Layoff Letters, Not Love Letters
It is suddenly stylish to send notification letters or emails to employees outlining plans for reductions in force, layoffs, RIFs, or "right-sizing". Here is the text (or links) to a few examples of such employer "Love Letters" from General Motors, Mahalo, AOL, and Yahoo.
US Based GM Executives -
As you know, we are in the final stages of the consideration period for the 2008 Salaried Retirement Window. Our results to date are good, having received more acceptances than we initially predicted. Unfortunately, business conditions have deteriorated since the program was initiated. The global credit crisis has had a dramatic impact upon the industry at large and new vehicle markets in North America and Western Europe have contracted severely. The global economic outlook remains very concerning. As a result, actions are being taken throughout GM's global operations to address our increasing need to conserve cash. Here in the US, we need to reduce our salaried and contract workforce by even more than we anticipated. In this regard, we expect to initiate involuntary separations in some areas of the business, late this year and early in 2009. Additional changes in active salaried employee benefits also will be announced in a Total Compensation Journal to be released today. These will include suspension of the stock savings match as well as suspension of other reimbursement programs. We regret needing to take these actions, but they are necessary based upon current business conditions.
It is important for those who are still considering a retirement window offering to be aware of these changes. This may be an ideal time for them to exit the organization under provisions that are generally regarded as very positive by those who have already gone through the process of consideration.
As always, your continued support and leadership are truly valued during these difficult times.
Rick Wagoner Fritz Henderson
source: Wall Street Journal
Mahalo Layoff Letter
Given the challenging economic environment, we’ve decided to make some pre-preemptive cuts at Mahalo.
Balance of this letter can be found here.
AOL Layoff Letter (circa 2007)
Dear AOL colleague,
Just over a year ago, AOL embarked on an incredibly complex and significant transformation as we fundamentally shifted our business model from a subscription-based ISP to an advertising-supported Web company.
Today, I want to give you an update on where we are in this transition, and talk about further actions we’re taking and where we’re headed as a company.
When I came to AOL, I knew we had to take several steps to complete our company’s transformation.
We aggressively expanded our advertising capabilities, building on the strength of Advertising.com and our premium ad sales force. We acquired three leading-edge advertising companies–ADTECH, Third Screen Media and TACODA–and formed Platform-A. AOL now has one of the largest and most sophisticated ad networks in the world, and we’re well positioned to compete where the ad market is heading.
We rebuilt and revitalized our key products, programming channels and platforms. And unique visitors to AOL.com, News, Food, Money & Finance, TMZ, Moviefone, MapQuest and many other sites are up. Our products are once again creating buzz in the market. And to reach the widest audience possible across the Web, we’re unbundling our products and programming so users can take them along wherever they go online.
Importantly, we’re taking the business global. We’re extending AOL’s reach into seven new countries this year while globalizing our product development efforts. By the end of next year, AOL will have a presence in 30 countries. That’s a remarkable achievement in a relatively short period of time.
We refocused the business around three core areas–Platform-A, Publishing and Access–and are now managing these as three distinct but related components.
Here’s why this is important. With Platform-A, we can offer advertisers the most advanced set of solutions across our extensive network of owned-and-operated sites and third-party sites. Publishing provides us the products, programming and platforms we need to sustain a healthy owned-and-operated network. And our Access business continues to be profitable, providing us cash flow to invest in other areas of the business, and it’s an important source of primary emails and page views.
The last important piece in this transition is the realignment of our costs against these three businesses so we can operate as efficiently and effectively as possible. This is in many ways the most difficult step, but a necessary one.
As a part of this realignment, tomorrow we begin a reduction in force that will, over the next couple of months, affect a total of about 2,000 people out of our worldwide workforce of 10,000.
Everyone impacted by this reduction deserves our thanks and respect for their contributions to the company. We will aid these individuals in their transition to new opportunities as much as possible, most importantly with what we believe are generous severance packages.
This realignment will allow us to increase investment in high-growth areas of the company–as an example, we added hundreds of people this year through acquisitions–while scaling back in areas with less growth potential or those that aren’t core to our business, as we did with the sale of Tegic.
So where is this taking AOL? Put simply, my vision for AOL is to build the largest and most sophisticated global advertising network while we grow the size and engagement of our worldwide audience.
We’re only a year and a month into our transformation, and the turnaround has been dramatic. We’re now in a position to win as an advertising-supported business. We have a bright future as a company if we can execute on this vision.
Yahoo Email - Jerry Yang
i feel it's important for me to reach out to you after our earnings announcement, and before our all hands meeting tomorrow.
we as a company have been through a tremendously challenging year; and managing the increasingly turbulent global advertising climate has been an important focus for the last three months.
throughout the first three quarters of 2008, we have been balancing between investing in our top priorities, and managing our cost structure. beginning in september, with the help of Bain & Co., we initiated a series of steps to determine how we can become more efficient and productive as an organization.
we heard from you through the YEES survey, and through your suggestions on backyard, and we've identified many areas that we all feel we can improve upon. our productivity efforts, based in part on what we heard from you, will involve initiatives such as streamlining our organizational structure through reducing layers and increasing spans of control, and eliminating redundancies. longer term structural efficiencies include consolidating facilities, improving procurement, and standardizing our global technology platforms.
today as part of our q3 earnings release, we said that our goal is to reduce our current annualized cost run rate of roughly $3.9 billion by more than $400 million before the end of 2008. we are targeting non-headcount expenses wherever possible, such as facilities and outside services. however, because compensation expenses are the single largest part of our costs, we anticipate a reduction of at least 10% of our global workforce by year-end.
affected employees will be notified of layoffs in the next several weeks. we understand that hearing this news now creates uncertainty, but we are moving ahead in a way that balances speed with a clear focus on accomplishing what is necessary to set the organization up for long term success. going forward it will continue to be important for us to make the right decisions to keep our business efficient and strong.
having layoffs is very difficult, particularly in light of all we've experienced this year. but we don't take these decisions lightly, and are committed to treating affected employees fairly, offering severance and outplacement services.
the steps we are taking are not easy for us as a company, but as we become more fit as an organization, decision-making will be faster and it will be easier for us all to get more done and stay focused on our strategy. these changes will also prepare us to better deal with the macroeconomic downturn. as with previous downturns, yahoo! continues to be a place where consumers turn for information and communications, and is an integral part of their internet day. as the global economy improves in the future, i certainly believe that we will be stronger and benefit from the actions we are taking now.
as always, i thank you for all you do as yahoos.