“I sincerely doubt employees who fear that they may be laid off will be able to develop software titles that could impress people around the world.” – Satoru Iwata
Less than 72 hours ago, 800 employees of Activision Blizzard lost their jobs after a earnings report was released. Despite the CEO stating that 2018 was one of their strongest years, best in the history of the company even, hundreds of employees across the spectrum had lost their jobs. A studio within King shut down, leaving their game(s) incomplete, crippled even.
But, it also has shown just how much passion the gaming industry and the community can come to help one another. It also let a lot of former Activision Blizzard employees vent their frustrations when how the company handled their situation. There’s been open letters, statements, and social media posts about how devastated they and those they’ve influenced have been.
Among those came a reminder of something I once read, something that stood out over all the years. A practice only one great man and his esteemed colleagues did. In 2013, following poor sales of the Nintendo 3DS, the late Satoru Iwata had announced that Nintendo would not be laying off their employees amid the companies restructuring to better suit their situation.
Instead, Iwata took a fifty-percent pay decrease, putting him well below what most corporate suits make at the end of the day. A move that, in the long run, benefited Nintendo and helped launch them into an unforeseen success of the Nintendo Switch many years later. A success that Satoru Iwata may have already foreseen before it ever happened.
When asked about it during the 73rd Annual General Meeting of Shareholders Q&A, Iwata-san admitted that it was true that Nintendo was aware that they had their ups and downs over the years and that their ideal situation is to make a profit even during their low periods, returning profits to their investors in order to keep their share prices up.
He continued on to discuss the most important part. Why they didn’t cut back their number of employees working at Nintendo, ” If we reduce the number of employees for better short-term financial results, however, employee morale will decrease, and I sincerely doubt employees who fear that they may be laid off will be able to develop software titles that could impress people around the world. I believe we can become profitable with the current business structure in consideration of exchange rate trends and popularization of our platforms in the future. We should, of course, cut unnecessary costs and pursue efficient business operations.
I also know that some employers publicize their restructuring plan to improve their financial performance by letting a number of their employees go, but at Nintendo, employees make valuable contributions in their respective fields, so I believe that laying off a group of employees will not help to strengthen Nintendo’s business in the long run. Our current policy is to achieve favorable results by continuously cutting unnecessary expenses and increasing business efficiency. Thank you for listening.”
Profoundly enough, it made me wonder why other companies don’t view their employees like this. Not just in the video games industry, but around the world, in any industry for that matter. Now, Nintendo is doing better than ever before. They’re honestly doing better than better. They’re doing astonishingly well.
That same approach could have done rather well for Activision Blizzard, giving each and every single employee affected by the layoffs a chance to make bigger, better, and bolder moves further down the line. As Iwata-san said it rather well, “employee morale will decrease, and I sincerely doubt that employees who fear that they may be laid off will be able to develop software titles that could impress people around the world.”
Truth is, it has, and it’s noticeable that morale is at a potentially all-time low. Those affected have been crushed, their dreams shattered, and some even having to figure out how they will take care of their families, their friends, and those affected. We, ourselves, have even gone as far as to help build a resource for those affected. A consequence that it seemed was not taken into consideration when the cuts were made.
Many had even reported on the very fact that last year was a rather successful year for the company financially and that they saw bigger returns than ever before. Additionally, the companies stock even made a rebound hours before the layoffs were announced, seeing as much as a five dollar and some change growth Monday at closing.
Bobby Kotick, CEO of Activision Blizzard, even stated “while our financial results for 2018 were the best in our history, we didn’t realize our full potential,” during their 2018 earnings report released on Tuesday morning. That same day, the company laid off around roughly 800 staffers. It doesn’t stop there though.
Activision Blizzard has more than 9,000 employees who helped create and develop some of the most beloved games along with their communities in the history of gaming. How many jobs could they have saved had they all taken a cut to save those 800 or so jobs? A lot. They could have taken a note from Satoru Iwata himself. While he did make roughly $700k a year, he cut that in half, he cut that in half to save jobs. Not just him, but his entire board did. They all sacrificed hundreds of thousands of dollars to keep the jobs there.
They didn’t just keep jobs in development sectors, they kept jobs in social media, their community forums, and even support locations in order to keep their company going in the right direction. That kind of cut also helped raise employee morale at Nintendo and allowed for their pay to eventually return to normal. It’s a selfless act we aren’t seeing come out of Bobby Kotick of Activision who makes more than $30 million USD a year commit to or even consider.
If he, and their new CFO, Dennis Durkin, took a pay cut, that alone could have saved more than 800 of those jobs and even allowed a restructuring to be committed to. Remember those amazing Blizzard Gear designs from Kieu Le? They aren’t happening anymore after they got laid off from their job. What about the amazing community support from former CM Caden? He’s gone too.
Those very jobs could have been saved had someone stepped up, offered to take a pay cut, and keep their fellow workers around, raising employee morale, and showing them that they too are valued more than shareholder earnings. Other studios have fallen victim to this before as well. Teams at various developers around the world have fallen victim to studio closures.
Sadly, it doesn’t matter. The cards have been dealt, all bets are off, and the next round is about to be played. The only question is – at what cost? What lengths does a company need to go to in order to function properly? Perhaps we all need to remember what Iwata-san once said before he lost his battle with cancer:
Please note that this is an opinion article and does not reflect Blast Away the Game Review as a whole. Any and all thoughts presented are that of the writers and the writers alone.
About the Writer(s):
Dustin is our native console gamer, PlayStation and Nintendo reviewer who has an appetite for anything that crosses the borders from across the big pond. His interest in JRPG’s, Anime, Handheld Gaming, and Pizza is insatiable. His elitist attitude gives him direction, want, and a need for the hardest difficulties in games, which is fun to watch, and hilarity at its finest. You can find him over on Twitter or Facebook.