Tech Layoffs Offer Opportunity to Embrace Future Forward Business Practices
MBO Partners
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It's been a tough few weeks for the tech sector, with now near-daily news of staff cuts, hiring freezes, and layoffs. Notably, Meta CEO Mark Zuckerberg recently asked employees to brace for a rough back half of 2022 . For Meta, this means 30-40% reductions in planned hiring and even potential staff reductions, although this is being framed as "turning up the heat a little bit" and "raising expectations" instead of formal layoffs.
Other organizations have followed suit , with major layoffs at companies like InVision, Mural, OpenSea, Hopin, Twitter, and more.
In the interest of staying on top of trends, we chatted with Vice President, Enterprise Solutions and Technology Vertical Lead Cori McKee to get a bit of insight about what she's hearing from the market at large. McKee confirms hiring freezes are now 'standard practice' at nearly every organization she speaks with, and that cost containment measures are aggressively in place through year end.
With that in mind, forward-thinking organizations are better prepared than most. McKee offered three actionable tips.
First, Admit the Problem
The first step to recovery is admitting you have a problem. Economic uncertainty is here to stay, at least for the foreseeable future. Add to this high inflation and additional instability from the current health and geopolitical climate and you've got a perfect storm.
The most prepared organizations are those that have declared a corporate policy towards hiring or current challenges and are enabling managers to work proactively to solve critical business challenges. This may include leveraging independent talent to boost utilization, enabling contract engagement on key strategic roles, and more.
Look Beyond the Now
The "R" word is scary, and even if we're not in a full-on recession, this problem is far from temporary. Savvy firms must look beyond the next quarter or even the next year and consider hiring plans that scale with a long-term lens.
This involves a careful look at roadmaps and a match of key skills to projects. The most strategic firms are articulating not just a philosophy of workforce optimization, but actionable steps to form pools of known talent and ongoing, nurtured relationships with independent professionals, so that when firms are ready engage, talent are not only ready to get to work, but that the company remains top of mind as a "Client of Choice" as well.
Last, Know Your Market
When organizations have pools of specialized talent, they can easily articulate where they will use independents vs. FTEs to fill key projects. While it is certainly possible to skill up or source a resource for a specific need, the most structured firms know what specific project roles will likely be needed, and plan accordingly. In the technology sector, the most in-demand roles range from specific development modalities to change management, IT program and project managers to sales consultants, McKee says. Consultants remain particularly in-demand, because unlike employees, their utilization rates are 100%, meaning they only bill for what they work.
The adoption and optimization of a blended workforce could provide more advantages to businesses, especially during these turbulent times. As a possible recession is still in the minds of economists and business leaders, a blended workforce allows organizations to scale up and down without creating long-term commitment to their workforce. Furthermore, as the Great Realization persists, transferring full-time workers to freelancers, the talent pool available for on-demand projects becomes much larger.
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Want to know more? We shared some additional insights over on our blog last week:
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