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On Monday, Google’s CEO told employees that job cuts were made in order to act decisively as the company’s growth slowed.
Sundar Pichai, CEO of Google parent Alphabet Inc., said in an internal meeting that he had consulted with the company’s founders and board before deciding on the 6% cut, according to remarks reviewed by Bloomberg.
“We can compound the problem and make it much worse if you don’t act clearly, decisively, and early,” Pichai said. “I had to make these decisions.”
Google announced on Friday that it would lay off approximately 12,000 employees, becoming the latest tech behemoth to cut back after years of rapid growth and hiring. Although the layoffs had been rumored for months, they came as a surprise to some employees. When they couldn’t access corporate systems, some realized they’d lost their jobs. Pichai, on the other hand, stressed that the cuts were the result of careful consideration.
It was not at all random, he claimed. All senior vice presidents and above will experience a “substantial drop” in their yearly bonus this year, he continued, because bonuses are linked to firm performance and leaders must be held accountable.
According to Fiona Cicconi, Google’s chief people officer, in a meeting with employees, the size of Google’s workforce forced executives to keep the circle of decision makers relatively small.
“In an ideal world, we would have informed managers, but Google employs over 30,000 people,” Cicconi explained. “We wanted to provide assurance sooner.”
Another executive stated that severance packages were designed to reward employees who had worked for the company for a long time.
In the meeting, Alphabet Chief Financial Officer Ruth Porat stressed that the cuts were intended to free up funds for the company to continue investing in key priorities.
Porat said, “If you act early, you create the potential to invest for long-term growth. As painful as this was, those were the key lessons.
