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Layoffs are not the solution - Nintendo's Iwata

Layoffs are not the solution - Nintendo's Iwata

July 8, 2013 | By Mike Rose

July 8, 2013 | By Mike Rose
More: Indie, Business/Marketing, Recruitment

"If we reduce the number of employees for better short-term financial results, employee morale will decrease, and I sincerely doubt employees who fear that they may be laid off will be able to develop software titles that could impress people around the world."
- Nintendo president Satoru Iwata explains his company's philosophy on staff layoffs.

Rarely a month goes by without us hearing about a notable round of layoffs at a large-scale games company -- yet with regards to Nintendo, you're more likely to hear about executives taking a pay cut, or employee bonuses being dropped.

As part of Nintendo's latest general meeting of shareholders, Iwata explained that while his company's financials may have taken a hit in recent years, firing employees is not the way forward.

"Regarding why we have not reduced the number of the personnel, it is true that our business has its ups and downs every few years," he said, "and of course, our ideal situation is to make a profit even in the low periods, return these profits to investors and maintain a high share price."

He continued, "We should of course cut unnecessary costs and pursue efficient business operations. I also know that some employers publicize their restructuring plan to improve their financial performance by letting a number of their employees go, but at Nintendo, employees make valuable contributions in their respective fields, so I believe that laying off a group of employees will not help to strengthen Nintendo's business in the long run."

"Our current policy is to achieve favorable results by continuously cutting unnecessary expenses and increasing business efficiency," he concluded.

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