The recent period in the hi-tech industry is marked by reductions and efficiencies but it is precisely in this period that young employees at the beginning of their careers should be given an opportunity for their potential skills to be added to the set of considerations in the company’s efficiency work-plans and management plans.
Crises by their very nature push disadvantaged populations out of the field, both in life and even more so in the high-tech jobs market. Naturally and intelligently, the sword of downsizing cuts first into the flesh of those whose value curve to the organization is the lowest at the current and immediate point of time, but this is only a short-term view. It is important to return and look at the great crisis of the 2008 recession as a case study and learn what organizations should not do in terms of human resources in order to emerge from the current 2022’s crisis stronger.
Economic terms and buzzwords from the past few weeks, such as inflation, recession, slowdown and interest rate hikes, are like a launch shot in a race for competitive runners, which marks the beginning of the race for efficiency in the high-tech industry in particular and in most industries in general. Employees lists and rankings which are managed by the less smiling managers in the human resources departments and layoff discussions in executive management meetings, produce reduction efficiency plans for the high-tech companies and the first ones on these lists, mostly, are the students’ employees and junior positions at the beginning of their careers path of their future in the industry.
The math on this topic is horizontal and flat and mostly binary, it’s a game of one or zero, whether to preserve or whether to release the employee. The calculations are between the alternatives. Some of the alternatives of the high-tech companies are the possibility of recruiting professional and salaried personnel overseas, and some of them are a waiver of development and the implementation of content and features in company products or exporting work packages to other subcontractors in the industry. One thing is clear from all of these, no matter how we turn it around, there is a losing side and there is a more efficient side in the game and this is the nature of the market.
EVEN THOUGH the situation in the market is unstable and new hires have even stopped in many hi-tech companies, it is worth taking a look into the past and comparing it to the current crisis of the hi-tech industry. Learning from the past is even worth more than ever. When you look at the crisis of 2008, you can see that quite a lot of the industry’s laid-off employees in this crisis are now the current leaders of the industry in 2022. Those who experienced firsthand the scars of giving up on the unskilled and inexperienced workforce, grew, survived and succeeded and today are the leading layer and the actual leadership functions of the Israeli high-tech ecosystem.
In the Book of Psalms, the words of King David in his old age are quoted, “I was a youth and I am old and I have not seen a righteous man forsaken and his seed begging for bread.” Many years have passed and the Kingdom of Israel and the Kingdom of Judah have become the start-up nation and still, there is a lot of experience and meaning in the concept that juniors work at the beginning of their path in the industry and who deliver results and demonstrate a positive learning curve. Improvement and potential are assets and are quality human values for organizations. Companies can and should build their core and future leaders with the understanding that the market will change and the company, in turn, will also change and eventually will grow stronger.
Just before companies press the layoff trigger, it is recommended to take a deep breath and add the potential section to the basket of HR considerations. Organizations that are able to step aside from the generic route of the optimization processes and think in this stressful and unsteady time about the day after, will profit with compound interest.
There is also a message for the younger generation, the market has passed into efficiency mode and the celebrations of the growing bubble in organizations are over. Those who want to be involved in the industry and grow, must give the extra mile, and show output and potential. If the industry behaves this way, the younger generation will be profitable in the long run and moreover, the local high-tech industry will benefit, as well.
History always repeats itself, often in waves. The juniors of today will inevitably be the CEOs and leaders of the industry tomorrow. The hi-tech industry is the leading engine of the Israeli economy and the current crisis in the global economy in recent weeks is a golden opportunity, right now, to believe and invest in human capital. This is a basic market economy rule for both local and global markets at the same time.
The writer is the CEO of Asgard Systems, a technological innovation company that specializes in artificial intelligence applications and multidisciplinary engineering.