Patrick Shaw’s Weblog

I’ve been thinking a lot about the layoffs happening all over the world, brought about by a combination of the economic crisis and the ensuing environment of fear. I don’t have a great list, but a quick web search tells me that:

• Bank of America announced plans to cut up to 35,000
• WaMu: Most!
• Dell: 8.800
• Citigroup: 50,000

The list goes on and on. But nowhere am I seeing the rest of the story. For instance – what services are being cut to accommodate these layoffs? If there aren’t any service cuts, then I’m left with the impression:

• These agencies were obese – fat with people performing work that wasn’t needed
• These agencies are going to provide fewer services
• If these agencies don’t trim services – their product offering/customer service will drop

Maybe I’m wrong about all of these things. I’m keenly aware of step costs – you know – I can fit 10 people at the dinner table and feed them with a single turkey – but when I invite that 11th person – I need another turkey and another table – and I won’t utilize much of that second turkey or table. So – maybe it’s just that at that size – you can trim that number of people, go down a step, and be at business as usual, but with less business.

For years (and years and years) the nonprofit sector has been told that we need to behave more like businesses. And I think there is some truth to that – we should gather data and analyze it, we should evaluate our work, we should ensure that our overhead remains as low as possible and so on. Solid budgets, strong business acumen, salaries that are based on work product – the list goes on. In my career at nonprofits –I’ve found that most agencies are doing those things already. Maybe we can do them more effectively – but they aren’t absent.

So – how come I’m not hearing about nonprofits reducing their staff by huge margins? Is it because we aren’t fat? Is it because we’ve managed our growth well? Is it because we aren’t newsworthy? I know that some nonprofits are closing their doors, and still others are trimming entire programs. But I can understand both of those things – because a reduction in staff ought to mean a reduction in services provided. That means nonprofits are focusing on what they do best. But huge reductions in staff without an accompanying reduction in service? I’m mystified!