Why Do Big Companies Get Rid Of Talented People?

A strange thing happened this year. A number of highly talented people I know were made redundant from the (typically) large companies they were working for. Good people. Capable, bright, knowledgable people. People skilled in digital and who were willing to challenge the conventional ways of doing things in order to find a better way. 

This makes little sense to me. I recently worked on a fascinating piece of research on behalf of the smart folk at Econsultancy into how organisations are resourcing their digital marketing capability. One of the findings was that companies are finding it increasingly difficult to find talented people with both a depth and breadth of digital skills and knowledge. And yet some people who seemingly have all the skills and attributes that you would *think* would be highly prized by organisations (particularly those looking to adapt to the challenges brought by digital and emerging technologies) have been 'let go'.

In a recent post Rishad Tobaccowala defined strategy as 'Future Competitive Advantage', and described the two biggest challenges for firms seeking to deliver on a strategy as being to address their organisational design (processes and products that are optimised for existing customers) and their talent (attracting new skills, or up-skilling, and building out new incentives).

Despite talking a good game, many large organisations remain relatively poor at moving talent around the company. The silo culture that still characterises many businesses doesn't help. Requirements and expectations become optimised to local needs rather than those of the organisation as a whole. Strangely, the people who can really see the bigger picture and are often the ones to challenge existing assumptions are the ones that begin to not fit so easily into those silos. So companies take the easy option.

In my view, it's their loss. As Rishad says: "Strategy has a better chance of becoming reality if we keep in mind that the future does not fit in the containers or the mindsets of the past." That applies as much to talent as it does to business models. But sometimes finding the talent of the future is less about talking to headhunters and more about looking right under your nose.

Comments

[Rayna]

Interesting post, and I, too, have observed this occurring more often. Do you sense this behaviour is more exclusive to agencies rather than on corporate side?

[neilperkin]

@Rayna Thanks. Actually I had in mind more the corporate side rather than specifically agencies, but it would be interesting to know if the same is true there

[Stan Lee]

This piece really struck a chord with me Neil. In fact it sums up the first two thirds of my 2011.

The last couple of months however have proven that big companies have no bloody idea and that I am every bit as talented and relevant as I always thought I was.

Here's to kicking against the pricks in 2012 and beyond!

[neilperkin]

Good for you Stan :-). All the best for a great 2012.

[Dan Thornton]

Nice question to ask, and it's something I've seen a lot.

I do wonder if in addition to the organisation challenges, it's also the case that talented and skilled digital people also have a habit of missing the traditional office politics that keep less-talented people in management positions that ill deserve.

There's something in digital culture which leads most of the people I know to focus on solving problems for the good of the business as a priority, which should benefit their careers, but often seems to hinder them...

Mind you, there also seems to be a growing movement of talented people giving up in frustration and jumping out on their own, which isn't necessarily a bad thing!

[neilperkin]

Interesting point Dan. Something here about a difference in priorities definitely. All the best for 2012 to you and yours

[Fish Resurrected Reposessed]

Are you interested in Chinese Feng Shui? Sometimes it provides explanations for career setbacks – redundancies in individual people’s lives. As you are so interested in big companies you will be very interested in watching this feature documentary: http://www.fisheadmovie.com/where-to-see There is a generous number of shorter clips about corporate human resources too.

[Joanna Pieters]

I'm totally with you, Neil, on this. The fervour for headcount reduction is about immediate results (redundancy payments being budgeted separately to allow the P&L to show improvement) and being seen to be doing something. The industry-wide problem of recruitment/retention simply isn't causing enough measurable current pain to organisations to outweigh the demand for immediate cost cutting. It's not just digital: I've seen very talented people in all areas being got rid of because their role was relatively straightforward to cut without causing immediate pain. The pain will come later, of course, but by then either the current decision makers will have moved on, or up, and there's always something else to blame: the economy, the shortage of students on the right courses, the managers of a few years ago. In many cases, the ultimate problem is probably shareholder culture and short-termism, which is transmitted down the organisation down the path of least (immediate) resistance.

[IT Consultants]

I agree with most of the points you make within this content.