Salesforce CEO Marc Benioff has recently admitted that laying off thousands of employees during a two-hour, all-hands meeting over a call was a ‘bad idea’.
The enterprise software company in January 2023 laid off 10% of its workforce. The downsizing impacted about 7,000 employees, amid the ongoing global macroeconomic conditions (better to call it a recession).
In an interview with The New York Times, Marc Benioff said, “We were trying to explain the unexplainable. It’s hard to have a call like that with such a large group and have it be effective, and we paid a price.”
Marc Benioff faced heat from Salesforce employees for allegedly being evasive during the meeting.
“I wish I offered lifetime employment. But the reality is when you have a big company with 80,000 employees, there are going to be times you have to make a headcount adjustment. Our layoff packages are some of the most generous ever,” Marc Benioff remarked.
Earlier in February 2023, several Salesforce employees came to know about their firing. Around 4,000 staffers disappeared from the company’s Slack channel within two days.
In San Francisco, the layoff round hit 258 workers, affecting “sales and customer service”, “technology and product” and “general administration”, according to a WARN notice.
In Ireland, 200 of the company’s 2,100 employees received their notices.
In the United States, affected employees will receive a minimum of nearly five months of pay, health insurance, career resources, and other benefits.
“Those outside the United States will receive a similar level of support, and our local processes will align with employment laws in each country,” Marc Benioff had said.
Marc Benioff further stated that he went to French Polynesia for a 10-day trip in wake of the mass layoffs.
“We are so addicted to our devices (at least I am) it’s very freeing to leave them all behind for a while!” the Salesforce CEO remarked.
The term ‘Digital Detox’ is used to describe a period of time in which a person refrains from using electronic devices, in order to ‘reconnect’ with nature, take a break from social media and de-stress from digital life.
Meanwhile, trouble mounted further for the enterprise software company as Twitter in January 2023 cut its contract for Salesforce’s customer-management software by 75%, to USD 5 million a year from USD 20 million.
The move came amid the top executives taking more control of software purchasing decisions from lower-level managers amid an ongoing recession. This trend has put pressure on products such as videoconferencing service Zoom and the work-chat app Slack, owned by Salesforce, which now must compete with similar services offered by Microsoft and Google.