I have been here a long time so naturally been through many rif cycles. The rif starts when upper management wants to reduce costs to prop up quarterly earning reports and increase their bonus and their stock incentives. This has been occurring on a rolling basis since the financial crisis of 2008. The exception to this is upper management. New upper management tends to swoop in every 3-5 years and get paid handsomely before departing so rifs are generally reserved for the worker bees and sometimes any upper management member that may still be around from the last regime. Execs have to keep their circle of trust at the top so if you are not part of that you will be pushed out.
What you have to understand is that rifs come in many forms. As they trickle down from upper management to lower management there is sometimes a lot of freedom to use the rif in different ways. In other words, rifs can be used to simply reduce head count based on who gets paid the most, whos job is being outsourced or who is the lowest performer. Unfortunately, this many times results in lower management playing favorites and picking friends to stay versus employees that really need to go.
Because HR at AIG is so inept, rifs are sometimes the easiest or only way to get rid of low performing employees. Sometimes rifs take the form of an easy way to house clean a department because no one has to build a case against the employee. Rifs offer a reason to eliminate literally anyone for no reason other than cost reduction. Most commonly, if not associated with outsourcing and never stated by management, rifs are generally targeted at employees who have been at AIG a long time, are not friends with current upper management and have moved into some type of middle management role after years at the company.
One of the most toxic things about rifs is that they reinforce to every employee that the longer you are at AIG, the more likely you are to be rifed. There is simply no loyalty or reward for years of service and really no incentive to remain at AIG long term unless you have already been here a long time and are waiting for a package. So every rif cycle shows young ambitious employees that you cannot trust AIG or plan on staying for any length of time. It also reinforces to most lower middle management that no matter what you do you aren't getting promoted and your days are numbered so there really is no incentive to work too hard. Just hang around and collect a check until AIG pays you to leave. This is why you see the posts on this sight saying middle management is old and lazy. Its not always that they are old and lazy. The culture at AIG conditions people to become this way. Don't fall into this trap. If you are young, you must not remain at this company for more than 3 to 5 years. 5 years is the absolute maximum to prevent career s–c-de. Every new group of CEOs takes the same approach. Cut costs and try to underwrite better. The biggest issue at AIG isn't an underwriting issue, its a character issue.
When employees have no trust that upper management will be here in a couple of years, let alone do the right thing, you have a culture of mediocrity that exists year after year. New execs come in and cheerlead and give great lip service, but nothing ever changes for lower middle management and the average employee. AIG writes fluff stories about how much they care, celebrate diversity, blah blah blah. Unfortunately, at the end of the day your career is stagnant, most career advancement opportunities are filled by friends of whatever regime is currently in power and if you are lucky you may get a 2% cost of living increase if you really work hard. There is no motivation to work hard because you don't respect this company or the people running it. Plus, you know that the odds of you being here next year get slimmer by the day.
As long as AIG takes this approach young talent will flee. Old burnt out talent will do only what they have to do. AIG will remain mediocre at best. The only new employees that stay long at AIG are the ones that can't find a job at a better company so AIG ends up with a cast of underachievers in all departments. AIG will never compete with companies that actually nurture their talent and foster opportunity. BD and PZ will come and go and get rich and AIG will be in the exact same place because these guys neither care, nor have any idea how to turn around this culture.
Here's a hint BD, it doesn't matter how many "top execs" that you hire. The average employee is the one selling AIG and working with the brokers and clients. Maybe you should focus a little more on the people that touch clients rather than the execs that push paper!