Thanks for the hard work. You’re fired.

Profits don’t mean jobs, anymore. That’s the reality of the economy in the 21st century.

Thomson Reuters, a company with major Twin Cities operations, showed that today when it announced its financial unit’s first positive net sales quarter first quarterly profit since 2011.

Good news? Not for the thousands of people the company said will now be let go.

The memo from CEO Jim Smith calls this “the next level of performance.”

Dear Colleagues,

At the beginning of the month, I thanked you for all the work that has gone into building a solid foundation for our future success. Today, you can see the proof in our third-quarter performance.

I was particularly pleased to report that our Financial business achieved positive net sales for the first time in more than two years. This represents an important milestone in returning our Financial business to a growth footing. And it was one of several milestones achieved during the quarter.

As of this month, more than 100,000 Eikons have been installed on customers’ desks.

And finally, after years of talking about the need to replace our legacy Bridge Data Network, we migrated more than 17,000 Bridge users to Eikon and Elektron. I want to thank the teams who worked tirelessly to shut down Bridge on time and with minimal disruption to our customers.

This was the third major platform closure we’ve completed this year, and each one was completed on-time and on-budget.

With our Financial business back on a solid footing, it is time to press the accelerator and take Thomson Reuters to the next level of performance. How do we go from “good to great”? How do we deliver an even stronger value proposition to our customers? How do we build on our recent success and unlock the incredible talent inside this company? How do we improve our speed to market? How do we build even greater value for all our stakeholders?

The answer is to accelerate our evolution into a platform company – one that delivers to customers not just a portfolio of products, but the power of our entire enterprise. We have made progress on that front, but there’s still much to be done. To take the next step, today we set aside funding to further accelerate the transformation of our Financial business and to better align resources to our most promising opportunities.

We will eliminate approximately 3,000 positions as we continue to reduce product and operational complexity across our company. And we will focus our resources on supporting front-line teams on the ground in markets with the greatest potential for growth.

As we make these changes, our first priority will be to help the people impacted by these moves to find alternative jobs. These are tough decisions that we do not take lightly. But I thoroughly believe these steps are necessary to position our organization to thrive for years to come.

As I said a few weeks ago, we are beginning a new chapter in our company’s evolution. We’ve created the footprint and assembled the assets we need to win. The success of Eikon, Elektron and our unified platform has turned the tide for our Financial business. Now is the time to take decisive action and build from this position of newfound strength.

Some of the early steps in our journey will be difficult. We won’t get there overnight. But I assure you – we’re on a journey well worth taking.

Thank you for your hard work and continued support.

Sincerely,

Jim Smith
Chief Executive Officer, Thomson Reuters

After the announcement that people were losing jobs, investors ran the company’s stock up more than 2 percent in early trading.

(h/t: Romenesko)

  • Roger

    Couldn’t he have waited a few weeks between the “thank you” and the “you’re fired”?

  • Starquest

    I think I won BS Bingo!

    - accelerate our evolution
    - value proposition
    - speed to market
    - further accelerate the transformation
    - focus our resources
    - better align resources
    - reduce product and operational complexity
    - tough decisions
    - position our organization

    I wonder if I could make money selling software that would spit out this BS memos. That would save CEOs time and money that could be better spent improving synergy and building core competencies. Also, paradigm.

    • Chuck

      If you could create that software, companies could then “right-size” their CEO–who wouldn’t be needed to write the memo–thus saving even more money! You’re really on to something.

  • John Peschken

    I’ve seen that before. I found myself “restructured” out of a highly profitable company after 25 years. About 1/4 of the employees were restructured with me. Six months previous, we were told make certain goals or heads will roll. We made the goals, but heads rolled anyway.

    No matter how much a company makes, it has to be more next quarter. Laying people off and forcing the survivors to work more and more hours is seen as productivity enhancement. I’m glad that I am close to retirement.

  • Matt Wells

    Please correct “announced its first quarterly profit since 2011.” The statement in the release is “Our financial business recorded positive net sales for the first time since the second quarter of 2011. ”

    Thomson Reuters has made a profit pretty much every quarter. ($548m YTD according to the release).

  • John

    Ah, growth through reduction.

    This looks a fair amount like the beginning of a death spiral to me – but they seem to be getting out ahead of it by laying people off before the drop in profits hits. Just keep cutting away the things that make the least money, pretty soon you won’t have any bottom performing platforms left (you won’t have any top performing platforms either, but hey – no worries).

    We’ll see what happens, but with the economy and job markets ostensibly improving, people will hopefully soon be able to have a bit more to choose from when hunting for work. Moves like this for short term gain, if applicants remember them, will make the company a tough sell to the best applicants. I know I have a list of companies I won’t consider applying to work at (given that I am not in desperate need of a job), based on historical treatment of loyal employees.

  • Andy

    Not certain what is the bigger indictment of our current business/economic world: the fact that he sends this glowing letter of improvements but is completely tone deaf to the abrupt change in his letter as he announces that he’s firing 3,000 people or the fact that the stock market then rewards this breach of respect and humanity by making this c.e.o. 2% richer (which is probably at least my yearly teacher’s salary and then some)….boy do we live in great times or what? (excessively dripping sarcasm, there.)

  • bri-bri

    “But I assure you – we’re on a journey well worth taking.”

    A journey to fat stacks of cash for executives and large shareholders: Truly beautiful.