The Idea

Common sense advises that quits and job openings are somehow connected. The most compelling explanation would mention the following factors:

• for employees to quit there must exist some other jobs at which these employees can work;
• companies need to be actively hiring in order to create a pool of jobs large enough for employees to choose from and find a suitable new workplace;
• job switch takes some time, hence job openings should be created in advance so that employees can negotiate the new contract terms and other details before they decide to quit;
• the new jobs need to be offering financial or career improvements for someone to be eager to leave the comfort of their current working place.

The Model

The chart below based on BLS monthly data for the years 2001-2021 shows that most of the factors mentioned indeed seem to be relevant to the actual quits process.

Job openings show a close connection to the workers’ decision to leave their current workplace. Note that the jobs created are shown on the chart with a one month lag. It is clear that the more job openings were generated by the economy in the previous month the more quits follow in the next month. Naturally, data seem to confirm that the process goes like this: employees see that new opportunities exist and that there’s is a sufficient pool of new openings to choose the fitting new career, so they take some time to make the necessary arrangements and finally do switch their jobs.

Checks

Several robustness checks were performed. Among them were using other lags and more lags for the job openings variable, using non-employment-weighted absolute values for both parameters, adding other possible variables (the same BLS report data parameters, e.g. layoffs and discharges, were used as an alternative reason for leaving the job). However, the basic results stay stable and continue to imply a strong connection between job openings and quits. At the same time, the increased pay or other income influence on quits (the 4th bullet in the list above) has not been checked in order to keep the model simple. Nevertheless, all the results here should be taken with great caution and used only as the first step for more serious and profound analysis.

Conclusion

In conclusion, a handful of observations regarding the Great Resignation can be made even with such a simplistic model:

• people tend to wait for the real opportunities to appear, they usually do not quit to nowhere;
• the current increase in resignation fits nicely to the historical data patterns;
• it is highly likely that as the employment pick up subsides, the quits wave will also go down.

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The Taiwanese semiconductor giant is showing consistently strong economic performance. The overall revenue for January to July 2021 was about US$31.1 billion, up 18.1 percent from the same period in 2020. TSMC approved capital appropriations of approximately US$17.5 billion for several high-tech areas.

All the company’s efforts are focused on the technology to improve transistor performance and reduce manufacturing costs. Most of the success of the semiconductor industry can be attributed to the successful scaling of the transistor in size. But the sizes of transistors have reached their limits. Physical principles do not allow making transistors even smaller. Therefore, the first priority area is R&D capital investments and sustaining capital expenditures.

New device technologies and logic can come to the rescue. Understandably, TSMC directs huge cash flows to the development in various areas:

• naturally new principles of logic,
• development of new structures of the transistor or the improvements of the old ones,
• modification of the active region of the transistor to increase energy efficiency (channel with high mobility),
• devices and components with small dimensions (this is when there are materials in devices that, for example , several atoms in thickness),
• new technologies for creating memory components, and much more.

Nevertheless, investing in these areas carries great risks. Much research will go nowhere, and many will become obsolete before serial and mass production equipment is available.

Therefore, the following priority areas are installation of advanced technology capacity and mature and specialty technology capacity, upgrade of advanced packaging capacity, manufacture construction and installation of facility systems. For semiconductor companies to stop is to lose. Thus, innovation, as well as research and development will be the mainstream strategy of the industry leaders.

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fig 1. The Depths of the corona crisis Left chart: World GDP and trade dynamics (actual till 2020, IMF forecast for 2021-22). Source: IMF data Center chart: Apple mobility trends for G7 countries. Source: Apple Inc. Right chart: VIX index. Source: CBOE

Then, in September-December 2020, came the stabilization at the bottom. Situation calmed down albeit at the very low levels. Indeed, the depth of the fall varied with activity in many services sectors ground to a halt, while in sharp contrast to many previous crises manufacturing and investments did better, as well as the financial sector. However, in general the panic leveled out and CEOs and corporate strategists started thinking about the life after the crisis.

fig 2: Employment by sector. Source: OECD data

Since the start of 2021 the hope and the rebound have come. Multiple vaccines approval allowed to start the immunization process. The rates of vaccination are different by country but the world in general seems to be on the right track, so achieving herd immunity looks like a question of time. Managers’ optimism has also picked up in the recent months and now everybody is hastily developing the best strategies of corporate development for the years to come.

fig 3: PMI by country. Source: Bloomberg

So what should you look at when developing you company’s strategy in the not-so-brave new world?

To use a simple rule-of-thumb approach there are 3 key factors to consider:

• the prospects for dealing with the disease itself;
• the persistence of the social distancing measures and popularity of distance work after the pandemic is gone;
• the pace with which the major policymakers will be curbing fiscal and monetary stimuli.

So here these factors are grouped and ranged by the 3 major scenarios that any meaningful strategy usually considers. The strategic horizon is 3 years.

So you decide on the probability of each scenario and then you create your strategic growth plan placing resources accordingly. In any case, you company’s growth strategy should also take into account the industry your company is working in: services sectors are to stay more influenced by the future rebound dynamics than the rest parts of the economy.

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The number of manufacturers producing microcircuits grows exponentially as the technology becomes more complicated.

Moore admitted in 2003 that due to technological limits, exponential growth will not be achievable in the future. He announced in 2007 that the law would be repealed soon. The number of transistors on an IC is mostly adjusted by reducing the size of the transistors. However, the dimensional restrictions of the conventional transistor generate undesired effects when it is reduced. Furthermore, IC manufacturing technique has its own set of constraints. Device designs must be improved on a regular basis, or breakthrough technology must be made available. Scientists and engineers are working on new ideas, but semiconductor technology will eventually approach its limit. New techniques are required on a fundamental level. Spin transistors, for example, are being studied, in which the operating principle is altered from an electron charge to a magnetic moment. One of the most important conclusions drawn from this law is that as processing power increases, the cost of computing equipment decreases. The cost of producing a transistor has fallen thousands of times in the last 50 years. Every home today has access to a computer. As a result, we now live in the digital era. We can’t picture modern business without business process automation tools. Furthermore, all traditional marketing has been supplanted by digital marketing. AI, big data, and remote work are all products of the advancement of technology. Two-dimensional materials have been around for less than a decade, and there are now a slew of electronic component solutions based on them. New technologies and core work principles will undoubtedly assist in breaking through this barrier.

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Shipbuilding is considered a conservative industry, and for a good reason. Steel ships had been first commissioned in 1870s, and while riveting was replaced by welding, dry docks became common for ship hulls assembly (instead of inclined slipway), and large-block assembly improved the building time and economics, the very nature of the vessels built did not change much. However, with advances in light materials and fluid mechanics, a totally new breed of ships emerged, capable of moving with speeds unthinkable of, or barely attainable by traditional commercial vessels.

The business case for these high-speed vessels was dual. First, it complemented traditional passenger vessels (e.g. ferries) on sea routes with high passenger volumes and short-to-moderate (tens to low hundred miles) distances – a class of high-speed ferries. Second, it became an important component of navies across the world, especially those operating in “narrow” seas and/or having serious Marine forces that need a reliable tool for landing on an unprepared shore

Along with Soviet hydrofoils of Alekseev Design Bureau, an early example of successful hi-speed vessels were The La Manche hovercrafts of Mountbatten class capable of carrying 400 passengers and 60 vehicles across the Channel in about half an hour. However, increasing fuel cost in the post-1973 world, and subsequently the Tunnel have put these famous high-speed vessels out of service. In the 1980s, a more energy-efficient and seaworthy class emerged, the wave-piercing catamarans and trimarans with narrow hulls of great elongation. By its very nature, they can carry far greater payloads than vessels with dynamic support like hovercrafts and hydrofoils, and at a fraction of cost. The first large vessel of this class, a 28-meter Spirit of Victoria, entered service in 1985, and since then there was a marked growth in size and deadweight, the largest modern ones being over 100 meters long and having deadweight in thousands tons

The past and present leaders in this segment of shipbuilding industry have varying pedigree. The La Manche hovercrafts were built by British Hovercraft Corp. that had been created through a merger of the respective divisions of Westland Aircraft and Vickers Supermarine, both reputed names in the aviation world. Incat, on the contrary, developed itself from a conventional Australian shipyard specializing in conventional ferries, Sullivans Cove Ferry Company (SCFC). It was both ship constructor and operator of a ferry line between Australia and Tasmania, and this combined business model was likely to give an in-depth understanding of passenger needs and nuances of running a busy ferry line (for some time after collapse of the Tasmanian Bridge, ferries were the only means of day-to-day commuting between the island and the mainland). Through some changes in ownership (still remaining a private business owned by the founding family and partly by the employees) the company expanded its operations well beyond the Southern Hemisphere, becoming one of global leaders in its segment. However, no advantage in this world is forever, and new contenders come to the market fromChina.

Andrew Yashin, strategic analytics and consulting expert

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It’s been more than half a year since the start of total lockdown. In USA, just a small percentage of employees have returned to their offices. Most of companies have already adapted to the new reality, with remote work environments and videoconferences through certain applications. Some of these companies are looking at lower productivity and financial output, but others are doing quite great – and those “others” are the ones who really drive the market forward.

What’s the secret for successful remote work? Firstly, the organizational structure should be flattened and decentralized to compensate for low amount of communications outside the office. So, employees must have some freedom and make their own decisions for non-essential tasks. Secondly, employees who are doing intellectual work now can be hired from the whole world, which greatly expands the horizon for talent scouting. Thirdly, all the work should be concentrated in a single environment to decrease non-productive time for switching between apps and writing countless emails. As a result of all these initiatives, the company might have to reinvent itself. But then there would be no actual reason to move workers completely back to office, aside from core essentials, as remote work would be just as efficient with less costs.

The post Is it Possible to Permanently Move Workers Out of Office? appeared first on strategy observer.

Let’s just take a look at some of the official data that Amazon has provided.

First of all, some main steps were approved for employees. Amazon offered over $500 million as Thank You bonus, invested approximately $4 billion on COVID-related initiatives to keeping employees safe, established a $25 million relief fund for parners (e.g. delivery drivers) and seasonal associates facing financial hardshipa and so on.

In addition to obvious actions for clients such as providing free masks to customers, cleaning at all Amazon physical stores, Amazon has made some interesting decisions. For instance Whole Foods Market stores have dedicated shoping hours to 60+, with disabilities and hihg risk customers. Amazon also combats price gouging to help protect customers, helps ensure fair pricing, and combats those seeking to profot off the COVID-19 crisis.

And finally, serious steps for society as a whole: $20 milliion AWS Diagnostic Initiative, $23 million to support those most affected by the pandemic in Europe, Amazon Founder donated $100 million to Feeding America, over 12,000 pupils got laptops.

And this is not a complete list of good deeds.

Of course, this is all part of the marketing strategy. This strategy may seem too expensive and it is effectiveness can not be evaluated soon However, a company that has managed to increase its market cap from 900B to 1.6T since start of pandemic can afford such “humane” strategy. Formation of loyalty to a brand / company / corporation is now the main task of any marketing division. An illustrative example is the publication on the official Amazon website dedicated to the new chief marketing officer. In addition to describing the achievements of the specialist, the following thought was formulated «She will help to develop an even stronger emotional connection with our audience». We believe that this cutted out of context phrase characterizes one of the main tasks of modern marketing. We formulated the task as follow: “Make the client your advocate”.

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