Tech layoffs and baseball

The business of baseball and the business of technology are, in many ways, alike. Both types of organization are trying to assemble a balanced but elite team that ultimately dominates their industry. Each pays the “appropriate” amount for the talent that could get them there. The simple difference is the number of humans that can hit an 84MPH curveball after seeing a 100MPH fastball or throw that 100MPH fastball are scarce. That makes them a sought-after prize. Where else can you get paid an average annual salary of $4.41 million?

Compare those elite 975 employees that play for the 30 Major League Baseball teams to the millions of tech workers on the planet. At one point, their skills were needed – necessary even — and they were swallowed up into companies like DoorDash, Twitter, Facebook and Shopify. Assembled into teams, paid well in cash and options and sent on their way to help contribute to the success of the company.

The biggest difference is their approach to winning:

Baseball organizations — for all their faults — have a recruiting process that mostly works. It limits the number of players in the pool and, each year, forces ball players to be better and better to achieve stardom. Tech casts a wide net, over-hires and hopes.

Baseball nurtures their talent if you make the cut. Tech cuts the talent when times are rough.

Baseball builds teams with a cause but are only allowed a certain number of people per team. Tech hires everyone and hopes.

Baseball doesn’t lay off their team during an economic downturn. Salaries don’t go down. Ex team mates don’t share condolences on LinkedIn for other players who have been fired. No docs circulate with “great and talented” people for consideration.

You see where I’m going here — it may be far-fetched to compare baseball teams and tech companies but how can we be ok with 10’s of thousands of people being considered “extra” to their companies and being laid off? Without remorse. Without penalties. When a baseball team fails to live up to their promise, the leaders get fired. How do we not hold up our tech leaders to this standard? While it isn’t criminal to hire too many people, it is a complete failure on the management that did this. Think of all the wasted time, money and effort (and more money on gracious exit compensation) all for zero value to the company?!?

Over hiring can happen but if you have to fire over 88000 people collectively in one moment to correct it, that is not over-hiring, that is bad management.

Can you imagine your favourite team, in any sport, reading the Wall Street Journal and then deciding to fire 13% of their team like Facebook did in 1 day? Nope. The behaviour of boom and bust that we’ve become accustomed to in tech is NOT normal but we’ve normalized it. How can we accept that humans have become the collateral damage of bad management?

We shouldn’t.