Decision day and my reply to "D"

How many Thralow reps decided to make the move? Is it really 3 of 50 like I've been hearing?

For those of you electing to be laid off, here is information on how to file for unemployment benefits.

Now, onto D's posts.

D said

Communication definitely broke down with the old org chart. Since the
layoffs and the revised org chart, the structure makes a lot more sense, in my
humble opinion. Also, depts are now being tasked with creating SOP (standard
operating procedures) which is par for the course with most companies of this
size. The SOPs are going to specifically address accountability and provide
training material. We are long overdue for them.

The old (August 06 - Feb 07) 'stage' org chart was similar to the store management way of doing things. That 'style' of management worked well in stage 1 & 2. Stages 3 & 4 seemed to lose something - in my opinion it was because of a reduced # of staff in each area working on the sites.

SOP's should have been something done over a year ago when the operations team was in place. Accountability and real, definable measurements of job performance was something that should have been handled by that team as well. (Maybe then we wouldn't have the fraternization issues we have now. Is Paulette going to KC on a shoe run again anytime soon? How many days off did she take unpaid last year? Did all the employees get treated the same way or was she given special treatment?) Yes, Netshops is a 'growing' (or is that immature?) company and 'these things take time to develop' - sort of like the supplier score cards. When I was there, I didn't find a single one that had been completed. I hope Doug hasn't been led to believe that they were....

Maybe if someone was actually accountable for getting these projects done, Netshops wouldn't have needed to lay off 60+ employees in February. Those employees would have moved out of the company on their own based on clearly defined criteria based on their jobs, instead of just a (seemingly) random bloody swath being cut through the work force.

D also said (about the layoffs)

I went directly to the exec in charge of my department and asked for an
explanation. And I got one.
NetShops is not a failing business nor is it run
solely by Doug. Doug is a visionary leader who often asks for the seemingly
impossible while the other two's pragmatism provides the balance. NetShops also
has a unique business model - only our copycats like CSN come close - and we're
still trying to figure out how to make it run like a well-oiled machine. Growing
pains with such rapid expansion were inevitable. At one time only human bodies
could get the job done but now with so many technological advances being made
internally, humans are being replaced by computer applications. Do you think it
was a coincidence that the first layoff occured immediately after Site Manager
was rolled out? You may recall a chunk of merchandisers were let go or
repositioned.

Very interesting thoughts D. "Growing pains with such rapid expansion were inevitable." Sure. I can appreciate that. However having fewer people to do the same amount of work is insanity. Having fewer people to do more work (if Netshops rolls out another 50 - 60 sites again this year) is just plain stupid. Now, Netshops has applied for some tax breaks, namely the Nebraska Advantage Act. As you can see from the article, Netshops indicated they are going to invest 9.2 million and create 440 new jobs. So, if "growing pains with rapid expansion" really was inevitable and those laid off were being replaced due to technological gains, such as the use of Site Manager, why would Netshops need an additional 440 employees? Again, this strikes me as an easy way to look profitable for the investors. It is corporate churn and an example of how little the employees doing the job day to day are really valued by Doug and Co.

NetShops is getting itself ready to go to the next level. Much like when you
negotiate a mortgage with a banker they talk accounting ratios to get an
approved loan amount. The same is happening to NetShops - we had ratios that
made us unattractive to investors and they needed to be fixed. You can bitch and
moan all you want, but these rules are applied to any business with the goals
NetShops has. Doug telling potential investors that he couldn't let go of
employees because they're good loyal workers would have meant proverbial doors
slammed in our faces and the inevitable tanking of NetShops as a whole.

Again, "ratios that made us unattractive to investors" does not make sense when Doug is applying for tax breaks and claiming he's going to add 440 new jobs. If the ratio was wrong in the first place, why would he need to hire new people? I don't know about you but when I bought my house, the bank didn't tell me I had too many children and I'd need to let some of them go.

Once you go "corporate", there's no going back and the Dougs of the world don't
make all the rules anymore.

That's true. Why do you think Netshops isn't as fun as it used to be anymore? Why did a special 'activity committee' need to be created? Where are the patio umbrellas on the call center side? Where are the hammocks/daybeds and adriondack chairs where people can meet and exchange ideas? Those have been traded for more traditional conference rooms to look more 'corporate'. I guess that's what we need to do when the Buffetts and Blumkins of the world come to tour the office.

I once worked at a plant that was profitable for 33 years straight with no
layoffs. And what happened? The plant was shut down for the better of the entire
company. Fair? Nope. Look at the Big 3 and their job security policies - all
three are so far in the red they may never recover.

By 'big 3' do you mean Doug, Julie and Mark? If you think they aren't making money in this venture you're crazy. Do you think they're doing this for the fun of it? Also, how do you know they're 'in the red'?

I'm still working at NetShops but I admire the balls it takes to follow through
with a very difficult decision.

A 'difficult decision'? It wasn't a difficult decision - it was a quick fix. If profits were really down, why weren't more of the upper managers let go? Why was it store managers on down? If things weren't working, why are the same people still in place in the upper portions of the company? Tina, Dave, Marina, Dawn, etc are all still in their positions. While the store managers and buyers had input on what happened to the sites, ultimately the responsibility falls on the stage directors. If the 'stage' approach wasn't working, why is the person who thought of it still there? Oh wait - she's an owner. (Not that she's going to be there much longer from what I've heard. Once she leaves for the baby, I've heard rumors that she may not come back...)

A healthy, growing company does not let 60+ people go because of 'technological advances'. Especially not when they're applying for tax breaks and claiming they'll be adding 440 new jobs to the city/state economy. (So, really after Netshops lays off the Thralow reps, that will bring the total laid off to approximately 100 employees let go in 90 days. In reality, they're only creating 340 new jobs, not the 440 as submitted on their application.) Netshops has issues and those issues start at the top and roll down from there. As always, I look forward to your emails and comments.

So, what would you say...ya do here?

I already told you: I deal with the god damn customers so the store managers* don't have to. I have people skills; I am good at dealing with people. Can't you understand that? What the hell is wrong with you people?

* Yeah, I changed it to be more Netshops specific. So what?

I just wish I could have taken a copier with me when I left....

Netshops affiliates have become aware of this blog...

Apparently the Netshops affiliate network has become aware of my blog. If you want to read the thread, do so here.

To those reading from the affiliate forum, no, I'm not Peter Peter. Leader, you make some very valid points - I'll touch on those in a moment.

Layoffs at Netshops?
I just put together two bits of information and got
nervous. A few weeks ago, Spilsbury went bankrupt and left a bunch of affiliates
unpaid in the lurch (http://forum.abestweb.com/showthread.php?t=86242).Now it seems
that Netshops is having layoffs:http://laidoffbynetshops.blogspot.com/2007/02/missed-this-article-in-omaha-world.htmlhttp://en.wikipedia.org/wiki/NetShopsIs everything OK? Should
affiliates be worried? Is there any information other than what is doubtless the
party line of "Don't worry, everything's fine"?Pete

Nate - your response

NetShops is a very healthy, rapidly growing company. Most people don't know
we recently purchased another company and inherited about 50 employees. Plus,
because we are still a young company (just turned 5) in a rapid-paced market, we
frequently make necessary structural changes. So yes, some employees were
transitioned to new roles within the company and some were let go. But NetShops
is NOT going anywhere but UP, and you needn't worry about not getting your
commission checks!By the by, we were #13 on Inc. 500's list of fastest growing
companies last year, and the company we purchased was #244.

That's great and all, but the layoffs were of existing employees - not those inherited from Thralow. How many of those 50 'inherited' employees are going to make the transition from Duluth to Omaha? Estimates I'm hearing put the number at, oh, about 3. The song and dance Netshops put on - touring the Netshops office, going to the Henry Doroly Zoo, scavenger hunting at Chuck E Cheese pizza, etc - really didn't 'sell' the 'inherited employees' on moving. So, if 3 of the 50 Thralow reps don't move, they'd have to be laid off, so that would put the 90 day layoff total at about 105 employees released in less than a 3 month period. This is not a sign of a 'growing company'.

"Frequent structural changes" = frequent changes in direction, reorgs and layoffs (in layman's terms). It also confirms what I've been saying all along - there is no job security at Netshops, there is no possibility of a long term career path for employees and the only direction Netshops is going is in a balls to the wall, flat out, mad rush to look profitable for investors.

Now, if this were just a blog by one person and I was bitching and moaning about how unfair it was to be laid off, I didn't deserve it, etc, that would be one thing. Unfortunately, for Netshops, this blog has started to take on a life of it's own. People are sending me information on a daily basis - the current reorg, what the Thralow reps feel like (and what they're doing) and questions they'd like me to throw out there - because they don't feel safe in the current environment asking them themselves. It's really too bad.

Don't believe me? Take a look at all the comments posted to the blog. There isn't a single one done by me and that just scratches the surface.

Leader, your comment -

With anything negative you read: You need to pay attention to WHO is talking,
and JUST WHAT their beef is. Then decide if you think the complaint(s) are
reasonable, and if you should consider the complainers to be credible.

These are mostly former employees talking. However, I am getting information from current employees and some of those 'inherited employees' Nate mentioned. (I wonder how the Thralow reps feel about being called 'inherited'?) Nate does need to tow the company line and I understand that. (Glad I didn't have to be in the meeting about this blog...) Sorry about any additional pressure you might find yourself under Nate. You always seemed like a decent guy and I hope I haven't put you in an uncomfortable position.

Employees get disgruntled when something SUCKS! A company shouldn't have
any/many hugely disgruntled employees, and when they do, that in itself is a
sign of a problem.

Employees at Netshops have been disgruntled for a long time now.

After the layoffs in August of 06, people were pretty upset. Some quit as a result, some were put into positions that weren't what they were doing before and they weren't given much time with the Christmas holiday looming to learn their new roles very well. (They weren't given choices in these new roles either by the way - we came into the manager's office and were told, "Here's where you are on the new org chart. Hope you like it." Even more people quit. Those that didn't and weren't happy were made to apply and interview for, essentially their old jobs as the people who quit were replaced. Nice, huh?) By the time October hit, Netshops employees were asked to do extra work - taking calls in the call center, answering customer service emails they weren't trained to handle, and working in the warehouse - usually 50 - 60 hours per week - along with their normal duties. It was called the "Lend a hand" program. Worst. Idea. Ever.

Many of us thought with a profitable holiday (more profitable than any before - up 85% year over year) we'd be safe from a reorg and layoffs. Unfortunately, we weren't able to hit our gross margin or our profit goals. (Is this because of something the employees did/didn't do, or, because of wildly inaccurate & unattainable goals? That's a subject for another blog, another time.)

And the problem's not the employee (assuming that the angry employee is
reasonably sane). The size of the company is important to consider, though; any
big company probably has several employees who hate it and who will usually be
quitting soon anyway, but a small one ( under 50 people ) only needs a couple of
antis to indicate a problem.So the question is "what is it?" What sucks so bad
that someone has been made angry enough to write blogs and wiki entries about
it?! It's a mistake to assume in favor of the company in these cases. Usually
when the employees start to say a place sucks, it's because it does! (Sometimes
it's just some kook or lamer who had unreasonable expectations, but I haven't
seen that too often.) Personally I find it quite relevant , and would like to
know if promoting NetShops means promoting a bad employer. (And I don't see any
keywords on that blog that'd count towards a what I'd consider a G-bomb...it
doesn't seem to have any "choice" words directly linked to NetShops' URL. )

Again, very good points. At one time, Netshops had approximately 440 employees. In less than a year, I'd estimate they're down to about 300-ish based on the people I saw leave between August and February, and the February layoff. Not a 'growing' company in my opinion. Yes, they're adding more stores. Great. Without the staff to handle the stores they have, how are they going to continue to grow? How will they handle customer service issues? (Off on a tangent here, how do customer service issues/failures effect affiliates?)

Something else to think about. Netshops purchased Thralow, like Nate alluded to. Good company, good people, good sites. Binoculars.com, Telescopes.com, Pans.com, OperaGlasses.com, EMetalDetectors.com, Utensils.com, etc, etc. Those sites are drastically different from hammocks, diaper bags, slippers, pajamas, beds, christmas trees, and adirondack chairs. The technical knowledge needed on the Thralow sites is an important part of selling product on those sites. Netshops reps aren't going to have the experience needed to make an educated guess, much less an informed opinion on what a customer should do. How well do you think Netshops is going to do in categories they don't fully understand?

Last thing for tonight.

"D" - since you've asked that I don't repost your comment, I won't, but I do have a reply I'm working on. I'll need to repost some sections of your post, but I won't repost it in full. That's the best I can do.

Eric - yes, I'm still interested in continuing our conversation - I'll email you soon. Sorry for the delay in responding - interviews have been taking up my time these past few days.

Thralow reps being asked to transfer to Omaha?

That's what I've heard from a few sources. Unfortunately the people that were on their way to check out Netshops Central were stranded by the blizzard. Perhaps as many as 20 people stranded on their way here to Omaha is what I'm hearing. My advice? Stay warm and wait it out.

***Update*** I've been told from another source that there are not 20 people on their way to check out Netshops Central. (I'm not there, so all I can go by is what info is given to me. If they are or aren't on their way to Omaha to check out the 'home office', either way my advice to wait it out and stay warm remains the same.

There are people who are considering the transfer however, so the information below remains the same. I've been told those individuals need additional information to properly decide if they want to make the move. Email me or post a comment with what info you need and I'll do what I can to get it for you. ***End of update***

As far as transferring to Netshops Central, good luck to the people up north. I hope they go into this decision with their eyes wide open about how things are done at Netshops. (Keep your resume up to date gang, because if you think you're anything more than an employee number, you're dead wrong.)

Now, keep in mind, you're going to have to move all your stuff from Duluth to Omaha. That's approximately 380 miles. I've done some checking (since I have nothing better to do with my time now that I'm unemployed) and an approximate cost to move from Duluth to Omaha is $3072.00. That's if you pack and load everything by yourself. If you have someone do it for you, the cost jumps to between $3792 - $4032. If you want someone to unpack your stuff for you, the cost jumps again to $4032 - $4392. Not a small cost to incur especially if you aren't guaranteed to be employed long enough to recoup that cost.

Who knows? Maybe Netshops can have your stuff shipped via Home Direct.