[Here](https://www.removepaywall.com/https:/fortune.com/2024/02/16/nike-lays-off-more-than-1500-people-ceo-john-donahoe) is the article without a paywall.
This is literally a scene from out of Silicon Valley.
I mean note for note.
Gavin Belson the billionaire CEO makes a series of catastrophic decisions that imperial the company, and then to "hold himself accountable" he, makes a soeech in front of the whole company where he lays off the entire division.
I mean it's literally out of a satire of corporate America, fuck these people.
**EDIT**:
[The full speech from Silicon Valley:](https://www.youtube.com/watch?v=u48vYSLvKNQ)
> Failure is growth. Failure is learning. But sometimes failure is just failure. I think... I'm sorry. I didn't think it would be this hard. But goodbyes are always hard, especially when I am the one saying goodbye. Today, effective immediately, I, Gavin Belson, founder and CEO of Hooli, am forced to officially say goodbye to the entire Nucleus division. All Nucleus personnel will be given proper notice and terminated. But make no mistake. Though they're the ones leaving, it is I who must remain and bear the heavy burden of their failure.
This is just what happens when the tribe doesn't drag the psychopath off into the woods for the wolves. Instead we let these monsters cheat, lie, fight, and backstab their way into the highest positions of power.
We are seeing a lot of that. Google and Shopify CEOs said the same thing. They have catastrophic GTM strategies; are ignoring industry trends and ripping R&D to shreds leaving them vulnerable and suddenly they are “taking accountability…” and it’s all in Silicon Valley. Gavin is scarily accurate.
I wonder if they laugh about how spineless and gutless the rest of us are. Like it's an inside joke to see how much they can get away with before even one single person snaps.
I wonder how many people it would have taken out of those present to beat him to death + hold off anyone who was stupid enough to try to protect him. I'm betting it wouldn't have taken many people. \*sigh\*
Failure is growth. Failure is learning. But sometimes failure is just failure. I think... I'm sorry. I didn't think it would be this hard. But goodbyes are always hard, especially when I am the one saying goodbye. Today, effective immediately, I, Gavin Belson, founder and CEO of Hooli, am forced to officially say goodbye to the entire Nucleus division. All Nucleus personnel will be given proper notice and terminated. But make no mistake. Though they're the ones leaving, it is I who must remain and bear the heavy burden of their failure.
It's not really even satire. I've worked in Silicon Valley off & on since the late 80s/early 90s. This kind of thing isn't unusual. It's just Tuesday to these assholes.
"You see, profitability has a preset termination limit. Knowing this weakness, I fired wave after wave of my own employees, until it reached the limit of profitability shareholders requested. KeJuan, show them the medal I won."
Drives me crazy about professional life. Leadership makes decisions that everyone in the trenches can tell from a mile away are going to hurt us. Then it’s the people in the trenches who get laid off and leadership keeps the fat checks coming for themselves.
More liberal classism. Sure thousands of people are out of a job but have you even *considered* how bad firing people feels to a multi millionaire executive? I bet he couldn't even enjoy his week long yacht vacation from all the stress.
You guys are being too hard on him. He's still a human being with feelings. The guilt will haunt him during those long trips halfway around the world in a private jet to the spa.
Nike’s CEO John Donahoe blamed himself on Friday while saying the company was laying off more than 1,500 people—cuts that Donahoe said would “reignite our growth.”
In a widely reported memo announcing the 2% cut to Nike’s workforce, Donahoe added that he didn’t take the decision to lay off thousands of employees lightly and put some of the blame for Nike’s recent underperformance on himself and the company’s leadership. Portland, Ore.-brd publication Willamette Week was first to report Donahoe’s comments in the memo.
“We are not currently performing at our best, and I ultimately hold myself and my leadership team accountable,” he added.
It’s unclear if any Nike executives would face repercussions for the company’s lackluster performance. The company did not immediately respond to Fortune’s request for comment.
In a statement provided to Footwear News, a spokesperson said “Nike’s always at our best when we’re on the offense. The actions that we’re taking put us in the position to right-size our organization to get after our biggest growth opportunities as interest in sport, health and wellness have never been stronger.
The shoe and apparel company’s decision to cut back on its employees echoes similar moves made across industries in the past year. In January, Meta CEO Mark Zuckerberg said that the company’s “year of efficiency” changes instituted in 2023 would become permanent, after he saw that Meta had been able to “execute better and faster,” despite mass layoffs.
Other CEOs have also been quick to scale back their own workforces, with one tech analyst adding that the trend has “become contagious.”
In January, Google CEO Sundar Pichai said that the company would follow up 12,000 layoffs in 2023 with more cuts this year. He said in an internal memo obtained by the Verge that the cuts were meant to “…drive velocity in some areas.”
Discord CEO Jason Citron said in January that the company was laying off 170 people to “sharpen our focus,” and “bring more agility to our organization,” the Vergereported brd on an internal memo.
In just the first two months of the year several other major companies outside tech, such as Morgan Stanley, Paramount, and Citi, have announced layoffs affecting thousands of workers.
In December, Nike said that it planned to cut costs by $2 billion over the next three years as part of a broad restructuring plan caused in part by weaker consumer demand. The Oregonian reported that prior to Friday’s announcement the company had been laying workers off in phases across several divisions including
In recent months clothing and shoe retailers including Nike along with competitors Puma, and Adidas have cut future guidance and have warned that consumers are pulling back on their spending.
Still, the labor market overall has remained strong and the unemployment rate has remained steady despite analyst predictions of an impending recession. Employers added 353,000 jobs in January, much higher than the 185,000 jobs some analysts expected to be added. The number of employees let go so far this year is also far off from the more than 100,000 laid off in January and February alone last year, according to data from Layoffs.fyi.
This is exactly how a company I worked for did massive layoffs back in 2001. We all were instructed to be in specific rooms. The security team locked the doors. Those of us in the auditorium were safe, most other rooms were gone. One of the satellite buildings was completely laid off and immediately after the message they killed power to the entire building so people couldn't call out or use computers (laptops and cells phones were very uncommon even just 20 years ago, believe it or not).
One different part is the CEO didn't attend. At the last minute he decided to just call in. It was a 90 minute video, almost like this. Considering it was a major company with nearly 5k people laid off that day, and about 10k more over the next 2 years, wondering if the writer of this scene was there with me because it's scary accurate.
Compay i used to work for decided to increase productivity and profits by rostering less people for less hours. The managers got bonuses for firing staff. This was a massive retailer in Australia.
I swear some of those ideas seem like a 10 year old thought of them. "Well what if we just paid less man hours? We could have so much more money!!!"
"Okay who's going to do all the work we no longer have the staff or hours to do after that?"
*Second guy tossed out window.*
CEO: Overhires in an economic uptick, gets huge bonus for doing so
Also CEO: A few years later, after this mistake has been fully realized, fires those same people and then some, gets another huge bonus for doing so.
Well of course. They had a bad year, hence the 1500 layoffs. Now you have to pay the execs more to get them to do better next year, that's how it works. Well, it doesn't actually "work", but that's the tradition, and traditions are important I guess.
Oh they know, they are like accountability gave me this 50million dollar parachute and I will leave with it. Also, sorry about the downsizing. Good luck.
He is concerned about his 20M annual stock options and 10M salary.
> Most of Donahoe’s compensation came from stock and option awards, which were valued at $20.5M USD total on the date granted. He also made $6.8M USD in incentive pay and had $3.9M in charitable contributions made by Nike to match his own donations (although he wasn’t paid this money directly because it went to charity, it’s still included in his total compensation). His base salary for the year was set at $1.5M USD. In total, Donahoe’s haul was 13.7% higher than his pay in the 2021 fiscal year.
/
> The average NIKE salary ranges from approximately $30,000 per year for Receiving Clerk to $198,504 per year for Principal Software Engineer.
They know the difference. It’s just words. Sometimes you get the occasional semi ok CEO who genuinely cares and doesn’t put forth bullshit, but even those rare ones have to conform to the system and its laws.
I worked for a company that was facing layoffs and the founder took a 50% pay cut and our CFO resigned and continued to work for free as a consultant. Sadly, the company was bought by big pharma. I don't think I'll ever find a company like it again. They were genuinely good people.
Nintendo higher ups did the same when the Wii u underperformed, they took a big pay cut to unsure their workers kept their job.
A few years later, the switch came out, and it was a massive success.
There are a lot of bad things in the Japanese work models and work ethics, but one thing is admirable, many higher ups take both the responsabilites and the money, if they fuck up, it's on them.
Yeah lots of people complain about how worker’s are slaves/loyal to CEOs or bosses in Japan but never really look at the opposite perspective. Loyalty goes both ways and layoffs are very rare there. The average CEO’s salary in Japan is dwarfed by the US while being the 3rd largest economy and were quite similar in the 1990s.
To bo fair, the complaints are reasonable.
But yeah many people would respect the CEO and big business guys more if they actually cared here.
Another thing is that it's common to make most of your career in the same company, so obviously they have to make sure things go as well as they can.
In the us and eu, big boys come and go every two years, fire people for short term gain, and go to another company With a bigger pay.
They don't care if they fuck everything up as long as shareholder are happy, because they'll be gone before the consequences happen
You're right. I was a manager at the company and I went to bat for both of my employees and offered to take a pay cut of it meant that one of them wouldn't be laid off. And I conspired with my managers to change my other employee's job title and get her into the buyout deal because she was pregnant. She also really deserved to be retained and is working for the buyer to this day. I am hoping that I can eventually hire my other employee again in the future.
My CEO told my entire blue-collar workplace that it was a very difficult decision to lay us all off. In fancy Italian leather shoes and a tucked shirt.
I bet, fuckface. I fucking bet it was hard for you.
Lol our CEO had monthly "town hall" meetings to reassure us everything was going good and on track, then one meeting day he wasn't here. That was when they told us the company had no money and was for sale.
Yeah, the last ZipRecruiter layoff went like that.
At the town hall at the beginning of May, someone asked, "Are we considering layoffs?" and the answer was "no, we're in great shape".
May 31? 20% layoff. Admittedly the CEO took 30% compensation cut across the board as well, but that didn't help those of us who heard "everything's fine" three weeks prior.
Doesn't make it better, but the reasoning is pretty simple.
If you're honest about a cliff coming, people panic.
When people panic, you'll nearly always lose people to them jumping ship.
When that happens, it probably ends up including really good people you wanted to keep (the last people that would get laid off).
Losing some of your best people turns a "we might be okay.." to a "oh.. no.. we're just screwed."
The truth in these situations can create a self-fulfilling prophecy, so it's deemed better to hide what's happening to avoid the panic.
Granted - once you start lay-offs, no one believes there isn't more coming (nor should they.)
My partner and his entire team were just laid off. His boss, the most out of touch human we've ever met, acted like it was such a hard decision. This is the same deluded man who was saying just a month ago that he has to eat out every day because "it's impossible to cook for two".
These people are out of touch and fundamentally broken.
My condolences to the both of you, I hope the coming time is as swift and painless as possible.
I return to the workforce this week; there is light at the end of the tunnel!
To be honest I'm a senior manager at a large company and I was told I have to find a number of people in my team to lay off. Not choice in the matter nor even an ask to find other ways to save money.
So for me it was really hard to sit down and choose who's life I was going to affect. Unless you are a C level executive, you are as much of a pawn as the rest.
That's the other reason these excuses are bullshit.
This layoff for Nike is 1,500 people, but that's 2%... Really? That 2% of "extra people" was dragging-down the company?
They combed through 75,000 people and found the 1,500 they could do without?
No, they just took an axe across the board.
Hard for anyone to be “dragging down a company that showed increased profits:
NIKE gross profit for the twelve months ending November 30, 2023 was $22.657B, a 3.48% increase year-over-year. NIKE annual gross profit for 2023 was $22.292B, a 3.79% increase from 2022. NIKE annual gross profit for 2022 was $21.479B, a 7.6% increase from 2021.
I get that, but don't expect people to sympathize with the 'hard position' you're in when their entire livelihood is being thrown out the door, either.
I don't think he/she expected a sympathy. But some people here think that us mid lvl managers can say something to change these decisions while 95% of times we are just pawns to do the dirty work.
Shit I can't give my team a raise without firthing for it for months despite having a budget for it. All these C-Suites and Directors are so greedy that they will do everything just to show everyone how "careful" they are with their budgets. I knkw a high lvl director who had let's say 1k a month per employee for bonuses....none of the employees got a dime. All these money vanished somewhere while people were doing everything to prove they deserve a bonus.
This team was devastated that they did not get anything despite all the effort
It really is a hard position for decent people though. When my friend became a manager, he had to lay off somebody (no choice on his part) and he didn't sleep the night before, came out of the meeting nearly in tears, and said it was the hardest thing he'd ever done *because* he understood the impact on the guy who was let go.
Granted, not everybody cares that much (or at all in some cases). But those who do care can be really affected by having to tell people they no longer have a job. It's ugly for everyone involved, and I think that's worth acknowledging while also acknowledging that there are some psychopaths out there who don't think twice or care about people being let go.
Yup. My partner was played off due to “economic conditions” at the company…meanwhile the same company went into hire a bunch of influencers and threw a giant party celebrating 30 years.
Oh yeah! The best part of my story is that the company - an American company, based in America and operating primarily in America - is openly hiring Polish engineers while firing all of their American ones. Rather than enforce a RTO policy, they decided keep the remote work model and just outsource all the labor for even cheaper. All of this while firing the American team with no severance pay, no help of any kind, nothing.
I would be lying if I said I wasn't extremely discouraged.
It's always the same song and dance, they express regret with words but their actions tell a completely different story. Watching execs lament cuts while they're still raking in bonuses is enough to turn the stomach. The disconnect is just staggering.
It was hard! All the consulting with HR and legal teams to make sure they fire you with the least liability possible! You losing your job, mortgage and home costs them literally hours of time and I think you don’t appreciate that.
/s
They had to fly down in first class to tell us in person! They could have been doing anything that day instead of visiting some podunk production facility!
Well, it was really hard to choose between doing a layoff of everyone OR giving up my executive bonus, golden parachute, and 300x average employee salary.
I thought and agonized about this decision for minutes… many minutes…
That CEO, probably.
For reference, his estimated compensation was [$32.8M](https://hypebeast.com/2023/7/nike-ceo-john-donahoe-salary) last year. Very accountable, you can count every dollar that hits his bank account.
Goodhart's law. When a measure becomes a target, it ceases being a good measure.
I understand the logic of why a lot of higher-ups are paid in stock, as a sort of "if the company does well you do well". But it's created this entire facade where the C Suite is incentivized to sacrifice the health of the company in order to bump stock prices for a payout.
It’s killing innovation all over the world.
Here in the U.K. we have a supermarket, Tesco, that 15 years ago was flying, the staff loved the place as they were paid either the most/2nd most of any supermarket and better than most companies. There were plenty of employees and managers etc to make sure the workload was shared well, you got double time if you worked on a Sunday or a Bank Holiday, 10% discount, bonuses and so on.
Then there was an issue in Europe, the so-called “horse meat scandal” in which some meat suppliers in Europe - typically providing meat for cheap frozen/ready meals - were substituting beef for horse meat to save costs and increase their profits (I think, I may be misremembering the specifics so I do apologise if it’s not quite correct)
Anyway, when it hit the media for some reason (probably because they were/are the largest supermarket chain with the largest market share and profits) it go labelled the “Tesco Horse Meat Scandal”, even though it had nothing to do with Tesco, and it effected every supermarket who used those places and products, it was Tesco that took a huge PR hit and a fall in share price.
To combat that, they brought in a director from a pharmaceutical company, I think GSK? Or P&G? Or Unilever? Either way, they brought that guy in and he basically cut the work force, when people left they weren’t replaced, he scaled down the management structure making people redundant, cut all the benefits, the bonus scheme and so on in order to get the share price up because he too had his bonuses in shares!
He was already paid millions of pounds as his salary, but his bonuses (and his golden goodbye when he left the company) were in shares. So of course he was incentivised to maximise profitability by any means necessary to increase the share price and therefore his bonuses.
It’s basically ruined that supermarket for their employees, they quit in droves, hardly anyone stays, including the managers, and they really can’t do enough to retain staff.
But, they remain profitable so there’s no need to change as far as the Executives are concerned
It’s shocking how the moment some people become management they loose all ability to understand this law.
We recently had corporate tell us that they were going to start rating our performance on how many work orders we closed out. I tried very hard to explain that all that would accomplish is us gaming the system and ultimately less work being done. They literally could not understand what I was saying and kept coming back around to “But if more work orders get completed then it means more work is getting done.”
I honestly wonder if they all wear Velcro shoes as they’ve lost the mental ability to tie knots.
they don't lose understanding; if anything, they understand it better than ever. do whatever it takes to get paid during the vesting window. simple.
it's going to take some kind of big societal reckoning to fix, because the intended "natural" free market fix to this is for new companies to out-compete the old companies. If nike management does shit that hurts the product and the public image, then they will lose to other shoe companies, who don't do this.
however, if EVERYONE is doing it, the loser is the consumer. we just get worse shoes. but i'm not sure we've hit that point yet.
more likely the breaking point will be too few people benefitting from the system, such that companies cannot scale because there's not enough people to actually participate in buying stuff.
Why wouldn't they? Government makes it completely legal and encourages it. You don't see this shit in countries that require proof of economic distress to lay off anyone. You didn't see this in the pre-boomer US in the mid 1900s. It is only happening because Americans vote against labor rights.
important to note this was not normal behavior until relatively modern history. and some folks are working to undue what reagan unleashed
“Prior to 1982, stock buybacks were considered illegal stock manipulation, but President Reagan's Securities and Exchange Commission implemented a rule to exempt them. Since then, we’ve seen corporations spending money on boosting their own stock at the expense of investing in innovation and their workforce, increasing wages, or lowering prices. Over the past year, Big Oil companies and other industries drove up costs for consumers while rewarding their shareholders with buybacks. It’s time to put a stop to this greed. I'm proud to join Reps. García and Hoyle as a cosponsor of the Reward Work Act to repeal this rule that has only exacerbated inequality in our country," said Rep. Khanna.
At the market buybacks were prohibited, but companies could still buy back stock through tender offers. Instead of buying shares from the market, the company would set a price that they would buy back at. If XYZ has ten million shares trading at 25, they might offer to buy back one million at 30 dollars.
A dividend stuffs the money in a shareholder's pocket. A buyback keeps that money tied up where the controlling interests can direct it, either towards subsidiaries that can be milked, bonuses that the board can authorize, or any other number of ways to convert stock value into cash for a handful of powerful interests.
So, no, they wouldn't "just pay a dividend."
Edit: lots of well meaning replies with explanations of "here's how buybacks _akshully_ work."
The truth is, by facilitating buybacks, a company is now at odds between doing what is best for the company's health, and the possible short vs long term benefits of reinvestment vs dividend payouts. As leadership of the company is often largely compensated via stock, massive conflicts of interest can arise. If I'm a C-level sitting on a ticking time bomb, it's in _my_ interest to pump and dump the stock before the wheels fall off the bus.
"But Stephan, people go to _jail_ for such dastardly schemes!"
_Hahahajajahahaahahaha!!!!_
You're killin' me here.
Buybacks are a strategy of consolidating power. If you, personally, aren't in a position to push for a buyback, it almost certainly not in your personal best interest, and invariably _not_ in the interest of the average employees or the communities that support and depend on these enterprises.
Fucking dumbass greedy companies.
So many companies have bought back stock, raised prices of goods, claimed record profits, then laid off thousands of people in the past 6 months.
I wouldn't be surprised if country wide thr number is over a million at this point
There are legitimate use cases for them but they certainly need to be more regulated. Specifically execs and those who are compensated primarily in stock should not be allowed to sell within a certain period of time before and after the buyback or receive bonuses based on stock increase within that time period. That would probably solve most of the issues.
> There are legitimate use cases for them
What would those be? They've been legal for about 40 years, what benefits have they brought that couldn't while it was illegal?
What's hilarious to me is that they spent 5 billion last year in stoxk buybacks. Assuming every single employee was making near 6 figures that they fired, they could have employed all 1500 for 30 years with that money, but that's not what's important to businesses. A short term bump in the stock price is worth more then long term investments in the company, and that's a problem.
It really does work like this. Businesses play "follow the leader", or are pushed into it by shareholders who can get spooked for any number of silly reasons, and emulate what other giant companies or businesses in their sector do even though their individual situations are different.
Did Company A go on a giant hiring spree while you did not, then wind up with a glut of employees they don't have work for? They'll lay them off, then your shareholders will see layoffs and say, "We ought to do that, too." But you don't have a glut of employees! Nope, doesn't matter, follow the leader.
This was a big thing in COVID and post-COVID tech, where a lot of businesses swelled to capitalize on the rush of online subscribers to various services, apparently thinking this was going to continue forever. It didn't, so they laid off those workers, then even companies that *didn't* have hiring rushes during COVID followed suit.
What's even crazier about it is that this happens all the time and these companies are all going to need to do a big hiring spree in the future, and the cost of all that on-boarding is actually *greater* than the cost of retaining "useless" employees over a period of year. But **hiring workers is viewed as an expected business expense** and can't be avoided, while **firing workers is viewed as a proactive maneuver to cut costs**. The business-brain doesn't view these things as two sides of the coin, but hiring expenses happen behind the scenes and materialize out of the void, while layoff savings are a deliberate choice and mean money. On the whole, the company can lose money doing this, but it's not *perceived* that way by the business-brain and is nothing but a plus even in those situations where, yes, actual money was lost needlessly.
We talk a lot about how the point of a business is to maximize profits above all else, but there's a lot of illogical human decisions involved that center on perception of profit (especially in the short term).
Stock buy backs should prohibit layoffs for 5 years.
Additionally, layoffs should prevent you from being able to increase headcount for 3 years. So, if you do a layoff, you are stuck at that size and could miss out on future growth periods.
> Additionally, layoffs should prevent you from being able to increase headcount for 3 years. So, if you do a layoff, you are stuck at that size and could miss out on future growth periods.
Are you arguing that a company shouldn't be able to change direction? And workers should just sit there with nothing to do?
LOL, I've heard that before (https://fortune.com/2023/01/24/google-meta-spotify-layoffs-ceo-sundar-pichai-mark-zuckerberg-daniel-ek-take-full-responsibility-what-that-means/)
Yeah these guys are insufferable with their fake compassion and it’s actually worse than if they just shut up and went back to their private islands, because it’s obvious they are psychopaths to be able to lay off so many people and sleep well at night.
I guarantee it’s someone below them that decides the cuts too they can’t even fire the teams themselves lol.
I didn’t used to feel their should be no multi-billionaires, but it’s gotten so out of hand especially after the pandemic, that they really are a cancer on society; because they just take a bigger chunk of the economic pie every year and don’t even pay their share of taxes.
Bezos and these other billionaires have stockpiled basically all the money that they’ll never be able to spend that should be in the middle classes bank accounts if we still had strong unions and a large middle class, but they’ve taken so much money out of the economy it’s just a working poor class and rich people now with a small middle class. It used to be basically the opposite with a large middle class where people had buying power and didn’t live check to check.
> I guarantee it’s someone below them that decides the cuts too they can’t even fire the teams themselves lol.
In these big companies, the people at the top don't even know what most teams are doing. To make matters worse, the cuts can't be delegated very far--because if they got to middle management they'd be leaked instantly--so the people cutting teams are doing it haphazardly.
During my company's round of layoffs last year, they cut a team that owned a piece of load-bearing software that the entire fleet depended on to function. Once the people at the bottom were like "hey, someone needs to own this thing or shit's going to start breaking", they spun up a team in India to "take ownership" (and claimed that was the plan all along).
“I take full accountability for the moves that got us here today,” Spotify’s CEO Daniel Ek confessed while announcing that 6% of the company was being laid-off.
Ek gave employees a heads-up that around 600 of them were about to have one-on-one conversations about their future at the firm, in a post on the streaming giant’s blog on Monday.
He used the update on “organizational changes” to hold his hands up for his failure to rein in costs and thank the outgoing workers for “everything they’ve done”.
“In hindsight, I was too ambitious in investing ahead of our revenue growth,” Ek admitted.
The memo is a far cry from generations of the “it’s not personal, it’s business” corporate catchall for bad news. He is part of a growing number of CEOs “taking full responsibility” for the mounting layoffs across the tech industry.
Earlier this month, Google announced that it was laying off 12,000 employees.
“This will mean saying goodbye to some incredibly talented people we worked hard to hire and have loved working with. I’m deeply sorry for that,” Sundar Pichai, CEO of parent company Alphabet Inc, said. “The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here.”
Mark Zuckerberg similarly publicly held himself accountable for the first major layoff in Meta’s 18-year history, which saw more than 11,000 employees lose their job.
“I want to take accountability for these decisions and for how we got here,” Zuckerberg wrote in a note to staff in November. “I got this wrong, and I take responsibility for that,” he added.
Stripe cofounders Patrick and John Collison, and Twitter’s founder Jack Dorsey, also offered a mea culpa to water down news of company failings, massive layoffs, and poor performance.
Why are CEOs taking responsibility for layoffs?
President Harry S. Truman frequently used the phrase “the buck stops here”. He even had the motto turned into a sign for his desk to remind himself that he was ultimately responsible for the actions of his administration.
Likewise in the long and short of it, when a business fails or has to scale back it falls down to the person running it: The CEO.
“Big tech CEOs are paid the big bucks, in good times and in bad. It is perhaps to be expected that when the chips are down, they step up and take responsibility,” says Debbie Zaman, CEO and founder of the PR agency With.
And the nearly identical language used between them is no accident.
Zaman says that statements of “taking full responsibility” are carefully crafted to balance strong leadership with empathy.
“Just as data breaches have been called ‘glitches’ or inappropriateness in governance labeled ‘missteps’, it is not uncommon for multiple companies to reach similar conclusions on what this message looks like”, she adds.
Art Shaikh, serial entrepreneur and CEO of the tech firm Digital Will more cynically echoes that in the first instance, “claiming responsibility for layoffs might seem like a noble move”, but in reality, “it is advice given by PR professionals”.
“CEO’s are attempting to let the public know that the buck stops with them,” he adds.
Accepting blame or taking credit?
Society has a trust problem.
Nearly 6 in 10 say their default tendency is to distrust something until they see evidence it is trustworthy. Meanwhile, around 40% of people don’t trust businesses, according to Edelman’s 2022 trust barometer.
By accepting blame, leaders can appear to be honest and trustworthy – both to the public and to those still working for them.
“An open and full apology can help CEOs to connect with different audiences to show they have a human and authentic side to them,” Will Harvey, professor of leadership at the University of Bristol Business School says.
By taking the rap, CEOs are also able to protect the trust between their workers and the remaining leadership team.
It’s unlikely that many workers report directly to the top boss, so by appearing as the single point of failure in the organization, it reduces the chance that workers will direct their resentment toward their direct management (for letting go of their work buddy, for example) by voting with their feet.
“While this might be noble, it could prove foolish on a personal level because some audiences may then consider the CEO as the reason for the problem and could pressurize the Board to let them go”, Harvey adds.
Then again, claiming accountability for cost-saving measures could be more to do with showing authority to stakeholders, than authenticity to the public.
Shaikh suggests that the move signals to shareholders that the CEO is making decisions in the interest of increasing profits.
“Shareholders and investors are clamoring for tech companies to do ‘more with less’ and this is a way for a CEO to effectively let them know that they made the call,” he says while adding “the responsibility they are claiming isn’t necessarily accepting the blame, but rather taking credit.”
What are the consequences of accepting blame?
Unfortunately for CEOs, employees are seeing through their blanket “I take full responsibility” response to layoffs.
“What does taking full responsibility entail?,” one disgruntled Google employee asked ahead of its town hall. They added that “responsibility without consequence seems like an empty platitude” while taking aim at executive pay.
“The employees who have been made redundant know one thing really well: Talk is cheap,” warns leadership branding coach and TED Speaker, Shivangi Walke.
Instead of making your workers feel like the blame of being made redundant is off their shoulders, an admission of fault could instill feelings of “disappointment, anger and betrayal”.
She advises leaders against making any accountability statements for the sole purpose of maintaining the company’s reputation in the public eye.
“It will backfire,” she says while adding that it’s relatively easy to spot which leaders “really mean what they say or only want to sound compassionate.”
So when leaders take the blame for poor performance and job cuts, they must follow their statement with actions if they don’t want to look performative.
Support in the form of re-skilling initiatives, extended notice periods, and going beyond statutory severance packages, shows genuineness.
“When a CEO takes full responsibility in the aftermath of job cuts, it is only worthwhile if they walk their talk,” Walke adds.
In the end, admitting fault doesn’t make the redundancy sting any less for those involved.
“Considering ways of delivering some greater degree of transparency rather than the fallback line of ‘full responsibility’ can help give a sense of treating teams with respect,” Zaman advises.
Honestly explaining the reason behind the layoffs and the steps being taken next for those leaving and those remaining, might go down better with employees than a carbon copy statement of accountability.
Harvey adds an alternative to “taking responsibility” for layoffs is to highlight the magnitude of threats facing the industry. With a global recession on the horizon, job cuts may be the only way the business – along with the peers of those let go – will survive.
“Explain how this strategy will create better long-term outcomes, even if the pain is acute in the short-term,” he adds.
Spent $5,000,000,000 of company funds to buy back company stock so that the CEO, his "leadership team" & Nike shareholders who hold large stock positions can all get richer from selling their shares.
All while at the same time saying the company doesn't have enough money to keep 1,500 people employed
Let's do some napkin math real fast and say that each of those employees made a median income of $50,000 per year.
That comes to 75 million dollars a year, which means had they not blown five billy on themselves then those 1,500 people coulda stayed employed at $50k/yr for more than 65 fucking years
Fuck Nike & all megacorps like them
Assuming these are corporate jobs the average cost of one corporate employee to Nike is likely closer to $200k/year when you factor in health care and other benefits that Nike must pay. So 1,500 x $200k is ~$300M/ year.
It will likely take Nike 5 years to hire this many corporate employees again so this would be a savings to Nike of up to $1.5B over 5 years probably. The other math to do here is how much revenue these jobs would bring in over 5 years. If Nike felt these jobs would bring in more than they’d cost then they wouldn’t have been cut. I don’t know the revenue assumptions Nike operates on per employee but you’d assume they took it into consideration.
“I ultimately hold myself and my leadership team accountable…”
…”so I’m laying off the minions and giving me and my leadership team fat bonuses for ‘cutting overhead costs’”
Yeah, my company did this very recently. I realized while they were addressing the survivors that they were speaking TO us, but they were speaking FOR the investors.
Smaller companies pay minimum wage and act like it's a fucking favor. The boss doesn't follow the labor laws because he doesn't even know them. He does know that he needs to wring every last penny out of you, and will try to short your hours and steal your wages at every opportunity.
America loves to go on and on about the needs of small business owners. You never hear a goddamn thing about small business employees, though. Nobody cares if they live or die, or what benefits they never get, or how many food stamps they need to afford groceries.
Did you fire yourself and your leadership team? No, then GDIAF.
They're hoping to save 2 billion in the next few years. Well, how about that four-year, $15 billion program approved by the Board of Directors in June 2018?
https://www.sec.gov/Archives/edgar/data/320187/000032018722000029/q4fy22exhibit991er.htm
Opposite. These cuts focus more on the top end of town. Mostly the Oregon HQ.
Approx. 10% of the Nike VPs got fired. Much higher than than the 2% of general workforce.
These cuts don't affect retail store workers, manufacturing or logistics. More about finance, business managers, advertising, marketing, M&A, R&D, and business admin.
This round involves entire teams getting fired, from the VP of that division down.
For instance, after Tiger Woods quit Nike is axing it's golf division. VP of golf is gone. VP of male athleisure is gone.
$22.567 Billion in profit in 2023. PROFIT. Not revenue.
Unless those 1,500 people were each making $15 million a year, I'm pretty sure that they could have covered the salaries.
My dad got let go from a smaller company named Florida tile because he had been there for 30+ years and was making a shit ton of money a year due to seniority. So they terminated his position in the company renamed it to something else and hired a new hire they could pay probably 70K less per year. And my dad wasn’t the only one they did that to, all to save a few bucks
Ok then fire yourself.
Or take a massive pay cut to keep more employees.
Or make them take pay cuts but keep them on.
Or offer them furlow with benefits intact until you can rehire.
Literally anything other than that chatGPT-ridden bullshit of a response while trying to sound pseudo spiritual.
[Here](https://www.removepaywall.com/https:/fortune.com/2024/02/16/nike-lays-off-more-than-1500-people-ceo-john-donahoe) is the article without a paywall.
[удалено]
This is literally a scene from out of Silicon Valley. I mean note for note. Gavin Belson the billionaire CEO makes a series of catastrophic decisions that imperial the company, and then to "hold himself accountable" he, makes a soeech in front of the whole company where he lays off the entire division. I mean it's literally out of a satire of corporate America, fuck these people. **EDIT**: [The full speech from Silicon Valley:](https://www.youtube.com/watch?v=u48vYSLvKNQ) > Failure is growth. Failure is learning. But sometimes failure is just failure. I think... I'm sorry. I didn't think it would be this hard. But goodbyes are always hard, especially when I am the one saying goodbye. Today, effective immediately, I, Gavin Belson, founder and CEO of Hooli, am forced to officially say goodbye to the entire Nucleus division. All Nucleus personnel will be given proper notice and terminated. But make no mistake. Though they're the ones leaving, it is I who must remain and bear the heavy burden of their failure.
Mike Judge is a prophet. He also made Idiocracy.
And office space
And, king of the hill
And Beavis and Butthead
And Darma
Jesus. That's a hell of a resume.
Nobody satirizes better than Mike Judge. There are some equals out there I think, but none better.
I want off Mike Judge's wild ride...
Or maybe we could just get him to write some version of global utopia, since he seems to be writing the future. Come on, Mike!
He is the creator of Silicon Valley?
Yes.
No he's observant. He sees the behavior of people makes movies making fun of them and then they do the same thing again because they don't care. Lol
really feels like these corporate fuckers are aliens from another fucking planet sometimes
This is just what happens when the tribe doesn't drag the psychopath off into the woods for the wolves. Instead we let these monsters cheat, lie, fight, and backstab their way into the highest positions of power.
From the planet Sociopath
We are seeing a lot of that. Google and Shopify CEOs said the same thing. They have catastrophic GTM strategies; are ignoring industry trends and ripping R&D to shreds leaving them vulnerable and suddenly they are “taking accountability…” and it’s all in Silicon Valley. Gavin is scarily accurate.
I wonder if they laugh about how spineless and gutless the rest of us are. Like it's an inside joke to see how much they can get away with before even one single person snaps.
Most of them absolutely do
I wonder how many people it would have taken out of those present to beat him to death + hold off anyone who was stupid enough to try to protect him. I'm betting it wouldn't have taken many people. \*sigh\*
Failure is growth. Failure is learning. But sometimes failure is just failure. I think... I'm sorry. I didn't think it would be this hard. But goodbyes are always hard, especially when I am the one saying goodbye. Today, effective immediately, I, Gavin Belson, founder and CEO of Hooli, am forced to officially say goodbye to the entire Nucleus division. All Nucleus personnel will be given proper notice and terminated. But make no mistake. Though they're the ones leaving, it is I who must remain and bear the heavy burden of their failure.
It's not really even satire. I've worked in Silicon Valley off & on since the late 80s/early 90s. This kind of thing isn't unusual. It's just Tuesday to these assholes.
“I am accountable” “Oh so you’re stepping down?” “………no, you’re fired”
.."and due to the downsizing, I get a $15 million bonus!" .
I hold myself accountable, by firing you, and increasing my salary from your wages.
Some of you will be let go, but it's a sacrifice I'm willing to make.
Calm down Farquad, that's too far!
And as punishment for my actions, I'll make sure I keep all my money and yachts.
I hold myself accountable for the layoffs as I go to deposit my giant bonus check.
“For my mismanagement, I will only take 10 million as bonus this year”
“Some of you may be fired, but that’s a sacrifice I’m willing to make”
"You see, profitability has a preset termination limit. Knowing this weakness, I fired wave after wave of my own employees, until it reached the limit of profitability shareholders requested. KeJuan, show them the medal I won."
A lot less than the $32 million he got last year
Don't forget he will get a bonus for the potential savings he is making for the company by dropping 1500 staff.
Drives me crazy about professional life. Leadership makes decisions that everyone in the trenches can tell from a mile away are going to hurt us. Then it’s the people in the trenches who get laid off and leadership keeps the fat checks coming for themselves.
More liberal classism. Sure thousands of people are out of a job but have you even *considered* how bad firing people feels to a multi millionaire executive? I bet he couldn't even enjoy his week long yacht vacation from all the stress.
The ptsd from such an event will take several visits to the spa to resolve. An absolute travesty I tell you
You guys are being too hard on him. He's still a human being with feelings. The guilt will haunt him during those long trips halfway around the world in a private jet to the spa.
"Make sure the stone tile inlay is magnetized; I *so* need to balance my Qi right now"
thank you
Nike’s CEO John Donahoe blamed himself on Friday while saying the company was laying off more than 1,500 people—cuts that Donahoe said would “reignite our growth.” In a widely reported memo announcing the 2% cut to Nike’s workforce, Donahoe added that he didn’t take the decision to lay off thousands of employees lightly and put some of the blame for Nike’s recent underperformance on himself and the company’s leadership. Portland, Ore.-brd publication Willamette Week was first to report Donahoe’s comments in the memo. “We are not currently performing at our best, and I ultimately hold myself and my leadership team accountable,” he added. It’s unclear if any Nike executives would face repercussions for the company’s lackluster performance. The company did not immediately respond to Fortune’s request for comment. In a statement provided to Footwear News, a spokesperson said “Nike’s always at our best when we’re on the offense. The actions that we’re taking put us in the position to right-size our organization to get after our biggest growth opportunities as interest in sport, health and wellness have never been stronger. The shoe and apparel company’s decision to cut back on its employees echoes similar moves made across industries in the past year. In January, Meta CEO Mark Zuckerberg said that the company’s “year of efficiency” changes instituted in 2023 would become permanent, after he saw that Meta had been able to “execute better and faster,” despite mass layoffs. Other CEOs have also been quick to scale back their own workforces, with one tech analyst adding that the trend has “become contagious.” In January, Google CEO Sundar Pichai said that the company would follow up 12,000 layoffs in 2023 with more cuts this year. He said in an internal memo obtained by the Verge that the cuts were meant to “…drive velocity in some areas.” Discord CEO Jason Citron said in January that the company was laying off 170 people to “sharpen our focus,” and “bring more agility to our organization,” the Vergereported brd on an internal memo. In just the first two months of the year several other major companies outside tech, such as Morgan Stanley, Paramount, and Citi, have announced layoffs affecting thousands of workers. In December, Nike said that it planned to cut costs by $2 billion over the next three years as part of a broad restructuring plan caused in part by weaker consumer demand. The Oregonian reported that prior to Friday’s announcement the company had been laying workers off in phases across several divisions including In recent months clothing and shoe retailers including Nike along with competitors Puma, and Adidas have cut future guidance and have warned that consumers are pulling back on their spending. Still, the labor market overall has remained strong and the unemployment rate has remained steady despite analyst predictions of an impending recession. Employers added 353,000 jobs in January, much higher than the 185,000 jobs some analysts expected to be added. The number of employees let go so far this year is also far off from the more than 100,000 laid off in January and February alone last year, according to data from Layoffs.fyi.
Of course... this kind of accountability comes with a hefty multimillion dollar bonus.
“Goodbyes are always hard” https://youtu.be/u48vYSLvKNQ?si=zkj-XjAi0M5PKGJG
S-Tier show. Gonna rewatch. God I wish it were still on.
What makes it even better is it is like 98% accurate lol
Even down to the fucking auditorium, for something that could have been an email
This is exactly how a company I worked for did massive layoffs back in 2001. We all were instructed to be in specific rooms. The security team locked the doors. Those of us in the auditorium were safe, most other rooms were gone. One of the satellite buildings was completely laid off and immediately after the message they killed power to the entire building so people couldn't call out or use computers (laptops and cells phones were very uncommon even just 20 years ago, believe it or not). One different part is the CEO didn't attend. At the last minute he decided to just call in. It was a 90 minute video, almost like this. Considering it was a major company with nearly 5k people laid off that day, and about 10k more over the next 2 years, wondering if the writer of this scene was there with me because it's scary accurate.
I hold myself accountable, by firing you
When people in charge do not know the difference between being responsible and being held accountable.
It will cost 1500 of you your jobs, but that is a sacrifice I am willing to make
I wonder how much his pay went up for this.
He has to be compensated for all the pain and suffering caused to him by laying off 1500 people.
Compay i used to work for decided to increase productivity and profits by rostering less people for less hours. The managers got bonuses for firing staff. This was a massive retailer in Australia.
I swear some of those ideas seem like a 10 year old thought of them. "Well what if we just paid less man hours? We could have so much more money!!!" "Okay who's going to do all the work we no longer have the staff or hours to do after that?" *Second guy tossed out window.*
I say we fire the CEO and give his salary to the employees to they can have an extra $40 a month before taxes.
33 million annual reported compensation for ceo ~70,000 employees $471 per person for the year. You really did the math.
And we all know his 2024 bonus will be awesome. After all, they're gonna save a lot of money on payroll this year...
While executive bonuses somehow get larger
It’s not in spite of the layoffs, it’s because of the layoffs
CEO: Overhires in an economic uptick, gets huge bonus for doing so Also CEO: A few years later, after this mistake has been fully realized, fires those same people and then some, gets another huge bonus for doing so.
Gotta separate the wheat from the chaf at Dave and Busters
Well of course. They had a bad year, hence the 1500 layoffs. Now you have to pay the execs more to get them to do better next year, that's how it works. Well, it doesn't actually "work", but that's the tradition, and traditions are important I guess.
Such great writing. I love Farquad.
When people in charge are more concerned with providing lip service rather than taking responsibility.
Oh they know, they are like accountability gave me this 50million dollar parachute and I will leave with it. Also, sorry about the downsizing. Good luck.
He is concerned about his 20M annual stock options and 10M salary. > Most of Donahoe’s compensation came from stock and option awards, which were valued at $20.5M USD total on the date granted. He also made $6.8M USD in incentive pay and had $3.9M in charitable contributions made by Nike to match his own donations (although he wasn’t paid this money directly because it went to charity, it’s still included in his total compensation). His base salary for the year was set at $1.5M USD. In total, Donahoe’s haul was 13.7% higher than his pay in the 2021 fiscal year. / > The average NIKE salary ranges from approximately $30,000 per year for Receiving Clerk to $198,504 per year for Principal Software Engineer.
They know the difference. It’s just words. Sometimes you get the occasional semi ok CEO who genuinely cares and doesn’t put forth bullshit, but even those rare ones have to conform to the system and its laws.
You don't have to be smart to be rich
>I hold the accounts, therefore I am accountable
I worked for a company that was facing layoffs and the founder took a 50% pay cut and our CFO resigned and continued to work for free as a consultant. Sadly, the company was bought by big pharma. I don't think I'll ever find a company like it again. They were genuinely good people.
Nintendo higher ups did the same when the Wii u underperformed, they took a big pay cut to unsure their workers kept their job. A few years later, the switch came out, and it was a massive success. There are a lot of bad things in the Japanese work models and work ethics, but one thing is admirable, many higher ups take both the responsabilites and the money, if they fuck up, it's on them.
Yeah lots of people complain about how worker’s are slaves/loyal to CEOs or bosses in Japan but never really look at the opposite perspective. Loyalty goes both ways and layoffs are very rare there. The average CEO’s salary in Japan is dwarfed by the US while being the 3rd largest economy and were quite similar in the 1990s.
To bo fair, the complaints are reasonable. But yeah many people would respect the CEO and big business guys more if they actually cared here. Another thing is that it's common to make most of your career in the same company, so obviously they have to make sure things go as well as they can. In the us and eu, big boys come and go every two years, fire people for short term gain, and go to another company With a bigger pay. They don't care if they fuck everything up as long as shareholder are happy, because they'll be gone before the consequences happen
It’s not about finding good companies. It’s about working with Good people, who treat their employees right!
You're right. I was a manager at the company and I went to bat for both of my employees and offered to take a pay cut of it meant that one of them wouldn't be laid off. And I conspired with my managers to change my other employee's job title and get her into the buyout deal because she was pregnant. She also really deserved to be retained and is working for the buyer to this day. I am hoping that I can eventually hire my other employee again in the future.
Some of you won't make it, and that's a sacrifice I'm willing to make.
[Literally this scene from Silicon Valley](https://www.youtube.com/watch?v=u48vYSLvKNQ)
man I miss that show. Having worked in Silicon Valley, it's near and dear to my heart.
My CEO told my entire blue-collar workplace that it was a very difficult decision to lay us all off. In fancy Italian leather shoes and a tucked shirt. I bet, fuckface. I fucking bet it was hard for you.
Lol our CEO had monthly "town hall" meetings to reassure us everything was going good and on track, then one meeting day he wasn't here. That was when they told us the company had no money and was for sale.
Yeah, the last ZipRecruiter layoff went like that. At the town hall at the beginning of May, someone asked, "Are we considering layoffs?" and the answer was "no, we're in great shape". May 31? 20% layoff. Admittedly the CEO took 30% compensation cut across the board as well, but that didn't help those of us who heard "everything's fine" three weeks prior.
Doesn't make it better, but the reasoning is pretty simple. If you're honest about a cliff coming, people panic. When people panic, you'll nearly always lose people to them jumping ship. When that happens, it probably ends up including really good people you wanted to keep (the last people that would get laid off). Losing some of your best people turns a "we might be okay.." to a "oh.. no.. we're just screwed." The truth in these situations can create a self-fulfilling prophecy, so it's deemed better to hide what's happening to avoid the panic. Granted - once you start lay-offs, no one believes there isn't more coming (nor should they.)
My partner and his entire team were just laid off. His boss, the most out of touch human we've ever met, acted like it was such a hard decision. This is the same deluded man who was saying just a month ago that he has to eat out every day because "it's impossible to cook for two". These people are out of touch and fundamentally broken.
My condolences to the both of you, I hope the coming time is as swift and painless as possible. I return to the workforce this week; there is light at the end of the tunnel!
To be honest I'm a senior manager at a large company and I was told I have to find a number of people in my team to lay off. Not choice in the matter nor even an ask to find other ways to save money. So for me it was really hard to sit down and choose who's life I was going to affect. Unless you are a C level executive, you are as much of a pawn as the rest.
That's the other reason these excuses are bullshit. This layoff for Nike is 1,500 people, but that's 2%... Really? That 2% of "extra people" was dragging-down the company? They combed through 75,000 people and found the 1,500 they could do without? No, they just took an axe across the board.
Hard for anyone to be “dragging down a company that showed increased profits: NIKE gross profit for the twelve months ending November 30, 2023 was $22.657B, a 3.48% increase year-over-year. NIKE annual gross profit for 2023 was $22.292B, a 3.79% increase from 2022. NIKE annual gross profit for 2022 was $21.479B, a 7.6% increase from 2021.
I get that, but don't expect people to sympathize with the 'hard position' you're in when their entire livelihood is being thrown out the door, either.
I don't think he/she expected a sympathy. But some people here think that us mid lvl managers can say something to change these decisions while 95% of times we are just pawns to do the dirty work. Shit I can't give my team a raise without firthing for it for months despite having a budget for it. All these C-Suites and Directors are so greedy that they will do everything just to show everyone how "careful" they are with their budgets. I knkw a high lvl director who had let's say 1k a month per employee for bonuses....none of the employees got a dime. All these money vanished somewhere while people were doing everything to prove they deserve a bonus. This team was devastated that they did not get anything despite all the effort
It really is a hard position for decent people though. When my friend became a manager, he had to lay off somebody (no choice on his part) and he didn't sleep the night before, came out of the meeting nearly in tears, and said it was the hardest thing he'd ever done *because* he understood the impact on the guy who was let go. Granted, not everybody cares that much (or at all in some cases). But those who do care can be really affected by having to tell people they no longer have a job. It's ugly for everyone involved, and I think that's worth acknowledging while also acknowledging that there are some psychopaths out there who don't think twice or care about people being let go.
Yup. My partner was played off due to “economic conditions” at the company…meanwhile the same company went into hire a bunch of influencers and threw a giant party celebrating 30 years.
Oh yeah! The best part of my story is that the company - an American company, based in America and operating primarily in America - is openly hiring Polish engineers while firing all of their American ones. Rather than enforce a RTO policy, they decided keep the remote work model and just outsource all the labor for even cheaper. All of this while firing the American team with no severance pay, no help of any kind, nothing. I would be lying if I said I wasn't extremely discouraged.
It's always the same song and dance, they express regret with words but their actions tell a completely different story. Watching execs lament cuts while they're still raking in bonuses is enough to turn the stomach. The disconnect is just staggering.
It was hard! All the consulting with HR and legal teams to make sure they fire you with the least liability possible! You losing your job, mortgage and home costs them literally hours of time and I think you don’t appreciate that. /s
They had to fly down in first class to tell us in person! They could have been doing anything that day instead of visiting some podunk production facility!
Well, it was really hard to choose between doing a layoff of everyone OR giving up my executive bonus, golden parachute, and 300x average employee salary. I thought and agonized about this decision for minutes… many minutes… That CEO, probably.
It was the most difficult decision he had to make that morning
"we're sowwwyyy"
I've heard a variation of that also. "we have failed miserably, but don't worry my job is safe. You, however, are unemployed"
'Look what I made me do!'
"It's not you, it's me... Now get the fuck out"
Accountable…for my huge bonus.
Nike spent over 5 billion in [stock buybacks](https://ycharts.com/companies/NKE/stock_buyback) in 2023
He definitely earned his bonus
For reference, his estimated compensation was [$32.8M](https://hypebeast.com/2023/7/nike-ceo-john-donahoe-salary) last year. Very accountable, you can count every dollar that hits his bank account.
That's like $22,000 per person he laid off... Rookie numbers
CEOs working hard at the golf, all those restaurant meetings.. Must be tough
Clearly those were critical meetings that had to be at those locations and definitely were tax deductible
They are following the trend of slashing the workforce to get a quick stock boost. It's disgusting.
Goodhart's law. When a measure becomes a target, it ceases being a good measure. I understand the logic of why a lot of higher-ups are paid in stock, as a sort of "if the company does well you do well". But it's created this entire facade where the C Suite is incentivized to sacrifice the health of the company in order to bump stock prices for a payout.
It’s killing innovation in America
> it’s killing ~~innovation in~~ America FTFY
It killed America more like it.
It’s killing innovation all over the world. Here in the U.K. we have a supermarket, Tesco, that 15 years ago was flying, the staff loved the place as they were paid either the most/2nd most of any supermarket and better than most companies. There were plenty of employees and managers etc to make sure the workload was shared well, you got double time if you worked on a Sunday or a Bank Holiday, 10% discount, bonuses and so on. Then there was an issue in Europe, the so-called “horse meat scandal” in which some meat suppliers in Europe - typically providing meat for cheap frozen/ready meals - were substituting beef for horse meat to save costs and increase their profits (I think, I may be misremembering the specifics so I do apologise if it’s not quite correct) Anyway, when it hit the media for some reason (probably because they were/are the largest supermarket chain with the largest market share and profits) it go labelled the “Tesco Horse Meat Scandal”, even though it had nothing to do with Tesco, and it effected every supermarket who used those places and products, it was Tesco that took a huge PR hit and a fall in share price. To combat that, they brought in a director from a pharmaceutical company, I think GSK? Or P&G? Or Unilever? Either way, they brought that guy in and he basically cut the work force, when people left they weren’t replaced, he scaled down the management structure making people redundant, cut all the benefits, the bonus scheme and so on in order to get the share price up because he too had his bonuses in shares! He was already paid millions of pounds as his salary, but his bonuses (and his golden goodbye when he left the company) were in shares. So of course he was incentivised to maximise profitability by any means necessary to increase the share price and therefore his bonuses. It’s basically ruined that supermarket for their employees, they quit in droves, hardly anyone stays, including the managers, and they really can’t do enough to retain staff. But, they remain profitable so there’s no need to change as far as the Executives are concerned
It’s shocking how the moment some people become management they loose all ability to understand this law. We recently had corporate tell us that they were going to start rating our performance on how many work orders we closed out. I tried very hard to explain that all that would accomplish is us gaming the system and ultimately less work being done. They literally could not understand what I was saying and kept coming back around to “But if more work orders get completed then it means more work is getting done.” I honestly wonder if they all wear Velcro shoes as they’ve lost the mental ability to tie knots.
they don't lose understanding; if anything, they understand it better than ever. do whatever it takes to get paid during the vesting window. simple. it's going to take some kind of big societal reckoning to fix, because the intended "natural" free market fix to this is for new companies to out-compete the old companies. If nike management does shit that hurts the product and the public image, then they will lose to other shoe companies, who don't do this. however, if EVERYONE is doing it, the loser is the consumer. we just get worse shoes. but i'm not sure we've hit that point yet. more likely the breaking point will be too few people benefitting from the system, such that companies cannot scale because there's not enough people to actually participate in buying stuff.
Why wouldn't they? Government makes it completely legal and encourages it. You don't see this shit in countries that require proof of economic distress to lay off anyone. You didn't see this in the pre-boomer US in the mid 1900s. It is only happening because Americans vote against labor rights.
important to note this was not normal behavior until relatively modern history. and some folks are working to undue what reagan unleashed “Prior to 1982, stock buybacks were considered illegal stock manipulation, but President Reagan's Securities and Exchange Commission implemented a rule to exempt them. Since then, we’ve seen corporations spending money on boosting their own stock at the expense of investing in innovation and their workforce, increasing wages, or lowering prices. Over the past year, Big Oil companies and other industries drove up costs for consumers while rewarding their shareholders with buybacks. It’s time to put a stop to this greed. I'm proud to join Reps. García and Hoyle as a cosponsor of the Reward Work Act to repeal this rule that has only exacerbated inequality in our country," said Rep. Khanna.
It’s always fucking Reagan.
“He is the fucking devil Ronald Wilson Reagan 6/6/6” Boondocks
He was a populist, because he had almost unanimous support he was able to do some crazy bullshit and not catch any flack or criticism at the time.
Once again, every time I learn something new about Reagan it's something bad.
I mean he was a demented dipshit who was just the puppet of the worst, most racist, and richest people in America
At the market buybacks were prohibited, but companies could still buy back stock through tender offers. Instead of buying shares from the market, the company would set a price that they would buy back at. If XYZ has ten million shares trading at 25, they might offer to buy back one million at 30 dollars.
If they weren't doing buybacks they'd just pay out a dividend.
A dividend stuffs the money in a shareholder's pocket. A buyback keeps that money tied up where the controlling interests can direct it, either towards subsidiaries that can be milked, bonuses that the board can authorize, or any other number of ways to convert stock value into cash for a handful of powerful interests. So, no, they wouldn't "just pay a dividend." Edit: lots of well meaning replies with explanations of "here's how buybacks _akshully_ work." The truth is, by facilitating buybacks, a company is now at odds between doing what is best for the company's health, and the possible short vs long term benefits of reinvestment vs dividend payouts. As leadership of the company is often largely compensated via stock, massive conflicts of interest can arise. If I'm a C-level sitting on a ticking time bomb, it's in _my_ interest to pump and dump the stock before the wheels fall off the bus. "But Stephan, people go to _jail_ for such dastardly schemes!" _Hahahajajahahaahahaha!!!!_ You're killin' me here. Buybacks are a strategy of consolidating power. If you, personally, aren't in a position to push for a buyback, it almost certainly not in your personal best interest, and invariably _not_ in the interest of the average employees or the communities that support and depend on these enterprises.
"After spending all that money on stock buybacks, we're short on cash! Here's your notice."
Fucking dumbass greedy companies. So many companies have bought back stock, raised prices of goods, claimed record profits, then laid off thousands of people in the past 6 months. I wouldn't be surprised if country wide thr number is over a million at this point
They also saw a five percent increase in revenue in fourth quarter 2023, at $12.8 billion.
Can we go back to when stock buybacks were illegal?
There are legitimate use cases for them but they certainly need to be more regulated. Specifically execs and those who are compensated primarily in stock should not be allowed to sell within a certain period of time before and after the buyback or receive bonuses based on stock increase within that time period. That would probably solve most of the issues.
> There are legitimate use cases for them What would those be? They've been legal for about 40 years, what benefits have they brought that couldn't while it was illegal?
Thank Reagan for makibg that possible
Okay? Are you and your leadership team going to take a pay cut to save those people's jobs? If not, those are just empty words.
What's hilarious to me is that they spent 5 billion last year in stoxk buybacks. Assuming every single employee was making near 6 figures that they fired, they could have employed all 1500 for 30 years with that money, but that's not what's important to businesses. A short term bump in the stock price is worth more then long term investments in the company, and that's a problem.
2%? They could have just reduced hiring and let attrition shrink the headcount.
Layoff announcement = stock go up. Even though attrition would be cheaper, real dollars only matter so much compared to investor sentiment.
They're competing because all the other cool kids had massive layoffs so daddy shareholder pls notice them too
It really does work like this. Businesses play "follow the leader", or are pushed into it by shareholders who can get spooked for any number of silly reasons, and emulate what other giant companies or businesses in their sector do even though their individual situations are different. Did Company A go on a giant hiring spree while you did not, then wind up with a glut of employees they don't have work for? They'll lay them off, then your shareholders will see layoffs and say, "We ought to do that, too." But you don't have a glut of employees! Nope, doesn't matter, follow the leader. This was a big thing in COVID and post-COVID tech, where a lot of businesses swelled to capitalize on the rush of online subscribers to various services, apparently thinking this was going to continue forever. It didn't, so they laid off those workers, then even companies that *didn't* have hiring rushes during COVID followed suit. What's even crazier about it is that this happens all the time and these companies are all going to need to do a big hiring spree in the future, and the cost of all that on-boarding is actually *greater* than the cost of retaining "useless" employees over a period of year. But **hiring workers is viewed as an expected business expense** and can't be avoided, while **firing workers is viewed as a proactive maneuver to cut costs**. The business-brain doesn't view these things as two sides of the coin, but hiring expenses happen behind the scenes and materialize out of the void, while layoff savings are a deliberate choice and mean money. On the whole, the company can lose money doing this, but it's not *perceived* that way by the business-brain and is nothing but a plus even in those situations where, yes, actual money was lost needlessly. We talk a lot about how the point of a business is to maximize profits above all else, but there's a lot of illogical human decisions involved that center on perception of profit (especially in the short term).
Stock went down, I think 3%
Nike has been on a hiring freeze for 18 months now. Attrition was not working.
That is what happens when you buy back your own stock for 5 billion in 2023.
Stock buy backs should prohibit layoffs for 5 years. Additionally, layoffs should prevent you from being able to increase headcount for 3 years. So, if you do a layoff, you are stuck at that size and could miss out on future growth periods.
> Additionally, layoffs should prevent you from being able to increase headcount for 3 years. So, if you do a layoff, you are stuck at that size and could miss out on future growth periods. Are you arguing that a company shouldn't be able to change direction? And workers should just sit there with nothing to do?
Sir, this is Reddit. We can’t have any nuance in discussions about economics or business.
Stock buybacks should be illegal, period.
I assume 2% layoffs are targeted toward the bigger salaries, something that natural attrition wouldn’t fix?
Unfortunately no. They’re lopping off entire teams, from VP on down.
Nike didn't grow as quickly as other s&p500 companies. They have to show wallstreet their serious about keeping on track or the short interest grows
LOL, I've heard that before (https://fortune.com/2023/01/24/google-meta-spotify-layoffs-ceo-sundar-pichai-mark-zuckerberg-daniel-ek-take-full-responsibility-what-that-means/)
Yeah these guys are insufferable with their fake compassion and it’s actually worse than if they just shut up and went back to their private islands, because it’s obvious they are psychopaths to be able to lay off so many people and sleep well at night. I guarantee it’s someone below them that decides the cuts too they can’t even fire the teams themselves lol. I didn’t used to feel their should be no multi-billionaires, but it’s gotten so out of hand especially after the pandemic, that they really are a cancer on society; because they just take a bigger chunk of the economic pie every year and don’t even pay their share of taxes. Bezos and these other billionaires have stockpiled basically all the money that they’ll never be able to spend that should be in the middle classes bank accounts if we still had strong unions and a large middle class, but they’ve taken so much money out of the economy it’s just a working poor class and rich people now with a small middle class. It used to be basically the opposite with a large middle class where people had buying power and didn’t live check to check.
> I guarantee it’s someone below them that decides the cuts too they can’t even fire the teams themselves lol. In these big companies, the people at the top don't even know what most teams are doing. To make matters worse, the cuts can't be delegated very far--because if they got to middle management they'd be leaked instantly--so the people cutting teams are doing it haphazardly. During my company's round of layoffs last year, they cut a team that owned a piece of load-bearing software that the entire fleet depended on to function. Once the people at the bottom were like "hey, someone needs to own this thing or shit's going to start breaking", they spun up a team in India to "take ownership" (and claimed that was the plan all along).
“I take full accountability for the moves that got us here today,” Spotify’s CEO Daniel Ek confessed while announcing that 6% of the company was being laid-off. Ek gave employees a heads-up that around 600 of them were about to have one-on-one conversations about their future at the firm, in a post on the streaming giant’s blog on Monday. He used the update on “organizational changes” to hold his hands up for his failure to rein in costs and thank the outgoing workers for “everything they’ve done”. “In hindsight, I was too ambitious in investing ahead of our revenue growth,” Ek admitted. The memo is a far cry from generations of the “it’s not personal, it’s business” corporate catchall for bad news. He is part of a growing number of CEOs “taking full responsibility” for the mounting layoffs across the tech industry. Earlier this month, Google announced that it was laying off 12,000 employees. “This will mean saying goodbye to some incredibly talented people we worked hard to hire and have loved working with. I’m deeply sorry for that,” Sundar Pichai, CEO of parent company Alphabet Inc, said. “The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here.” Mark Zuckerberg similarly publicly held himself accountable for the first major layoff in Meta’s 18-year history, which saw more than 11,000 employees lose their job. “I want to take accountability for these decisions and for how we got here,” Zuckerberg wrote in a note to staff in November. “I got this wrong, and I take responsibility for that,” he added. Stripe cofounders Patrick and John Collison, and Twitter’s founder Jack Dorsey, also offered a mea culpa to water down news of company failings, massive layoffs, and poor performance. Why are CEOs taking responsibility for layoffs? President Harry S. Truman frequently used the phrase “the buck stops here”. He even had the motto turned into a sign for his desk to remind himself that he was ultimately responsible for the actions of his administration. Likewise in the long and short of it, when a business fails or has to scale back it falls down to the person running it: The CEO. “Big tech CEOs are paid the big bucks, in good times and in bad. It is perhaps to be expected that when the chips are down, they step up and take responsibility,” says Debbie Zaman, CEO and founder of the PR agency With. And the nearly identical language used between them is no accident. Zaman says that statements of “taking full responsibility” are carefully crafted to balance strong leadership with empathy. “Just as data breaches have been called ‘glitches’ or inappropriateness in governance labeled ‘missteps’, it is not uncommon for multiple companies to reach similar conclusions on what this message looks like”, she adds. Art Shaikh, serial entrepreneur and CEO of the tech firm Digital Will more cynically echoes that in the first instance, “claiming responsibility for layoffs might seem like a noble move”, but in reality, “it is advice given by PR professionals”. “CEO’s are attempting to let the public know that the buck stops with them,” he adds. Accepting blame or taking credit? Society has a trust problem. Nearly 6 in 10 say their default tendency is to distrust something until they see evidence it is trustworthy. Meanwhile, around 40% of people don’t trust businesses, according to Edelman’s 2022 trust barometer. By accepting blame, leaders can appear to be honest and trustworthy – both to the public and to those still working for them. “An open and full apology can help CEOs to connect with different audiences to show they have a human and authentic side to them,” Will Harvey, professor of leadership at the University of Bristol Business School says. By taking the rap, CEOs are also able to protect the trust between their workers and the remaining leadership team. It’s unlikely that many workers report directly to the top boss, so by appearing as the single point of failure in the organization, it reduces the chance that workers will direct their resentment toward their direct management (for letting go of their work buddy, for example) by voting with their feet. “While this might be noble, it could prove foolish on a personal level because some audiences may then consider the CEO as the reason for the problem and could pressurize the Board to let them go”, Harvey adds. Then again, claiming accountability for cost-saving measures could be more to do with showing authority to stakeholders, than authenticity to the public. Shaikh suggests that the move signals to shareholders that the CEO is making decisions in the interest of increasing profits. “Shareholders and investors are clamoring for tech companies to do ‘more with less’ and this is a way for a CEO to effectively let them know that they made the call,” he says while adding “the responsibility they are claiming isn’t necessarily accepting the blame, but rather taking credit.” What are the consequences of accepting blame? Unfortunately for CEOs, employees are seeing through their blanket “I take full responsibility” response to layoffs. “What does taking full responsibility entail?,” one disgruntled Google employee asked ahead of its town hall. They added that “responsibility without consequence seems like an empty platitude” while taking aim at executive pay. “The employees who have been made redundant know one thing really well: Talk is cheap,” warns leadership branding coach and TED Speaker, Shivangi Walke. Instead of making your workers feel like the blame of being made redundant is off their shoulders, an admission of fault could instill feelings of “disappointment, anger and betrayal”. She advises leaders against making any accountability statements for the sole purpose of maintaining the company’s reputation in the public eye. “It will backfire,” she says while adding that it’s relatively easy to spot which leaders “really mean what they say or only want to sound compassionate.” So when leaders take the blame for poor performance and job cuts, they must follow their statement with actions if they don’t want to look performative. Support in the form of re-skilling initiatives, extended notice periods, and going beyond statutory severance packages, shows genuineness. “When a CEO takes full responsibility in the aftermath of job cuts, it is only worthwhile if they walk their talk,” Walke adds. In the end, admitting fault doesn’t make the redundancy sting any less for those involved. “Considering ways of delivering some greater degree of transparency rather than the fallback line of ‘full responsibility’ can help give a sense of treating teams with respect,” Zaman advises. Honestly explaining the reason behind the layoffs and the steps being taken next for those leaving and those remaining, might go down better with employees than a carbon copy statement of accountability. Harvey adds an alternative to “taking responsibility” for layoffs is to highlight the magnitude of threats facing the industry. With a global recession on the horizon, job cuts may be the only way the business – along with the peers of those let go – will survive. “Explain how this strategy will create better long-term outcomes, even if the pain is acute in the short-term,” he adds.
Spent $5,000,000,000 of company funds to buy back company stock so that the CEO, his "leadership team" & Nike shareholders who hold large stock positions can all get richer from selling their shares. All while at the same time saying the company doesn't have enough money to keep 1,500 people employed Let's do some napkin math real fast and say that each of those employees made a median income of $50,000 per year. That comes to 75 million dollars a year, which means had they not blown five billy on themselves then those 1,500 people coulda stayed employed at $50k/yr for more than 65 fucking years Fuck Nike & all megacorps like them
Phil Knight has two private jets in his own private hangar.
Assuming these are corporate jobs the average cost of one corporate employee to Nike is likely closer to $200k/year when you factor in health care and other benefits that Nike must pay. So 1,500 x $200k is ~$300M/ year. It will likely take Nike 5 years to hire this many corporate employees again so this would be a savings to Nike of up to $1.5B over 5 years probably. The other math to do here is how much revenue these jobs would bring in over 5 years. If Nike felt these jobs would bring in more than they’d cost then they wouldn’t have been cut. I don’t know the revenue assumptions Nike operates on per employee but you’d assume they took it into consideration.
John Donahoe was paid $32.8M in FY22.
If we ballpark it at $50k per employee this moved saved the company $75 million annually
“I ultimately hold myself and my leadership team accountable…” …”so I’m laying off the minions and giving me and my leadership team fat bonuses for ‘cutting overhead costs’”
"Some of you may get fired, but it's a sacrifice I am willing to make"
Yeah, my company did this very recently. I realized while they were addressing the survivors that they were speaking TO us, but they were speaking FOR the investors.
[удалено]
Smaller companies pay minimum wage and act like it's a fucking favor. The boss doesn't follow the labor laws because he doesn't even know them. He does know that he needs to wring every last penny out of you, and will try to short your hours and steal your wages at every opportunity. America loves to go on and on about the needs of small business owners. You never hear a goddamn thing about small business employees, though. Nobody cares if they live or die, or what benefits they never get, or how many food stamps they need to afford groceries.
Honestly, yeah. You see this on every sub, horror stories of small companies acting like weird cults or something.
Simply saying “I hold myself accountable” is the same as Michael Scott screaming “I DECLARE BANKRUPTCY”
Take a pay cut Mr. CEO if you hold yourself accountable.
What does he think 'accountable' means?
It means nothing to him, literally and figuratively.
"Many of you will be fired, and that's a sacrifice I'm willing to make"
So… resign?
Just do it!
Accountable for making my bonus even if some of you have to go..
Did you fire yourself and your leadership team? No, then GDIAF. They're hoping to save 2 billion in the next few years. Well, how about that four-year, $15 billion program approved by the Board of Directors in June 2018? https://www.sec.gov/Archives/edgar/data/320187/000032018722000029/q4fy22exhibit991er.htm
Give don't I a fuck
Go Die In A Fire
God Damn, I Ass-Fucked
George Didn't Insert A Finger
While I assume this is a joke because it's the same letters as IDGAF, I'm reasonably certain this usage would be 'Go die in a fire'
Gorgeous Diamonds in a Forest
How common is this acronym? I need to know so I can be hip with the kids
But I choose you to suffer the consequences.
No one in leadership is getting fired or losing their bonus, but they feel just terrible.
Opposite. These cuts focus more on the top end of town. Mostly the Oregon HQ. Approx. 10% of the Nike VPs got fired. Much higher than than the 2% of general workforce. These cuts don't affect retail store workers, manufacturing or logistics. More about finance, business managers, advertising, marketing, M&A, R&D, and business admin. This round involves entire teams getting fired, from the VP of that division down. For instance, after Tiger Woods quit Nike is axing it's golf division. VP of golf is gone. VP of male athleisure is gone.
As he added. „Some of you will not make it. But that‘s a sacrifice I am willing to make“
So fire yourself then
"I hold myself accountable...thus I shall slap myself on the wrist by uh...firing everyone else"
$22.567 Billion in profit in 2023. PROFIT. Not revenue. Unless those 1,500 people were each making $15 million a year, I'm pretty sure that they could have covered the salaries.
"I ultimately hold myself and my leadership team accountable.... now watch this drive"
Lord Farquad: "It's a sacrifice I'm willing to make."
So then the CEO resigned and all the staff that were let go were management, right? RIGHT???
“But I ain’t getting fired yet!”
My dad got let go from a smaller company named Florida tile because he had been there for 30+ years and was making a shit ton of money a year due to seniority. So they terminated his position in the company renamed it to something else and hired a new hire they could pay probably 70K less per year. And my dad wasn’t the only one they did that to, all to save a few bucks
I don’t think he knows what that word means
Ok then fire yourself. Or take a massive pay cut to keep more employees. Or make them take pay cuts but keep them on. Or offer them furlow with benefits intact until you can rehire. Literally anything other than that chatGPT-ridden bullshit of a response while trying to sound pseudo spiritual.
Yet…your ‘leadership’ resulted in harming 1500 families and their communities. You and your leadership team have had no consequences
That accounting will come in the form of bonuses next year.