I was asked this question today, and I think it deserves a little bit of discussion. I will share my take on the subject, and then share the opinions I received from several of my friends on Twitter. Feel free to add your comments.

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Written by ShawnHessinger
4449 days ago

Hi Ken,

A quick question that really has nothing to do with slow or fast. I don't know whether or not you have ever read Seth Godin's "Death Spiral" post at his blog. I think it is also linked to from BizSugar somewhere. Though I find Seth's take perhaps a bit naive believing that growth can always be achieved in a shrinking market, I do question as a small entrepreneur who understands only too well the impact of limited resources on expansion how layoffs can ever truly put a company back on track? It seems to me that only a company that expanded adding jobs needlessly can benefit from trimming fat. For most, I think it will lead to a spiral like the one described by Seth where less resources brought on by less revenue will in turn lead to less output. (More efficiency is most likely an unattainable dream.) Less output will likely lead to less revenue which will again force a reduction of resources. Without more business it seems to me any company is doomed and is not really trimming fat so much as sinew and muscle.



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Share your small business tips with the community!