As we all know, the economic downturn is causing most companies to significantly reduce fixed costs with Best Buy being no exception. As part of our restructuring, recently, we offered essentially all corporate employees (about 4,000 people) the opportunity to accept a “voluntary separation” package. This package provided a lump sum payment and other benefits based upon level in the organization.
As one would imagine, there were a range of emotions regarding this package. For me, I was proud that the company’s most senior leaders afforded everyone an opportunity to “do their own sort” on how personal goals and a career at Best Buy fit together. I thought of it as sort of a “reset’ moment where individuals were able to either affirm their desire to be at Best Buy or leave knowing that something else was out there calling them.
The deadline for accepting the package was January 5th and 500 or so people accepted the offer. The days leading up to Jan 5 were surreal as all of us at the same time literally, were thinking about our career choices. I heard many great stories from those who decided to leave including the opportunity to be home more often with young kids, the chance to start a business, the ability to be with a sick parent, the ability to switch careers and teach and finally just a chance to do something different. As we have yet to make the results of the package public, I have also heard many rumors about my decision. In my personal sort, I decided to remain with Best Buy. My reason were many including my belief in the company’s strategy, our track record of success, my loyalty to both the people who I have been leading in Marketing and to Brian Dunn, as well as my personal need to remain in the Twin Cities so as to be near my kids and friends. In the end I really like working at Best Buy and I don’t think there are many better jobs out there for me.
I do have to say though that the day we all declared was a very, very sad day for me. Several people that I had worked closely with for many years and had developed deep respect and affection for, decided that they were moving on. That day (and week), I felt a deeper sense of lost than I think I have ever felt and frankly, I wasn’t ready for that emotion. The losses have sunk in and I feel better now. I know we will all be different because of what happened but I also know, what happened had to, and that we will be stronger, both as individuals and as a company as a result.
That’s my story. Please weigh in, if interested in providing feedback or your story,
Do you think this kind of buyout wil cause Best Buy to lose some of its best people since they will have more opportunities in front of them?
How will this affect the company long term?
Barry,
Thanks for sharing this story. We just underwent a small lay-off at SHIFT, and as both an employer and a friend to many of those we needed to let go, I can empathize with the sense of loss you’ve experienced. It’s a tough environment.
Either way I laud you, and BestBuy, for the transparency of communications like this one. I actually planned a quick outing to BB this afternoon. I feel even better about it now.
Thanks for sharing this, and congratulations on your decision. I only wish other companies could respect their employees and their own staffing standards enough to make such an offer. I imagine, those who remain are also committed to succeeding as a team in the tough economic times ahead. Too many take the easy way out, simply slashing and burning, leaving an indelible mark on people and their brand.
This kind of honest communication makes me happier with a brand/organization I already liked. Good job, Barry.
It is a tough thing to see long term associates leave, the question is how can you help them find a job to thrive in while still connecting with your company. How could it benefit you both to have them work at a supplier or strategic partner? Times are tough all over but there is much to gain in the down turn. Great example of how to deliver a difficult message with candor and the admiration that comes of it…
I concur with the notes above. This kind of candid, frank and personal communication about a bad news situation from a corporate executive is to be applauded and shared far and wide. BB continues to earn my patronage and confidence. Bravo and best of luck!
Barry,
I, for one, am glad that you decided to stay. I believe in you and this company. I am confident that the tough decisions being made you and other members of the Best Buy executive team will allow us to survive this tumultuous economy and be better positioned for success when conditions change.
Thanks for your sharing your thoughts about the voluntary severance program. I think we’re all going to have a difficult time saying goodbye to our colleagues who are moving on to write new chapters in their life stories. So many of those folks are more than just co-workers, they are friends.
You are navigating us through the whitewater using Best Buy’s values as your guide. and your integrity and humanity as your compass. For that, I am particularly grateful.
Sue
Barry,
From a Recruiter and HR perspective there has been a lot of interest nationwide on how Best Buy has gone through the process. While never an exercise a company wants to do there is a lot of respect being shown to Best Buy for taking care of the employees and for being as public as possible.
As a Minneapolis guy I am very appreciative that the local company has done what it can for the employees.
Great perspective on this difficult decision that we all made. I too commend Best Buy for offering every employee the opportunity to re-evaluate their life and career. It truly is in line with our values and identity as a company. I also commend every employee on their decision, no matter how they chose to move forward from here. For all of us, this day brings a great sense of hope and optimism about a better future.
There isn’t any easy way to let people go. There isn’t any easy way to see people leave. And it should always feel surreal or one becomes inured. I’ve watched other organizations go through similar challenges – in some cases, convulsions – and it strikes me that Best Buy is handling the separation of employees from the organization about as well as possible.
Thank you for this honest and open communication, giving us a look at the inside of an already much-admired company. Managing layoffs is always difficult, as much so for those impacted as for those who are left behind in the workplace. These “walking wounded” are often left feeling guilty that they somehow escaped the ax while other didn’t and have genuine worry about how their friends and former colleagues will fare without the job. Offering up opportunities to reassess things and make your own choices about leaving helps to take some of the rough edge off of this situation and makes the healing process a little bit easier to manage. Thanks for your insight and willingness to share your very personal experience.
I’ve been with BBY for less than a year — so it would have been easy for me to say I don’t have much vested in this company so, thanks for the cash I’ll just go work at (insert company name here). If I worked somewhere else that might have been an easy choice, but from day one there has always been something different and special about Best Buy.
After the announcement of voluntary packages I spent quite a bit of time weighing both options, one day leaning towards staying and the next leaning towards moving on. Then the openness and honesty of our leaders in the Town Hall, reaffirmed that I made the right choice when I came to BBY and I was making the right choice by staying. The one thing that really resonated with me and brought back my optimism for the future was Kal’s comparison of BBY to a startup. There will be difficult and challenging times ahead, but its these times that bring out the best in us. We’ll be forced to be more agile, more innovative, find more efficient processes, to evolve at what may seem to be an uncomfortable level. But, its this challenge ahead that gives me energy and the desire to take it head on.
Declaration day was indeed a very sad and surreal day. Each hour you learned of another group of peers/friends/mentors leaving, and it started to wear you down. But, then as you started to hear peoples stories and their excitement about the new chapter their were starting in their life you couldn’t help but share in their excitement.
Barry — I will second your sentiments — I’m also very proud to be a part of a company that values and respects its employees to this degree.
Kudos to you for walking the talk. Integrity is defined by what you do when nobody is watching and there are many effective managers that would have gone about their business and never said a word. Best Buy has been positioning itself around its values and its determination to be more than a retail store, to be a valuable partner to its customers, its employees and its community. The approach you’ve taken, and quite frankly the candid, authentic and transparent approach that you personally have demonstrated for months leading up to this have not only helped to make Best Buy better, but have made Best Buy a truly attractive place for great people to want to work. We are living in a time where hope and inspiration are the most valuable currencies and you continue to provide both.
Great job Barry; Best Buy is extremely lucky to have you and Brian helping them to grow through the next evolution.
Voluntary severance program is common practice in the Netherlands, my home country. The name we use for it is a social plan. And that is what it is. Social.
One of the downfalls is that often the most equipped workers take the package, because they have the most opportunities to find another job. And the less flexible stay with the company.
AbnAmro bypassed that problem by assigning 10% of the people unmissable. They weren’t offered the voluntary severance.
Downfall of that solution is that the other 90% felt miserable. Motivation dropped rapidly.
But bankruptcy is no alternative.
Anyway, I wish you and your college’s all the best!
[...] Barry Judge » Blog Archive » My Thoughts On Best Buy’s “Voluntary Separation” Package [...]
A nice move on Best Buy’s part, but still a tough day for many I’m sure.
When I saw Best Buy doing this, I was shocked. It is the best thing any corporation has done in the current economic environment. If people are willing to take the package and leave, they probably would have taken it later from a head hunter. So, Best Buy reduced costs and removed people who didn’t bleed blue and yellow.
As Jim Collin’s said in Good to Great, a good-to-great company needs to get the wrong people off of the bus and Best Buy may have done just that.
[...] Original post: Barry Judge » Blog Archive » My Thoughts On Best Buy’s “Voluntary … [...]
[...] Barry Judge, our Chief Marketing Officer blogged about his perspective on the package (read it here). I think he wraps up most people’s feelings who decided to [...]
Great leadership and courage – well done! It is this level of transparency that will build trust and engage employees who want to stay. For those that chose to move on, good for them to take control of their own destiny as well – we do create our own happiness and success in the end. I admire your approach Barry.
I applaud the decision and the way that you handled it. Kudos to you and all involved Barry.