Cutting 12% of staff nine months before the runway required it
The model said we could wait two more quarters. We cut early anyway, on the argument that a smaller cut now beat a larger one later. That argument is harder to defend than it sounded in the room.
The decision timeline
Three moments, kept separate. What became known later sits in its own column so it cannot be read back into the reasoning.
Known at the time
- Fourteen months of runway on the then-current burn
- Two consecutive quarters of flat new-business bookings
- Q3 pipeline data would not be reliable until September
- Consultation in one jurisdiction set a four-week minimum
- A board request for a plan by July
Decided, and why
- Cut 12% in June, on the argument that an early smaller cut beats a later larger one
- Selected by role rather than performance, to keep the process defensible in two jurisdictions
- Enhanced severance above statutory minimum, to reduce the damage to those leaving and to the remaining team's trust
Known later
- Q3 bookings came in 18% above Q2 — two slipped deals both closed
Members see the full outcome.
Trust and provenance
What we checked, and what we did not.
The decision context
| Problem | Revenue growth had flattened for two consecutive quarters. The burn model showed fourteen months of runway. The leadership team debated whether to cut in June or to wait for Q3 results. |
|---|---|
| Deadline | Self-imposed. The board asked for a plan by the July meeting. |
| Stakes | High |
| Decision-maker | CEO decided. Head of People designed and executed the process. |
Constraints
| Budget | Severance was funded from existing cash; a larger cut later would have been funded the same way but from a smaller base. |
|---|---|
| Time | Six weeks from decision to notification, constrained by consultation requirements in two jurisdictions. |
| Information | Q3 pipeline data would not be reliable until September. We decided in June. |
| Authority | Works council consultation required in one jurisdiction, which set the minimum timeline. |
| External | Two competitors had announced cuts that quarter, which affected both market perception and the hiring market for leavers. |
Alternatives
Options considered, and the stated reason each rejected option was rejected.
Evidence, reasoning and outcome
The remaining six field groups — evidence, reasoning, action, outcome, reflection and transferability — are available to members.
- A fourteen-month runway model with three scenarios
- Two quarters of flat new-business bookings
- Protects the capabilities the recovery case depends on
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Rights and licensing
Published terms for this case.
| Consent | Creator confirms permission to publish in redacted form. No affected employee is identifiable from this account. |
|---|---|
| Licence | Non-exclusive, perpetual licence to publish and monetise. |
| Anonymisation | Employer, jurisdictions and all individuals redacted. Figures expressed as percentages. |
| Compensation | Eligible for the creator revenue pool under the published allocation rule. |
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