in your next gig.

It is BS!

"It's just business" has been an excuse to do terrible things for thousands of years. If you think that sort of reasoning justifies what large corporations do, you are part of the problem.

Yeah its not personal until it happens to you.

Nope Im not from HR and as mentioned this is my third redundancy. There are people around me under 30 that are getting made redundant, age and placement doesnt matter. The statistical significance of how much you are being paid may come into it and that may be why the number is sku'd to older people but that's the maths side of it.

Vacation leave . . thats another thing. Im not an employment specialist but that needs to be paid.

In MA, we have age discrimination laws where the company must show you the age distribution of the folks let go. A friend at another company was given such a list before he agreed to the seperation. We will see how it goes with this rif.

Sounds like that’s written by Dell HR.

#1. I bet you still have your job and you will write slightly different if you were the one laid off.
#2. No one is saying it is personal. Dell has to do what is good for Dell. If it is my company, I would do the same too. That is capitalism. But even in capitalism, you are supposed to follow laws in the book. They are clearly breaking immigration laws. They are for sure breaking age discrimination laws. They are probably breaking race discrimination laws. They are being petty and unethical by not paying earned vacations. Folks who gave up peaceful family life and stepped up during the pandemic are now being told, you are fired and you can’t take your vacation or get equivalent pay.
I hope you understand what we say.

I agree with everything you said. But, it is somewhat personal. At some point, the manager looked at the team and made a decision to choose 1 or 2 people from their team to be let go, over the others who were chosen to stay. So, it is rejection to some degree and it stings. But everything else you said is spot on and that’s how I’m choosing to respond to what happened to me. I feel fortunate to have gotten the experience and really thankful that there is severance and I actually prepared for this in advance, have a very strong skill set and diverse experience and so I’m in a good place. Still, it does sting no matter what.