Dotcoms lose their sparkle as jobs go
Dotcom companies are running the risk of becoming 'pale imitations of old economy companies' as bosses put experience above talent in a sector characterised by heavy job losses and consolidations.
A new survey by Big Five firm PricewaterhouseCoopers titled Focussing on fundamentals – dotcoms mean business found that much in the industry had changed since last year, as a third of dotcoms report staff cuts.
Most significantly, companies are now asking recruitment professionals to hire ‘experienced management’ types with one in four CEOs citing this as a pre-requisite for potential employees, above traditional new economy attributes like creativity and flexibility.
Kevin Delaney, a partner at PwC HR Consulting said there was a ‘growing bunker mentality’ as dotcom CEOs placed ‘profitability and the bottom line’ above ‘creativity and risk taking’.
With dotcom job cuts making business headlines on an almost daily basis, the new strategy of taking on management level employees could leave staff feeling disillusioned and reduce motivation levels, the firm said.
Delaney added: ‘The danger is that dotcoms will lose the excitement, energy and sense of fun that made so many talented people want to become involved in the sector in the first place. While more than three-quarters of UK dotcom employees still view their job as “fun”, retaining that element of fun will be vital in the future motivation of staff.’
PwC said it was important that HR professionals ‘recognised and retained the magic’ in their business, while at the same time ensuring the right balance of relevant management experience and a ‘passion for working in new ways’.
A report in today’s Telegraph reported that US recruitment company Challenger, Gray & Christmas has said 125,000 dotcom employees had lost their jobs this year, cutting the workforce by half.
High-profile casualties this year include online grocer Webvan.com in the US and online accountants Ascot Drummond – which has called in the administrators, music retailer Boxman.com and e-tailer Urbanfetch.com in the UK.
Despite this poor outlook, there are some positive signs on the horizon, particularly among travel companies. Earlier this week, Priceline.com announced its first ever profit, while closer to home EBookers.com has more than doubled its work force.
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