No one likes layoffs, but they are a reality in the workplace.

It’s difficult to read the news (or my LinkedIn feed) without seeing an announcement of layoffs. Companies often use terms like “reorg” or “pivoting” to explain layoffs, indicating efforts to invest in new or growing business models.

Years ago, I saw this firsthand when a global retailer I worked for laid off hundreds of my co-workers. The company shifted from expanding retail stores to investing in its B2B and eCommerce initiatives.

The Lifespan of a Company

While the human lifespan has been increasing, the lifespan of companies is not. Startups aim to get acquired, while other companies either fail or get acquired. Then, a new startup takes its place, and the cycle restarts. Some studies suggest that the average lifespan of all U.S. companies (both public and private) is less than 10 years. Ten years ago, companies in different industries like Washington Mutual, Sprint, and Sears were top F500 companies. Employers and employees should enter into this mutual agreement with their eyes open to this reality.

High-growth companies, regardless of their size, and their leaders know the corporate lifespan. They focus on hiring top talent for key initiatives. Prioritization is the key for these companies to not only survive but thrive.

Planting Here, Pruning There

It is becoming increasingly difficult for company leaders to know which disruptive changes to prioritize. But they must prioritize. Leaders take action and are proactive. They make quick, informed decisions, constantly reviewing their talent and making changes to maintain their competitive advantage.

For example, when Satya Nadella became CEO of Microsoft in 2014, he prioritized the growth of Microsoft’s cloud platform, Azure. This required significant hiring for cloud-related roles, including engineers, developers, and sales specialists. By expanding its talent pool in cloud computing, Microsoft successfully grew Azure into a leading cloud platform, significantly increasing the company’s revenue and market presence.

Similarly, Howard Schultz, the former CEO of Starbucks, navigated the company through the 2008 financial crisis by making significant changes to its business model. Schultz temporarily closed over 7,000 U.S. stores to retrain baristas on the art of making espresso and focused on improving the customer experience.

That Was Then; How About Now?

The 2024 AlixPartners annual Disruption Index surveyed 3,000 executives about their growth and profitability. The survey found that the top 8% (249 of 3,000) of self-rated growth and profit were unafraid of big change. It noted that “uncertainty is not the same as risk. Risk is calculable; it can be expressed in terms of odds. Uncertainty is incalculable. A game of roulette is risky but not uncertain.”

People frequently ask Jeff Bezos about the future of the work landscape and Amazon. He suggests people should instead ask, “What is NOT going to change in the future?” He cannot imagine a future where people don’t want fast shipping and low prices. He says the true secret to business success is to focus on the things that won’t change, not the things that will.

Ready to Prioritize?

According to Layoffs.fyi, as of August 2024, 124,517 employees have been laid off in 384 tech companies. Additionally, countless talented individuals are on the lookout for new opportunities.

Now is the right time to make that pivotal move for your team!

Your company’s life may depend on it.

by Ruben Garcia