Sun Microsystems Layoff

  • Kevin W. Shockey

    Sun Microsystems underwent a round of layoffs last week, this time within the division responsible for its SPARC servers. The company is sacking 7 percent of the workforce in its Scalable Systems Group (200 people), the division responsible for its traditional SPARC server platforms, including the recently released UltraSPARC T1 processor, formerly code-named "Niagara."

    For Sun, which shed some 13,000 jobs between 2001 and 2005, the layoffs are part of an ongoing cost-cutting strategy that spread out over a number of years what should have been done in one fell swoop early on in the bust.  As John Shoemaker, a 15-year Sun employee who led the company's server group until his retirement in 2002, noted in the January-February issue of Business Horizons, the journal of Kelley School of Business (PDF),  Sun isn't as decisive as it needs to be when it comes to issuing pink slips. "Key executives at Sun met our greatest challenge when we were unable to convince our top decision maker to take quick action to implement a massive headcount reduction," Shoemaker wrote. "In the fall of 2000, Silicon Valley experienced the greatest number of layoffs in its history. While other large technology firms like Cisco and Intel bit the bullet to save what they had and to protect the investments of shareholders, Sun's reduction-in-force actions were too little, too late. This single failure to make a tough decision to reduce headcount at Sun was, I believe, the critical event that precipitated Sun's now infamous decline."

    Harsh words, but it's tough to disagree. Sun continues to be financially troubled at a time when many of its rivals are doing just fine. In retrospect it probably should have followed step with IBM, HP, and others who took the scythe to their ranks during the drought. But it just never seemed to have the heart or, according to Shoemaker at least, the testicular fortitude to do the deed. "You have to hand it to leaders, such as Steve Jobs at Apple and John Chambers at Cisco, who acted fast and made the tough decisions to turn the negative technology outlook into a positive competitive position for their companies," he wrote. "The lack of like decisions at Sun led to a major impact on morale, a loss of competitiveness, and a brain drain."

    • PJ Cabrera

      PJ Cabrera - 2006-04-12

      "Let's keep rearranging the chairs, boys! Maybe that will stop it from sinking!"

      -- last words heard on the deck of the Titanic


    • Ernesto Díaz

      Ernesto Díaz - 2006-04-14

      lmao I thit like Pj's comment, hey PJ I haven't spoke to you in a while. Let's try to meet some where this week. I never thounght this will happend to Sun since the are so huge and changing the market w0w this has me in shock. Yeah right.

    • PJ Cabrera

      PJ Cabrera - 2006-04-15

      This week is bad, lots of church crap.

      Let's try next week. Anyone else interested? Lenny? Kevin? Bueler? Bueler? Bueler?


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