Nintendo president Satoru Iwata has said that he won’t reduce staff because he thinks it will reduce the employee morale. One thing to note here is that Nintendo is not a giant company when it comes to the sheer amount of employees like Sony and Microsoft.
However, his reasoning is pretty solid, and something that a lot of companies should follow instead of just laying off people to increase profitability.
“If we reduce the number of employees for better short-term financial results, employee morale will decrease,” he said during an investor Q&A. “I sincerely doubt employees who fear that they may be laid off will be able to develop software titles that could impress people around the world.”
“I know that some employers publicize their restructuring plan to improve their financial performance by letting a number of their employees go, but at Nintendo, employees make valuable contributions in their respective fields, so I believe that laying off a group of employees will not help to strengthen Nintendo’s business in the long run.”
It’s hard to replace talent and what Iwata said makes a lot of sense when it comes to a company of that size. Its market valuation is around $15 billion which has reduced a lot since the Wii/DS days, so understandably they are in pressure to turn things around for the company.
Source – Nintendo.