66 University of Washington tech workers are going to be hitting the streets on the 30th of June 2008 due to a “perfect storm of events” that has lead to the largest layoff at the University in near a decade. The scary part is that this is a two part issue, one financial, one technological. On the technology side, a state run institution is finding that they can not compete against the likes of free services provided because web 2.0 is so very effective in delivering commodity services. Even some of the homeless in Seattle have e-mail, it is not surprising then that UW Technology Vice President Ron Johnson would state:
UW Technology Vice President Ron Johnson said the increasing availability of free or low-cost services on the Web through companies such as Google, Microsoft and Amazon.com are rendering some UW services — such as e-mail and document sharing — obsolete. He said annual revenue has dropped by $10 million, to $40 million Source: Seattle Times
The problem with commodity services is that they do what they do very well, provide an excellent service for a very low cost. The advent of Google Docs, and their competitors like Zoho means that the collaboration spaces are not needed for students, students will use their Google mail over the WebPine system that the university uses internally. As the university was unable to afford or find an alternative to the primitive WebPine system, their service infrastructure was doomed. The other perfect event according to Ron was:
Johnson said a “perfect storm” of events meant he wasn’t aware of the dire revenue situation until late February or early March, about six months after the problems began. That perfect storm included a restructuring of the financial reporting process and some key people who were “not on top of the situation in the way we would have liked,” Johnson said. A couple of people have resigned or retired as a result, he added. “There was a lot of denial going on in this,” Johnson said. “Everybody wanted to assume the rosy scenario, not the bad case.” Source: Seattle Times
Financial systems, they need those, but also explains many other issues within the university of Washington system. While the university has little room to grow because the state cannot subsidize them to a level that would allow them to grow, money had to come from somewhere. If the cross over to a new financial system caused a major disruption of the budget, then the easiest way to recoup money is to lay off people. This is money that can be gotten quickly, but the real tragedy is that many of the people coming out of the University of Washington system are going to have a very hard time competing with the modern systems that many other companies use.
Essentially, given knowledge of the systems in place, and not knowing anything else, those that are laid off will have an extraordinarily hard time being employed somewhere else. That is the real tragedy, not a perfect storm of events, but out dated technology skills in a super hot market, with no one wanting to buy them.
Tags: university of Washington, Ron Johnson, technology, layoff, sad, skills, unhappy
Wow, you are making some pretty misinformed assumptions. The main driver behind the layoffs (and is not mentioned in the article) is a not a transition in “financial systems” (i.e. software) but in the way the University and UW Technology’s finances are handled. Specifically, how benefits are paid for.
UW had been paying for UW Technology’s employee benefits, but THAT changed, resulting a significant budget shortfall.
Additionally, you are truly misinformed (understandably if the article is all you’re going on) if you think the people who were laid off were some kind of technological relics. That might be true of a small percentage, but there are some folks leaving who are at the bleeding edge of the field. The problem is cuts needed to be made somewhere, and their positions (many R&D) are now luxuries in a division that has to now run as lean as ever.
Interesting, there was nothing mentioned about R&D, those folks will probably not have a hard time, and yes, the three articles, and one quoted, all pretty much so said the same thing. That it was a shortfall in budget of 10 million dollars, and people losing sight of what was happening with the budget.
Depends though on what kind of benefits, you don’t usually pay benefits on people who have left already, and you don’t call that a layoff, and you don’t blame budget either.
As for hiring, I’ll stand on what I know, some of the technology used at the U is pretty out of date in a web 2.0 world. Some might be bleeding edge that spins off a startup which would be cool, some of the skills might be uber high tech, but most of what I have seen from friends at the U, not so much so.
I also seriously doubt that the U would let their R&D folks go, they are the ones who get the grants. My 2 Cents, your points are good and interesting, worth a debate over drink of choice.
“they can not compete against the likes of free services [gmail, etc]” … and hopefully students and staff don’t communicate sensitive information using these free services.
Friend, totally agree, the minute ppi information gets out on a commercial channel, there will be a lot of problems.
“Essentially, given knowledge of the systems in place, and not knowing anything else, those that are laid off will have an extraordinarily hard time being employed somewhere else. That is the real tragedy, not a perfect storm of events, but out dated technology skills in a super hot market, with no one wanting to buy them.”
I can donate clue if you need one… you seem to be lacking.
Charles, by all means, it would be great to fill out the story, if the information is inaccurate, then by all means, let me know what you know. Thanks!
The shortfall was known for more than 4 years. There was plenty of time to adjust but Johnson was not interested. The financial adjustments made were a representation of gross mismanagement both within C&C and with the way the UW provides oversight to departments… even service based departments.
C&C salaries are still very high and there are lots of positions that have very little purpose, so this adjustment is still an issue of mismanagement. Good thing Ol’ Ron wasn’t hurt by this though… he actually got a raise.