Thread regarding ExxonMobil Corp. layoffs

@1stp+1dhc38iq
“Higher paid employees” happen to be higher paid because they have something called EXPERIENCE. Replacing them with new hires out of college is outright ridiculous, if results are somehow expected. Sending work to “lower cost countries” has repeatedly shown to be a disaster, especially for work of any complexity. These supposed “cost-cutting” measures are the pipe dream of thoroughly incompetent managers, who can’t even learn from the failures of their predecessors.
This is precisely a recipe for MESSING UP the coming upturn. Even in an upturn, managers need to have a brain and that’s obviously not the case at EM.

I XOM will be at least $120 by end of 2022. It’s called a turnaround. Oil supply is down and dropping further, demand is increasing and will continue to increase. Add to that the cost cutting by XOM where they are reducing the workforce and greatly reducing expenses by replacing higher paid employees with much lower cost right out of college and sending work to low cost countries. It is the perfect time to be an XOM shareholder, though not the best time to be an XOM employee. If you quit, hold onto your XOM stock. And yes, doubling in one year is easily accomplished especially after the O&G companies were decimated due to COVID. Look at other industries that increased several multiples after being decimated by COVID. Like someone else wrote, do your own research and tell me where I am wrong. Give me facts.

Whenever you hear somebody predicting that a long-suffering stock price will more than double in the next year and then finishes by stating “These are facts”, you know right away you’re dealing with a m_oron spewing BS. Which happens to be the very definition of a manager in the company who will miraculously double its stock price (I wish !)

@1sfl+1dhc38iq
“The PIPs may cause lower morale and some regretted attrition, but those regretted can easily be replaced with contract workers, India, Malaysia, and new hires”
Only a pure-bred (or in-bread ?) EM manager could state something as absurd and disconnected from reality as this.
For the last 40 years, including the great downturn of ‘86-‘95, oil companies naively believed that even with all the repeated, massive layoffs and obsessive outsourcing, they still needed to preserve a core of technical expertise and experience.
Lo and behold, EM has finally figured out the great secret: you can get rid of all your experienced workers and replace them with new hires and workers in India, and business will still run nice and smoothly.
Have you tried to get some simple IT laptop issue solved by the service center in Bangalore, without getting zero solutions and having the ticket forwarded to somebody in Houston?
That post author should share with DW a Nobel prize in Economics; our company was already doing sooo good, now it’s going to leave all our competitors in the dust.

Do you realize the same individual that is causing all of the regretted attrition isn’t even supposed to be in charge of SDAC? She stole it from a new dh. None of the present do’s know it’s their job. I hope this is true but more specifically, I hope they get the right ones. They have been grabbing a-s and playing queens and kings long enough. It’s one thing to not do anything productive but when your arrogance causes too much churn, you need to gtfo.

I don’t know if the OP is correct but sounds reasonable. At BR we have a high % of middle and upper management to individual contributors and it is even higher after people were laid off and quit. Based on the number of downvotes it shows the number of middle managers who are on this site. After all, is there any individual contributors who think we need more middle managers who contribute nothing? Anyone see any progress from all of our R&D? Anyone ever get any help from EMRE or just more useless work?

Valuation is, roughly, an estimate of FUTURE cash flows. Everyone has a different way to calculate future cash flows, and using previous cash flows/employees is one of many ratios you can use. But every metric has its downsides. For instance, a startup with hundreds of employees could be cash flow negative and be valued at billions of dollars. And my lemonade stand is cash flow positive with one employee. Which is a better investment? It’s not nearly as straightforward as you present. Even if you took cash flow/employee as the all mighty best metric, which it definitely isn’t, there’s more than one way to change that metric than just releasing 12k people. Not to mention, you cut 12k, that affects the top line too.

Plastic demand is declining? Pretty sure it’s still growing at 3-6% per year right now. We’re not exactly putting all that new plastic in corpus into a black ho-e.

I agree with the poster that said barrels of oil per employee is a useless comparison.

What does matter is cash flow and cash flow per employee is used for comparisons between similar companies. So for the numbers, Exxon cash flow per employee is $509K, chevron is $604K.

Exxon can get to chevrons number by cutting another 12,000 employees.

If 75% of those PIP’d are cut or quit, Exxon needs to PIP 8% for 3 years. Since Exxon is hiring people, the PIPs will likely go longer, that is where the 5 years came from. Exxon is getting rid of the experienced, higher cost employees, those with 14+ years and replacing them with people right out of school at a much lower cost. Since many 14+ employees are gone, those with 10+ years now have a target on their back for next June.

The PIPs may cause lower morale and some regretted attrition, but those regretted can easily be replaced with contract workers, India, Malaysia, and new hires. When those with less than five years quit, Exxon doesn’t lose much since they weren’t really contributing anyway. Eventually Exxon will have replaced the majority of its workforce with new hires and the PIPs can stop for a few years, then repeat the process in 10 years.

And yes, the total value of Exxon can exceed that of apple, it did just that just a few years ago. Do your research and prove me wrong.

OP is taking some small half truths and trying to explain it with the wrong reasons. Could we reach that share price in theory? Sure, we could also surpass amazing and apple combined in 2021, in theory. Very unlikely we hit 120, and it won’t be because of the reasons OP listed. Cutting OPEX can be for many reasons, and 3bil + small increase in dividend + heavily decreased debt raises the stock, but it doesn’t come close to doubling it or more. Maybe 20-30% increase max based on that alone. Also aluminum isn’t just a magical replacement for plastic. It’s more expensive and energy intensive. The problem with plastic isn’t that we can’t recycle it, it’s that we don’t. People don’t actively decide to recycle aluminum MORE than plastic, you’ll still get the same pollution and low level of recycling. It takes ~300 years to decay.

@bhr+1dhc38iq
Check your sources.

Doesn’t matter to me. Handed in my notice today. My pathetic supervisor has to pick someone else to pip next year. Poor witch

Why would bareels of oil per employee be a valid number to compare to Chevron with? We have a massive chemical company that is around #1 in the world by revenue if it were on its own, while Chevron’s chemical assets are all JV’d under CP Chem. Last I checked we were also the largest refiner in the world.

I like crapping all over the company too, but you can do it intelligently.

He's the one handing it out.

@acy+1dhc38iq - What flavor of XOM Kool-aid have you been drinking.?

Sounds reasonable to me. Asset sales are ongoing in Upstream or at least lots of busy work going on prepping for them. In addition to field people going with the assets, won't need all the folks currently working the assets, commercial advisors preparing the sale agreements or technical advisors coordinating the data rooms. Not much new in pipeline so seems like part of the plan to me.

If Xom would just offer a decent incentive package they could easily get the desired workforce reduction numbers. We all know that will never happen though…..

@yqx+1dhc38iq
Unlike a regular layoff, the NSI/PIL/PIP reduces the numbers directly only by a small amount (5-6%/year), while completely destroying morale are generating an uncontrolled exodus of the best people. It is one of the most absurd and harmful “remedies” that an incompetent management can dream of in order to reduce expenses.

At our last quarterly review for the investors, we emphasized that we will save another $3 billion in OPEX in the next three years. The only options to reduce OPEX is to sell assets and transfer the employees along with the asset sale or continue NSI/PIL/PIP/Layoff for the next three years or do both.

Most likely we will pursue both options to achieve another $3 billion in OPEX.

@OP+1dhc38iq
“These are facts”
Your “facts” look exactly like BS to me.

Welcome downstream workplace transformation. Last year it was upstream turn.

I don’t know if the OP is correct but sounds reasonable. At BR we have a high % of middle and upper management to individual contributors and it is even higher after people were laid off and quit. Based on the number of downvotes it shows the number of middle managers who are on this site. After all, is there any individual contributors who think we need more middle managers who contribute nothing? Anyone see any progress from all of our R&D? Anyone ever get any help from EMRE or just more useless work?

Lots of work to do in R&D operations start the purge in PA wing most are useless, drawing big salary’s staring with the DH and group head no research in this zip code for years

This guys good. Now tell me where my girlfriend wants to go out to eat for date night

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