How it feels to be made redundant

As they were taking you on, good times were rolling. Returns were high, risks were underestimated, salaries and bonuses were enviable. Then the housing bubble in the United States burst and fallouts flied even to Poland. The industry faced a slowdown and felt the pressure to economise. To make things worse, just before the outbreak of the crisis your company was about to fully merge with another one. Unfortunately, due to Competition watchdog’s objection, the takeover was only partly brought off, the buyer picked the best divisions and rest was put up for sale. It soon found a new owner; the sucker was ready to pay over the odds for the piece of shit which used to be one of the leading and most reputable players on the market.

The new owner introduced its principles and began to turn the business around, despite really adverse market conditions. Faced with the choice either to shape up and keep your mouth shut, or to ship out and begin to look for a new job, on the market flooded with supply of similarly profiled professionals. You soldiered on and they appreciated your effort. Soon you got promoted and received a pay rise, while over 10% of the staff were laid off during the first wave of employment restructuring. Then ensued the second wave of lay-offs. Several people around were fired, but this was not your problem. You held down the job and performed well, so you did not need to be afraid.

As the economic recovery begin to fade and sovereign crisis in Europe loomed more perilous, your company, despite everything, announced expansion plans. The whole market learnt who was going to be the growth leader, competitors looked with some disdain on your company and slowly began to downsize to retain profitability during economic slowdown.

Reality check came a few months later. There have been some mistakes regarding the strategy made, but executives found the scapegoats in those who had been fired some time earlier. Review of recent performance figures proved the growth strategy fizzled out (unless you define growth as shrinking). Time to bite the bullet has come…

Hearsay over the third wave of cutbacks had been heard long before, but the press release saying this would happen and unveiling details of the plan was issued during the trading session. Shares of you company soared at the news of cost-cutting plan, but retreated to pre-news level by the end of the day. After all investors and speculators know this boat is bound to sink.

Following the lay-off announcement and recent 10 PLN pay rises, motivation among the staff fell dramatically. Nobody felt what they were doing was making sense, the company was going nowhere. Instead, everyone began to fret over the imminent job loss and make fun of the under-performing business.

In a message to employees the executives promised people will be notified in advance of their redundancy, treated with dignity and will receive the proper support and a generous severance package.

As time went by, only the very last promise has not been gone back on. How your fateful day looked depended on your position.

If you were a rank and file, head of your department took you to a room where you also met your HR manager. They told to sit back and handed you an envelope containing all documents linked to job contract termination. They informed they were too many of you in the team and you were selected to continue your career outside this organisation. You could either agree on a conditions proposed by the company or leave with no severance package. So you agreed obediently and got informed by when you can still work and hand your duties over to another employee and sign up for a course “how to write a CV successfully” (you had not been on the market for over 10 years so you did not know or have forgotten how to do it).

If you were a manager, you the invitation for a meeting when they were giving you notice looked similar. Severance package also did, but managers were given a very short deadline by which they had to pack their stuff and go away. Usually it takes two days to close their duties and say goodbye to your colleagues, then you can take your due days off and are requested not to come to work at all. You are still paid and are not allowed to take up a new job with a competitor, but your employer clearly tells you they do not want to see your face any longer. Slap on the face slightly worse than 10 PLN pay rise.

You colleagues seem to sympathise with you, but deep down they are happy it is you, not them. After all they are no irreplaceable people, those who stay on will have it much worse since now. The company has to grow anyway, only labour force harnessed to propel the growth will be less numerous. This is not the tragedy, they will have to work even longer and harder, in other words, more efficiently. Touch luck…

While you are gone you realise you are out on the limb – nobody needs you, market is full of professionals like you, fired by other companies in the industry. Your severance package will help you scrape along and keep paying off your mortgage for a few months or even a year, if you decrease your standard of living. What then – who cares… Maybe on the occasion of the next wave of lay-offs, set to come next year, somebody will mention you and wonder how you are doing.

To make it clear, I have not been fired and I have been told I will not lose the job under restructuring programme this year. But next year opportunities may unfold, with a more generous severance package…

Any similarities between real companies and event are totally accidental. The story is an absolutely fictitious figment of my imagination…

Taking chances

I was a first-year student, when, during a class in basic microeconomics, I first encountered the topic of risk from economic perspective.

Have you even tried to put in words what actually risk is?

In economics and finance, one has to distinguish between risk and uncertainty. The former must be measurable, the latter is not quantifiable. If the risk is measurable, it should be possible to estimate probability that a specific scenario materialises. In life we usually face uncertainty – hardly ever it is possible to make an educated guess on how probable it is that a choice we are making will prove right.

Those who have even learnt business English should have come across several verbs that go together with the noun ‘risk’. You can: accept, analyse, avoid, estimate, hedge, manage, measure, minimise, mitigate, quantify, run, take, tolerate, understand a risk; share it and divide it. Something can carry or pose a risk, something can be put at risk. ‘Risk’ as a verb and adjective ‘risky’ might come in useful quite frequently.

Economic theory distinguishes between pure and speculative risk. In the case of the former you might lose, or not, but you cannot win. Pure risk can be transferred to another party, willing to take such risk, this happens when you buy an insurance policy. In the case of the latter there might be one more outcome – you might also win. Modern financial engineering has devised many tools used to manage risks, transfer them between entities and “reliably” quantify it. When misused, those tool can result in worldwide financial meltdowns…

Economists have come up with a concept that different people have different tolerance of risk. Some are eager to take it, some avoid it, some are indifferent to it. As scholars claim, most individuals prefer not to take risks and make do with certainty equivalents. Most of us would rather take out an insurance, pay a fixed premium and reduce our exposure to a specific risk, many people do not fancy investing their money on volatile stock exchange and put them into bank deposits, on which they can earn lower, but “safe” income.

But what determines an attitude to risk a specific person has? Genes? Upbringing? Entourage? Education and awareness? Experience gained in life? Job and challenges it poses?

Why in different realms of life people have a totally different tolerance of risk? Some people drive like lunatics and risk their and other people’s lives but would never put their savings on the stock exchange. Others are not afraid to run up debts in form of mortgage loans for decades, but avoid taking professional decisions that entail responsibility.

Does eagerness to take risks influence the job one should take up? What should be the profile of an employee who works, like me, in risk management? (Incidentally, I recently heard in the risk division there’s no place for people with below-average IQ!) Surely they should have competence to assess and analyse risk, but how about the tolerance of various types of risks their employer would be exposed to, depending on their decisions? Of course, they are paid for taking care of someone else’s business, so private preferences should not matter at all. Once I triggered peals of laughter at work when I commented on potential highly speculative financing for a junk public company: “I wouldn’t put the bank’s money at such risk as my own”.

Financial institutions have their risk managers (who should be well paid ;-)), but human beings should be able to cope with uncertainty in everyday lives. Almost every time we take an important decision, the outcome is a mystery. Choice of path of education – whether you choose the right studies might impinge on your future self-fulfilment. Choice of a spouse – will influence your happiness. Both aforementioned decisions will also affect your financial standing, as well as the choice of career path.

Such decisions surely involve a bit of stress, as each even-tempered person should think twice, weigh in pros and cons, analyse what can go wrong. This can result in paralysis by analysis, but done prudently might help avoid mistakes, which in life are inescapable anyway. When choosing to study at SGH, I was not sure if this would be good for many; with time fortuitous decision proved right. When I got an internship in credit risk department I was not sure whether I would find my way there, but soon settled down very quickly and well there. Again a leap into the dark proved a good decision. I feel when one day I’ll pop the question I will have doubts whether this woman would really be the one I want to spend the rest of my day with.

It is probably the saddest point of this post. These days nothing lasts forever, promises are broken easily and without remorse. Is my observation, that people no longer hold stability as dear as they used to in the past, right? I recently witnessed a marriage breaking up just because one of the spouses found a few years younger, sexually attractive partner. After a few months the new couple have shaken off the short-lived affection and came to a conclusion that together they cannot face everyday hardships and actually they do not fit each other. Guess how one of the spouses, who left the family for a fleeting adventure, the other, cheated-on spouse and their children felt… Now they are back a family and are trying to pick up the pieces of the broken-up marriage and start a new life. But I know how the ex-lover of the spouse feels and oddly enough that person currently appears to be the most hurt, deceived and disillusioned.

For sake of clarity, I do mention the sex of the unfaithful spouse, just not to spread stereotypes – both women and men cheat on their partners… Also for the sake of clarity I am not the aggrieved hero of the story. But there were times when I found flirting with older (in their 20s and 30s) women in relationships exciting (then I have grown out of this silly sort of entertainment). But except for realising those were childish games it occurred to me that if a woman dumps her boyfriend for me, one day she might be capable of doing the same with me for another guy.

There is not just the fear that someone might hurt me, what worries me is that I may inadvertently break a promise given to someone. One day my common sense might tell me to take a path which will give me some stability, but will not be the most preferable, but some time later I might feel the temptation to try my foregone luck. Life is full of wasted chances, but is it worth taking a chance, heedless of consequences?

And you can speak about any risk here? Only uncertainty is left…

Memento mori...

All Saints’ Day and the subsequent All Souls’ Day – the short period cut out from the contemporary life-centred culture when we bring back the memories of the departed ones. We focus on the past, but pass over the thought of what is inevitable for us – one day we’ll also pass away, but this moment is pushed into the distant future by most of people. As in case of all unpleasant thoughts, this one is also driven out of our minds…

For the past seven or eight months I’ve had several dreams of my death. They were usually set in the future. (below my description from the discussion on W-wa Jeziorki blog)

First one: Centre of Warsaw (pedestrian precinct along Centrum Department Stores. I walk slowly and all of the sudden feel the stabbing pain in my chest, somewhere around my heart, the pain knocks me down, I fall over, other passers-by also cringe, a moment later sky starts falling. My explanation - too much reading about the conspiracy theories of doomsday foretold on 21st December 2012 (the Mayan prophecy).

Second: I simply sit behind my desk in the office (I'm no longer a student), again I feel an unexpected pain in my chest, I slump forward on my desk, my co-workers scream something. Possible cause: premature death on heart attack?

Third: summer, sunny day, I mow the lawn in my garden, meanwhile chatting with my neighbour standing behind the fence. Suddenly it's getting totally dark - the big blackout comes, either I'm blinded by something or the sun goes off - impression just like if somebody turned off the light. The engine of the grass mower stops. Neighbour and I still talk to each other trying to comment on the phenomenon. After ten seconds the pain starts penetrating my body, from feet goes up to the heart, then blows me up - I had the feeling of the bomb exploding inside me. Explanation that the blade of mower caught on the extension cord wire doesn't seem plausible(?)

Three dreams had one thing in common - after my the moment I died in my dream I woke up with the real pain in the chest, it eased off after one - two minutes.

These last ones also have another element in common – an apparent dazzling flash I felt in my eyes just before waking up. The feeling resembles a situation when someone puts a camera in front of my eye and snaps, giving off a flash. I think I had two visions when I was crunched by a tree struck by a lightening – it leads me to the next explanation of the flash. Quite often it was accompanied by feeling of sinking into myself…

I still wonder what this all means. As a typically down-to-earth person I approach such things rather sceptically, but what we dream is conditioned on what is hidden is the darkest ends of our mind. It seems such theory is much more convincing than “harbinger” ones. I don’t think those dreams herald an oncoming decease. After all if our fate is written somewhere, we can’t change, so there’s also no need to worry about the future.

Nevertheless a dose of fear creeps up. It’s not the fear of death, rather of the unknown. It doesn’t paralyse my life, actually it doesn’t affect negatively my everyday activities. It causes only two things. Firstly, it doesn’t let me do, what around ninety nine per cent of people do – I can’t take for granted that nothing bad is going to happen. Secondly, it fills me with gratitude for each day which happened without an unfortunate event. I wonder how many other people experience such brainwaves…

Picking up the pieces...

It’s not a breakthrough, nothing uncommon or extraordinary is going on, so why I do feel cut up? Maybe indeed when one stage ends it’s time for an overhaul, but what about being cut up? How to explain the mysterious dreams of death (five of mine this year and series of other visions haunting me since the beginning of July)? A call form above? A reason to be conscience-stricken?

Crisis – that’s not the explanation of course, but it brings me on analysing outlandish social phenomena around me. Many of my schoolmates, including me feel insecure. Some even in spring decided to laze away this summer, some, like me, reckoned that crisis wouldn’t affect us. We were a bit wrong, I don’t know if it’s the cause why some of us feel somewhat of fear of adulthood, a few thought seriously about gap year between BA and MA studies just to put off adulthood and prolong the partly carefree student’s life. In contrary I’ve always been determined to graduate as soon as possible, now I’m not so sure if this is the right idea. And what’s going to happen in 2011? We do everything not to end up in the low-paid position, we’re striving and aim higher, but if the crisis drags on, we’ll have to revise some of our plans created before its outbreak, when we began our studies. We’ll never come back to the times of extortionate salaries, in the worst-case scenario after greeting me Szanowny Panie Magistrze you’ll just add poproszę frytki – popularising showing respect to McDonald’s staff deserves my highest commendation. Warsaw School of Economics won’t probably turn into Redundant School of Economics (Szkoła Główna Bezrobotna). At least for me, by the way – today I took the competence test at one of the banks where I applied for a post of translator and… I realised I had forgotten my native language. I got used to doing what I shouldn’t do – translating into foreign language and when I tackled the documents in English to be translated into Polish I turned out that despite I understood them in one hundred per cent it was hard for me to find appropriate words in Polish. English is marked by simplicity, what can be described in English with two or three words hardly ever can be expressed in as many words in Polish. To all the foreigners who learn Polish – my congrats on taking up such challenge!

Hard to untangle – one bank where I worked last year had to suspend (unofficially) its internship programme, another bank looks for students to trim costs and gets rounds or bends its internal regulations to take them on and farm out task which should be executed by someone else – everything in the name of savings.

But tomorrow I’m heading for Suwalszczyzna, to Poland’s cold pole. I’ll get away from the whole mess, fish, swim, drink home-distilled moonshine and have a whale of time. And I can’t forget to contemplate the idiosyncrasies and absurdities of Polish countryside… That will also a week of computer dry-out, after which I’ll swamp with a photo coverage of the foray…