Why Google May Use Performance Management System to Lay Off Underperforming Workers in 2023

According to reports, the multinational internet giant Google has implemented a new performance management system that might result in the firing of thousands of failing employees. This comes as large firms examine layoffs and a delay in hiring as a strategy to increase their profits.

A new performance management system that will be unveiled early next year may enable human resource managers to fire underperforming Google employees, according to a report by the information. The tech journal also asserted that Google’s management can decide not to give employees incentives and stock options based on their performance ratings.

Google Performance management System to lay off workers

According to the Information, which cited sources with knowledge of the new system, “under the new approach, managers have been instructed to label 6% of employees, or around 10,000 people, as low achievers in terms of their influence on the business.”

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According to a report by The Information, the new technique of identifying the 6% of workers who perform the worst will first permit managers to withhold bonuses from them. The same performance management system had previously demanded that managers only recognize the worst 2% of workers.

According to the information, managers will be able to assess team members and consequently organize bonuses and stock grants with the aid of the rating option in the new performance management system. Therefore, managers will be able to rate employees or decide not to give them bonuses if they are discovered to be lax at work or not exerting themselves.

Sundar Pichai about layoffs

Alphabet, the parent company of Google, has not formally announced any layoffs. However, the CEO Sundar Pichai hinted about impending layoffs a few months ago.

Pichai stated, “We want to make sure as a company when you have fewer resources than before, you are prioritizing all the right things to be working on and your employees are productive, that they can actually, have an impact on the things they’re working on, so that’s what we are spending our time on,” in a speech at the recently held Code Conference in Los Angeles.

In the same conference, Pichai also referred to microeconomics and said that the company has slowed down as a result of hiring more people. We feel more unsure about macroeconomics the more we attempt to comprehend it. Advertising and consumer spending, among other things, are tied to macroeconomic performance. We sometimes take longer to make decisions in all of our endeavors. You look at it from beginning to end and determine how to increase corporate productivity by 20%, the Google CEO remarked.

Like all other IT companies, Google hired numerous people in the wake of the pandemic but is currently experiencing several financial difficulties. Pichia had earlier issued a warning to those who did not take their jobs seriously. He added that those who do not take their jobs seriously will have to deal with significant consequences.

Other Company Layoff

“Google has stood out by not making any job reductions thus far as layoffs have swept throughout Silicon Valley. However, as external pressure on the corporation to increase worker productivity grows, a new performance management system might assist managers in letting go of thousands of unproductive workers as early as next year, according to the article.

Approximately half of Twitter’s 7,500 global employees would be laid off once Elon Musk became the microblogging platform’s new CEO.

The New York Times also reported last week that Amazon also intended to let go of 10,000 workers in corporate and technical positions. The largest cuts in the history of the corporation, according to the report, would be made. Approximately 11,000 employees, or 13% of its global staff, will be let go by Meta, Facebook’s parent company, according to the announcement. The 18-year-old social media behemoth is undergoing its first mass layoff program.

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