

The Strategic Imperative Not to Hire Anybody - coolnewtoy
http://blogs.hbr.org/cs/2010/05/the_strategic_imperative_not_t.html

======
j_baker
"For about five years now, particularly after dinners that featured wine,
human-resources executives have been telling me, "We've come to realize we
don't really want most employees for the whole of their careers. We want their
particular set of skills when we need them — but then things change so fast,
we don't need that particular skill set any more." And many of these are
companies famous for being good at H.R. "

Maybe I'm just old fashioned, but the solution would seem to be not hiring
people based solely on short-term requirements. In other words, hire people
that are good no matter what the requirements are.

But then again, this _is_ HR departments we're talking about.

------
gamble
"We've come to realize we don't really want most employees for the whole of
their careers. We want their particular set of skills when we need them — but
then things change so fast, we don't need that particular skill set any more."

But job-hoppers are still evil, right?

------
ovi256
>My clients were amazed by how much productivity they could squeeze out of
their people in the downturn.

Overworking only works for a few months, after which people's health will
start to suffer. All these managers are deluding themselves if they think this
is going to keep on indefinitely. OTOH, if some people were underworked and
they are just starting to pull their weight, that's another matter.

~~~
robrenaud
If you can make your employees more productive, I would think you would want
more of them, to capture more of the market. That is, if employee output
increases, but the cost per employee are constant, you are better off hiring
more employees until the marginal output of the next employee reaches the cost
of that employee.

But what do I know, I am just an engineer ;).

~~~
btilly
You're assuming a far more direct relation between consumption and production
than actually exists.

If I can sell 10,000 widgets for $100 each that doesn't mean that I can sell
1,000,000 widgets at the same price. And if I try to produce that many widgets
in the hope of selling them, I'm liable to drive the price of widgets down so
far that I'll lose money on all of them!

In other words while the auto industry could produce more cars than anyone
wants to buy, it would be a really, really bad idea for them to do so.

In production there is a point of diminishing returns. And after you're at
that point, increased productivity frequently results in cutting back people
to return production to an optimal level.

~~~
robrenaud
I was talking about behavior of employers on the margin, not about increasing
employment by an order of magnitude.

Certainly I agree that my argument is limited by changes at scale and also
only applies to individual companies within an industry rather than entire
industries as a whole.

On the other hand, if Chevy gained a competitive advantage and could produce
cars say, 10% cheaper than they used to be able to, it would usually make
sense for them to produce more cars, potentially selling them for cheaper. The
car industry as a whole still couldn't sell many more cars, but the Chevy
would still be better off, taking some market share their competitors.

On the other hand, I think the implicit assumption in the article is that the
recession shocked the economy and there was a significant drop in demand. Even
if Chevy realized some efficiency gains during the recession, they are still
better off cutting production and letting those efficiency gains limit
workforce size because the demand curve changed.

------
nkassis
We you can't fight them join them. I guess the best option is to own a company
instead of working for one. I'm pretty much preaching to the choir here but
it's worth mentioning

~~~
kirill_blazhko
Unfortunately not everyone is carved for the entrepreneurship. The end of the
article mentions this very category of people and I agree with the author:
something must be done to provide jobs to those people.

------
emmett
Very similar to the arguments of the Luddites: The power loom is putting
workers out of a job!

Some attempt to do something which gets the unemployed back to work could be
good, but trying to create make-work by using more people than a job requires
is not.

~~~
kg
I'm definitely not in favor of creating needless jobs, and companies that can
be creative and do more with less in a sustainable fashion (without creating a
poor quality of life for those doing it) should be rewarded. That being said,
overworking people and pushing them aside when they fall out of fashion is
short sighted and will create long term problems for society as a whole.

~~~
ovi256

      will create long term problems for society as a whole.
    

Even worse, it creates an externality, a debt that society will pay for the
corporation.

~~~
yummyfajitas
What externality does increased productivity cause?

------
j5eb6ach
We have a situation of 'haves' and 'have nots'. A corporation of 100 employees
has every reason to prefer that those employees work at 120% (50 hrs/wk).

Our society would benefit if instead the corporation hired 20 additional
employees, and everyone worked at 100%.

~~~
btilly
Your math ignores retraining costs. A corporation of 100 employees that hires
20 more will in fact temporarily have just created extra work for the existing
100 for some time before they see a benefit from the hires.

And given normal turnover, retraining would become a higher portion of that
corporation's costs permanently, resulting in permanently decreased
productivity.

~~~
petercooper
It forgets wasted time, too. In most situations that are not manual labor, you
can't just trim 10 hours from one person's schedule, give them to someone
else, and expect equivalent or better performance. In most clerical positions,
time is spent accumulating knowledge, socialising, and waiting for process
related bottlenecks.

------
karzeem
Is 0% unemployment a good end in and of itself? Sometimes industries go
through changes that reduce the number of people required to get the work
done. It seems like if you're too aggressive about driving unemployment to 0,
you end up with all your companies looking like GM.

That isn't to say that unemployment is desirable, and at current levels, it's
almost certainly destructive. But the measures required to take unemployment
from, say, 2-3% to 0 may cause more harm than good.

~~~
petercooper
Total employment is certainly bad from a productivity POV. For a better
overall level of production, it's necessary for any system (even one as large
as the entire labor market) to have some idle capacity to cope with growth and
expedition.

That said, this is an economic standpoint, rather than a social one, but
hopefully I'm not being too opaque with my bias :-)

------
j_baker
Doesn't seem to be working for me, but the mobile version does:
[http://m.hbr.org/12763/show/c66232388036dd9da4780e91b5bbdb0c...](http://m.hbr.org/12763/show/c66232388036dd9da4780e91b5bbdb0c&t=54114d0202b0d5685a50248ba19888bb)

------
pw0ncakes
Since 1975, the upper class has done a great job of making sure the proceeds
of economic growth and progress go mainly to them. Increased productivity is
good only when the benefits are shared.

~~~
petercooper
By "upper class," are you referring to the rich? If so, you're noting that the
rich are doing a good job at staying rich. That's unsurprising because they
can take bigger risks without losing their shirts due to their wealth buffer.

In the recent Sunday Times Rich List (of the top 1000 richest people in the
UK), 751 were "self-made" with only 249 having inherited their wealth. Most of
the billionaires had humble beginnings. There is no defined "upper class" or
level of wealth that's impossible for people born into the least economically
beneficial situations to attain.

~~~
pw0ncakes
No. Rich does not mean upper class, and upper class does not mean rich. The
two factors are strongly correlated, but not the same thing.

The upper class is a tightly-connected group of people who work to consolidate
power, social resources, and wealth within their own ranks. Most of them are
parasites and a lot of them are criminals whose politics are regressive.

Most rich people are technically upper-middle class. In fact, if you weren't
born upper-class, upper-middle is as high as you can go (your children and
grandchildren have a shot, though).

~~~
petercooper
_No. Rich does not mean upper class, and upper class does not mean rich._

I had to ask (and semi-assume) because, generally, "upper class" is based
significantly on wealth and fame:
<http://en.wikipedia.org/wiki/American_upper_class>

Your definition seems to cover a more conspiratorial and political superclass
(perhaps in an old European sense of "upper class"), and while I believe an
insidious old-boys network of sorts exists, it can't be confused with the
typical rich "upper class" that isn't inaccessible to newcomers.

~~~
starkfist
From other posts I've surmised that pw0ncakes lives in an Edith Wharton "Age
of Innocence" version of New York with the scenes and characters updated for
modern readers.

