I have talked to several Betriebsrat members and HRBP. I also had a conversation with a member of the supervisory board. Here’s my perspective.
Layoffs are a last resort. CK and the board intend to resort to them only if the share price falls below €150 in Europe. This would enable them to push it back over €165, which would be a relief. Otherwise, it serves as a bargaining chip.
How does it function as a bargaining chip? The executive board members lack empathy. They often say so many inappropriate things about employees that they spend a significant portion of an earnings call apologizing for their previous comments.
Layoffs can decrease the number of elected Betriebsrat and Supervisory Board members.
Layoffs foster a submissive workforce that complies with management directives.
Layoffs are particularly challenging to implement in Germany, France, and other European nations.
Layoffs are costly and will diminish the funds the board wants to allocate for share buybacks.
Layoffs will attract negative media attention and lead to expensive PR costs.
Even if layoffs occur, they will NOT target the highly paid executives and area heads and managers earning over €250k annually. Their backing is too crucial for the board. Therefore, if layoffs do take place, SAP will likely let go of thousands of employees who are not deemed worthy. Like you and I.
But then how is it a negotiation tool? Well, it's what made performance management possible. It allowed them to cancel or reduce almost all benefits. And it enabled them to decrease salary budget this year. A lot of job postings have been pulled and we're in a semi hiring freeze. Travel budget is close to non-existent for teams yet executives and managers are able to travel a lot.
They won. They created a hostile atmosphere where everyone is scared to speak up. And they will continue to threaten us with layoffs till there is no spirit left in anyone at the company.
But this is just my theory and I don't know this for sure. What are your thoughts?