“I do not deny that the feeling of success makes it easier to enjoy life…. Nor do I deny that money, up to a certain point, is very capable of increasing happiness.
What I do maintain is that success can only be one ingredient in happiness, and is too dearly purchased if all the other ingredients have been sacrificed to obtain it.”
– Bertrand Russell
Category: Happy At Work
How to be happy at work
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Bertrand Russell on success
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Lego, making near-record profits, lays off 1,400 people – with no criticism from anyone
I am incredibly disappointed in Lego’s recent decision to lay off 1,400 staff even tough they have near-record profits. Here are the facts:- Lego’s revenue fell 5 percent in the first half of 2017 to 14.9 billion Danish kroner ($2.38 billion) compared with 15.7 billion Danish kroner in H1 2016.
- Net profit came in at 3.4 billion Danish kroner, compared with the first half of 2016’s 3.5 billion Danish kroner.
- They will therefore lay off 1,400 people – approximately 8% of the workforce.
Normally in a situation like this, I’d suspect leadership of doing layoffs to placate stockholders, but Lego is privately owned, so that’s clearly not the case here.
Crucially, the company is not losing money. In fact, even though sales have fallen slightly, profits are essentially constant and at near-record levels for the company, so it’s hard to see exactly what motivates this move.
What has really surprised me is that there has been no pushback or criticism from the financial press. It makes you wonder: What kind of a business climate are we living in when this kind of decision is met with nothing but approval from all observers?
I’m sure no one at Lego or in the financial press cares the slightest bit what I think, but I thought it was important that someone speak out against this kind of leadership. Hence this article.
Lego´s chairman of the board and former CEO, Jørgen Vig Knudstorp, says that the layoffs come because the company has become too big and complicated:
The way we do business, the way we do our marketing, the way we do our market management, but also how we run the whole administration of the company unfortunately has become too complicated as we’ve grown the company massively over the past 12 to 13 years.
That’s what’s really hindering us in executing in a strong way – as we used to – and therefore we are finding it harder to grow in some of our very well penetrated and established markets.
But if the organization has become too complex, you don’t fix that just by laying people off – you do that by fixing the organization. In that context layoffs may even be counter-productive. Trying to streamline your organization becomes a lot harder when you’re simultaneously laying off 8% of your staff and dealing with the ensuing organizational and psychological fallout.
Mostly I’m disappointed with the attitude towards employees revealed by this decision. Layoffs carry huge psychological costs for both those who lose their jobs and for those who remain and therefore they should be a last resort when all other options are not sufficient. In this case, lego clearly had many, many other options.
I see this move as a huge lost opportunity for Lego. They could have cemented their reputation as a good workplace that can handle a minor drop in sales and profits in a way that doesn’t make staff pay the price.
As a consequence, I have removed all mentions of Lego from my next book, Leading with Happiness. I’d included them in a couple of places as an example of a company where leadership cares deeply about its people – this is clearly not the case any more.
What should they have done instead? In my next book I share the story about a tech company that lost half their revenue and found a way to come out stronger and more profitable without laying off a single person. If a company can do that when it’s very survival is threatened, Lego could definitely have done something similar when they’re still incredibly profitable.
Related posts
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Leading with Happiness – my speech from the World Happiness Summit in Miami
At the World Happiness Summit in Miami I gave a 15-minute speech on Leading with Happiness – the same topic I’m covering in my next book.
In the video I share what’s wrong with traditional leadership and its relentless focus on business results and give some great examples of leader who create more happiness for themselves, their employees, their customers and the world.
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See all the fascinating talks from our 2017 Conference on Happiness at Work
We have now published all the amazing talks from our 2017 International Conference on Happiness at Work.
You can watch every single talk from the event above or at this link.
And if you think that looks awesome, join us in Copenhagen on May 17+18 2018 for the next conference. Sign up here to be notified when ticket sales start.
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Download a free pdf poster with great quotes about happy leadership
We have created a poster with inspiring quotes about leadership – you can download the pdf for free right here.
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Enter for a chance to win the 2017 “Out of Office” World Championship
Help us find the best out of office auto replies in the world!
Do you have a really good, funny or creative auto reply for your e-mail when you’re off on Summer vacation? Or what is the best “Out of office” reply you have received this summer?
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Everyone deserves a happy career. Here’s how to get it.
Time and again, we see a bell-curve response to surveys on workplace happiness – 20% engaged and happy, 20% disengaged, 60% in the ‘so-so’ zone.
Why don’t people pay a little more attention (and a whole lot more respect!) to their own happiness – and what happens when they do?
In this hilarious talk from the 2017 International Conference on Happiness at Work in Copenhagen Irish career expert Rowan Manahan will show you how to use happiness at work as a career advantage. Because the science is clear: While success is no guarantee of happiness, people who love their jobs are more productive, innovative and motivated and ultimately more successful in their careers and in life.
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Help me name my next book
I need a great title for my next book on Leading with Happiness.
The book explains why and how leaders should lead in a way that improves happiness for themselves, employees, customers and the world. Read more about it here.
So far I’ve just been calling the book Leading with Happiness (and that kinda works) but maybe there’s a better, more eye catching and more fun title out there?
As you know, business books tend to to have a title and a subtitle. Here are some titles I really like:
- Everybody Matters: The Extraordinary Power of Caring for your People like Family
- The No Asshole Rule: Building a Civilized workplace and surviving one that isn’t
- The Customer Comes Second: Put your People First and Watch’em Kick Butt
- The Lazy Way to Success: How to do Nothing and Accomplish Everything
The title itself is short and inspiring and the subtitle explains what the book is about.
So please give me your best ideas for a book title in a comment below.
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Why Ping-Pong Tables Wont Make Your Employees Happy – And What Will
In this animated interview Olivier Larvoir and I talk about:
- Which company recently installed a slide in the office to make it a ‘happier’ place to work (#facepalm)
- Why your employees don’t want free coffee, ping pong tables and away days – and what they DO want
- How to attract the best talent without writing a job ad or hiring a recruitment agency
- What happiest places work all do that you can implement today (think: Google, Zappos, Southwest Airlines)
- The one word most leaders are scared to say but is the key to better productivity (hint: it isn’t ‘motivation’)
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Ben Zander on Leading with Happiness
I interviewed the legendary conductor Ben Zander for my next book on Leading with Happiness and here is one of my favorite quotes of his:
Doing well in the stock market, or satisfying the shareholders is a natural byproduct of an effective business. And what makes an effective business is the same thing that makes an effective orchestra: People who want to be there, who give everything they have, who are having a wonderful time doing it, whose eyes are shining, who are giving out energy to people around them.
