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E-Layoffs: Efficiency at What Price?

For those who missed the recent story, executives at Radio Shack made headlines with the lay-off of 400 employees via E-Mail. In what once might have been considered a magical move, the Radio Shack folks figured out how to make 400 employees disappear simply by clicking on send. In so doing, they’ve added a new term to business vernacular: E-Layoffs.

FaxIn a memorable scene from the motion picture Back to the Future 2, Marty McFly, played by Michael J. Fox, receives multiple simultaneous faxes reading: YOU”RE FIRED! Most of us watching the movie found such an immediate, cold hearted, impersonal approach to be so off-the-charts, it was really funny. For those 400 Radio Shack employees, the scene was all too real and not too humorous. The real life e-layoff story strategically broke on a holiday weekend while much of the press was on R & R. Ironically, it was Labor Day weekend, proving once again that truth is stranger than fiction.

MikeyWhile I’m personally an advocate for improving delegation, this classic case of trickle down cowardice is one for the business case study books. What were Radio Shack executives thinking? Allow me to imagine their thought process. Do you remember the classic TV commercial for Quaker’s Life cereal with little Mikey?

“I don’t want to try it. You try it. Let’s have Mikey try it. He’ll eat anything.”

So might this be the Radio Shack version?

“I don’t want to tell them. You do it. Let’s have Zach do it. He’ll try anything.”

So he (or someone there) did. And apparently, they liked it. If it was OK for everyone else in Radio Shack’s executive food chain to be a coward, why not the last guy on the totem pole? We’ll call him Zach. Perhaps Zach is a hero among his peers. In an organization that values efficiency above all else, he should be a hero. Perhaps he gets a big bonus.


Don’t misunderstand. I admire efficiency. And, making 400 people disappear from the payroll with the click of a mouse is remarkably efficient. But what about the big picture (a.k.a. the future)? Will using efficiency as their primary criteria for decision making really help Radio Shack to reach greater heights? Or might this be penny wise and dollar foolish? I can’t help but wonder if those efficiency loving, emailing execs considered the consequences of their actions as they relate to…

The morale of those left behind as they check their in-box each day.

The company’s ability to attract top caliber people in the future. Might they now attract other cowardly executives as they’ve harbored that behavior?

Their potential customers who read or hear the story and now choose to drive past Radio Shack and over to Best Buy or Circuit City. Perhaps the frequency of this occurrence is the cause of the layoffs in the first place.

It’s time to resurrect Robert Hass’ quote to help us look beyond efficiency and reconsider effectiveness!

Everyone looks at the wrong end of the telescope, as if profits drive the business. Financial reporting doesn’t get to the real stuff – employee morale, turnover, customer satisfaction, on-time delivery, consumer attitudes, perceptions of the brand, purchase intentions – they drive the results. I believe that if you create an environment that your people identify with, that is responsive to their sense of values, justice, fairness, ethics, compassion, and appreciation, they will help you be successful. There’s no guarantee-but I will stake all my chips on it.

-Robert Haas, CEO, Levi Strauss.

Radio Shack has placed their chips elsewhere. Good luck! Those same folks who’ve traditionally asked us to make it a Radio Shack Christmas broke new ground on Labor Day.


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