Under the MegaCorp covers during a Pandemic

[kgtest]

What are our business leaders doing...

Obviously creating stimulus policy. Bankers met with politicians, state (governors) meeting with fed...

Stock Buy Backs?

Early Exit Packages?

Layoffs clearly...

Automation?

Where are all the future investments going... DR? Tech? Cloud and off-prem, vs on prem servers


I feel like imolderu posting this but what say you?

 

[SpinDr]

I still have some close ties to my former MegaCorp and they are definitely reacting. All job reqs are frozen, 401k match suspended, bonuses suspended, selected layoffs, and the biggest surprise, which didn’t occur in the last recession, across the board pay cuts. Very, very surprised at the last item.

 

[athena53]

A friend works for a Megacorp (over $2 billion annual revenue) that's a government contractor in the call center business. His work is a Medicare hotline so there were certainly privacy issues to be resolved, but just this past Monday he had training to work from home- and he was one of 8 people in his office selected for a "pilot". Happily, he's up and running now.

My work near the end of my career involved risk management. Part of that was business continuity planning and answering questions such as, "how would you keep on if your offices were no longer habitable?". It appalls me that this MegaCorp is just now enabling its employees to work from home. The good news- they're actually getting incentive pay for continuing to work. They've lost quite a lot of people.

 

[badatmath]

My megacorp is business as usual other than we are doing it from home. 401K match came on schedule and we continued to hire through March and April. No layoffs or rumors of them.

 

[statsman]

I wonder if anything will happen to some of the private pensions funded by the MegaCorps.

 

[HI Bill]

My MegaCorp has cut salaried worker's pay by 10%, and executive level pay by 20%. They've decreased our work weeks proportionally, and cut our life insurance to match our new salaries and cut out vacation accrual proportionally. They're using the cost savings associated with these cuts to pay overhead costs associated with folks who don't have billable work, so that they can be retained.

 

[fassmac]

So far only hiring freeze and skipping of promotion cycle. Drug Manufacturer Mega Corp.

 

[atmsmshr]

Anyone see their mega's advertising budgets cut yet? Seems like a tempting short term target. And an obvious one for restaraunts, hotels, amusement, airlines, oil, etc.

"Half of all money spent on advertising is pure gold. The other half is simply wasted. We just can't tell which half is gold."

by Someone

 

[DrRoy]

I still have some close ties to my former MegaCorp and they are definitely reacting. All job reqs are frozen, 401k match suspended, bonuses suspended, selected layoffs, and the biggest surprise, which didn’t occur in the last recession, across the board pay cuts. Very, very surprised at the last item.

I got this during the Great Recession. The pay cut was from Mgt asking all salaried employees to "voluntarily" take 10 days without pay during 2009. They knew if you didn't do it.

 

[athena53]

Anyone see their mega's advertising budgets cut yet? Seems like a tempting short term target. And an obvious one for restaraunts, hotels, amusement, airlines, oil, etc.

I don't know- at some point when things open up again you want to be in front of the people with pent-up demand who still have money to spend. And I just answered a marketing survey through e-Rewards evaluating a potential commercial for a store chain's on-line order, pickup at store service. I'm seeing a LOT of surveys on the usual topics with a section at the end asking how my travel, investment, etc. behavior has changed due to COVID-19 and how it might change after the threat has diminished.

One area they've almost been forced to cut- business travel. An investment podcast I listened to yesterday pointed that out- companies are saving a fortune because they don't have people flying all over, staying in hotels and entertaining customers and clients.

 

[atmsmshr]

I don't know- at some point when things open up again you want to be in front of the people with pent-up demand who still have money to spend. And I just answered a marketing survey through e-Rewards evaluating a potential commercial for a store chain's on-line order, pickup at store service. I'm seeing a LOT of surveys on the usual topics with a section at the end asking how my travel, investment, etc. behavior has changed due to COVID-19 and how it might change after the threat has diminished.

One area they've almost been forced to cut- business travel. An investment podcast I listened to yesterday pointed that out- companies are saving a fortune because they don't have people flying all over, staying in hotels and entertaining customers and clients.

Agreed on both accounts.

 

[latexman]

My MegaCorp cut salaries of exempt ee's 8%, and management 10%. Also, it's mandatory to take 1 week vacation by end-May.

 

[Spock]

Anyone see their mega's advertising budgets cut yet? Seems like a tempting short term target. And an obvious one for restaraunts, hotels, amusement, airlines, oil, etc.

"Half of all money spent on advertising is pure gold. The other half is simply wasted. We just can't tell which half is gold."

by Someone

The Charmin bears have gone into hibernation...
As with other consumer staples... no sense advertising when the shelves are bare and people can't buy it anyway.

 

[atmsmshr]

The Charmin bears have gone into hibernation...
As with other consumer staples... no sense advertising when the shelves are bare and people can't buy it anyway.

Ya know - I had not noticed the bears were missing, but you are right! Probably the same with Lysol and Chlorox, Campbels soup, etc.

At the other end of the spectrum, I keep getting emails from Princess Cruise lines and Delta - but electrons are cheap.

 

[pb4uski]

.... They've lost quite a lot of people.

Why?

 

[athena53]

Why?

I'm not sure. Maybe it's because many of them decided to shelter in place and felt that coming in to work was a risk? Some, like him, were collecting SS but it was a good way to bring in extra money.

Sadly, we haven't had the chance to be together in person since early March- he lives a little over an hour away and we're trying to shelter in place to the extent we can. We always have the best conversations in person. It's gonna be one hell of a reunion when we can finally get together.

 

[kgtest]

We decided not to hire for an open VP role... but are still apparently have hired some admin folks. We closed some branches...not sure if its permanent yet or not. Definitely cost cutting moves and tight with budgets.

 

[Closet_Gamer]

Working hard to do everything possible to protect employees, pulling obvious expense handles (travel, hiring freeze, etc.), and thinking how to take advantage of the new normal in terms of more cost effective working arrangements.

 

[Starsky]

Layoffs and early exit packages seem to be what's happening in stage 1. I would expect automation and stock buybacks are a bit down the line, if ever. Automation may change course from being task specific, to more flexible - there may be more things we want robots to do that seemed unnecessary before. The ultimate survival factor for business may be a result of having the proper amount of leverage - not too much or too little - so that they can survive while re-engineering a new working business model.

I totally agree that business travel will never be the same. I predict industry conventions and conferences will be re-engineered and will be very different than before. No CES for the next couple of years. It's another huge cost that corporations have been reluctant to cut; but I bet everyone who does trade shows has thought at one time about how wasteful they can be time and resource-wise. Hotel chains will consolidate and many will fail as a result of the lower occupancy rates.

It's hard to visualize what will happen to leasing cap rates for commercial real estate investing. Does the whole industry just revalue all their property portfolios at once? It will be a bloodbath. Spending patterns will change. I can't imagine any commercial tenant who won't ask for lower rents, particularly those with high fixed costs. It should be interesting to see what happens to retail leases that depend on percentage rents. Retail malls seem like a bad investment.

Any company supporting tele-work is going to blow up. I think that uniform companies will have a huge heyday selling safer work gear, and those people that clean the offices at night will definitely be getting a big raise. With tops being in and bottoms out, business clothing sales should be interesting too... How about a one-piece suit?

Frankly, I think the hardest thing for business leaders will be to calibrate their output accurately to meet market demand. There's nothing to go on to make accurate planning decisions. I'm SO glad I'm out of the workplace right now!

Edit: This could change the product life-cycle of consumer goods. With no annual conventions to make announcements around - and all the existing business challenges - manufacturers may find it's easier to make things on their own time schedule rather than waiting for an annual industry event to introduce new products. I've already seen it happen in the music industry.

 

[thepalmersinking]

Anyone hearing about early retirement packages? I have heard. A rumor at my megacorp, just wondering what examples look like? Set for class of 2022, but might be class of 2020.

 

[Spock]

Anyone hearing about early retirement packages? I have heard. A rumor at my megacorp, just wondering what examples look like? Set for class of 2022, but might be class of 2020.

packages vary between divisions within a company and definitely vary within the same company from one layoff to the next. What company X does has no impact on what your's may or may not do.