The virus, called COVID-19, first appeared in China and has dealt such a blow around the world that many now simply do not know what to do. If you think about it, the plot of everything that is happening now looks very apocalyptic. People are locked in their homes, infrastructure is out of work, and economies around the world are on the brink. All this is due to some piece of RNA in a protein coat, which can not even be seen in every microscope. As a result of all this, ordinary people and large corporations have to lose a lot of money and make difficult decisions in order to get through this period with as little losses as possible.
Even such companies have difficulties
Why the crisis is dangerous for IT giants
To understand the scale of the disaster and not say that Google and Apple have a lot of money, you need to understand that they have big incomes, but the wheel of their business must constantly turn. From this point of view, it is much easier for an ordinary person, even with an average income, to spend several months without money and live off the accumulated funds.
This is due to the fact that in addition to huge revenues, companies have expenses that are not much less. At a minimum, they have a lot of real estate to maintain and pay taxes on. They have production and well-established logistics, which must be somehow optimized or canceled, but still pay for it. Plus, we need to somehow continue to engage in research and development in order to keep up with the technological race.
The most important item of expenditure is wages. Large companies employ tens of thousands of employees around the world. This is hundreds of millions of dollars just for wages at the very minimum. Most likely, taking into account the salaries of top managers, this amount can exceed a billion.
All of this is an overwhelming burden on the shoulders of companies in those moments when revenues are sharply reduced. This happened with Google, and in addition to canceling events, she began to make the first difficult decisions.
What Google is doing to combat the crisis
Of course, Google can transfer its employees to remote work, but this predictably decreases the quality of services. For example, the company had problems with YouTube videos moderation. As a result, more videos began to fall into unwanted ones. And there were also problems with regular updates to Google Chrome. It is unpleasant, but tolerable. Now it came to personnel policy
Google today released its internal report amid the raging COVID-19 epidemic regarding changes to its recruitment policy this year.
Bloomberg received the data from this report, which CEO Sundar Pichai sent out to Google employees today. It also points out that the situation at the company has changed dramatically since it had to close its first two major offices in Asia earlier this year.
There are no more people in the company's offices now.
Pichai also noted that only a quarter of 2020 is behind, but it can already be called the strangest in the history of the company. Until a few months ago, few would have imagined that almost all employees would have to work from home during the biggest pandemic of our time.
The head of Google says the company is forced to revise its HR policy. Of course, massive layoffs should not be expected, but plans for new employees will be revised. Pichai believes that this is the only way to prepare in advance for the storm that promises an economic crisis and to get through it with minimal losses.
As in 2008, the entire world economy is now experiencing global problems. They cannot ignore Google and Alphabet. First of all, because of partners who are also experiencing difficulties on their fronts.
Last year the company planned to recruit 20,000 employees in various areas of activity. Of these, 4,000 people have already started work and about 1,000 more are ready to do so in the near future, but due to the fact that everyone is sitting at home, there is no one to teach these employees and no one to provide them with everything they need to work.
Further hiring will also be heavily revised. An exception will be made only for key strategic areas. Simply put, only those who can directly help the company overcome this difficult period will be hired.
There is no one to work, everything is remote.
In addition to cutting hiring, Google plans to cut costs in other areas of activity as well. For example, equipment upgrades, data centers, marketing and business travel. Let me remind you that the company has always been an example of how to go on business trips. Barely, its specialists immediately drove in the right direction or, on the contrary, partners were invited to the company's office.
Google Pricing Policy
In a way, such plans of the company can explain the desire to make its products as competitive as possible in terms of price. I mean the discounts they set this week on the Google Pixel 4 and Google Pixel 3a.
This was largely due to the desire to compete with OnePlus and iPhone SE 2. But simply cleaning up the warehouses and quickly freeing up a large amount of money would not be superfluous either.
Also, rumors that the company is preparing to release the Google Pixel 5 not on the flagship processor, but on a slightly simpler one, are becoming even more logical. Unlike OnePlus with its horse-like prices for the OnePlus 8 Pro model, Google can cut costs a little, set the price lower and gain a lot of fans of the brand, who will bring it money now and will continue to be loyal fans of the brand.
In general, the company's policy so far looks very interesting and promising. Let's see what happens, but for now we can praise the company's management for its foresight.