Sprint and Managerial Economics 2

Sprint decision to lay off its employees was ill advised, the sacking of its loyal employees was an exhibition of business Myopia, and loyal employees are solid assets that can be relied on even in the most tumultuous times like the ones Sprint Corporation was going through at the time.

The Loyal employees are good at business as they can be expected to put up even with the most unwelcome moves that the firm makes, they are expected to bear with bad times as they have been reaping the benefits during the good times.

In most times the loyal employees have their heart in the business, they have identified themselves with the business , customers on the other hand have identified themselves with the employees , they have build good rapport and their departure is likely to impact the business tremendously and in a negative way.

Sprint Corporation would have explained to their employees the situation that the firm was facing and then give them an opportunity to chose as it happened in the case of Kelvin k company where employees were given a choice to chose leaving the company and seek new and greener pastures. Laying off employees is not a decision that is made in the short term, it is a decision that takes time therefore when the management of Sprint realized that they were headed for bad times they would automatically initiated the idea of voluntary retirement to their employees, in this way the loyal employees would not have felt betrayed.

Sprint received a bad editorial coverage due to its lay off strategy. This included the media where most of the times the media sympathizes with the laid of employees and portrays them

Sprint and Managerial Economics 2

as victims, therefore Sprints consumers may have received the wrong impression of the corporation.

The loyal employees also receive many privileges in the companies including immense trust, this does not escape the eyes of the customers who also in turn trust the employees more, whenever the employees move out of the company and transfer to other companies they make an effort to go with their customers greatly injuring the turnover of their previous company , this should never be allowed to happened particularly to a company that is experiencing financial constraints like Sprint Corporation.

There are other options that Sprint would have followed including reducing employee allowances while awaiting the end of the constraints, those who would have felt that it was too much would have been given the liberty to leave the company and as stated above.

Whenever a company is experiencing difficulties, usually the decision to lay off employees is a last option, laying off Loyal employees is often not an option ,in the year 1998 Longonot company Laid off its 26 employees, in the Operations , and Finance department, among them was the Chief accountant who was viewed by its publics as highly loyal, indeed he was, having worked with the steel manufacturing company for thirteen years, reason for laying the workers off was as a result of low profits resulting from employees theft, bad media publicity and scandals surrounding the company were also cited. After a while the company came to and survived the scandals and started hiring new employees , they hired a new Chief Accountant, he knew that however hard he worked and despite how loyal he would be, he was serving at the pleasure of the management and he would not be recognized, he had learnt all that from the experience of his predecessor and each day as he came to work he was preparing to leave, indeed after only eight months at the company , the chief Accountant left and left with six of the eleven employees at the Finance Department, the company was affected profoundly and had been affected for having not rewarded its loyal employees, actually bad decisions of the past were haunting Longonot company.

Sprint and Managerial Economics 2

In house policy and style is a very important part of economic management, this is emphasized by Magdalene W an accountant .and writer in her Thesis All in Economics.

Most loyal employees are well acquainted with in house styles and laying them off is tantamount to selling policies and styles to rival companies, ostensibly though Sprint was Merging with Nextel, most of its policies were sold to AT&T Inc. and Verizon and their other rivals in the communication business .Training new staff with an intention of making them adapt the in house style and other policies involving the company may be part just what the corporation needed to turn over, new employees do not become productive overnight and Sprint may have learnt this the hard way .

Sprint does not indicate that after laying off its employees and particularly its second batch where it laid of its loyal employees, it started making profits , this deafening silence obviously indicates that it could have realized how wrong they were.

Communication channels in the corporation may have been severed as result of laying off the loyal employees, the remaining employees would not be in a position to know who would be next. In corporations where sound decisions are made, usually disloyalty to the firm is used as the major criterion when commissioning redundancy, the employees are always on the know on who’s next, but when loyal employees are the target then mistrust creeps in among employees, and also among those in management .Productivity is also hampered as a result of jitters from the laying off.

Time is of the essence in any business. Sprint Corporation may have wasted of time while trying to reorganize itself and while trying to look for replacement for the loyal laid employees.

Sprint and Managerial Economics 2

It is not reported anywhere that Sprint closed some or any of its branches , the question that begs is who would do the work that was being done by those who had been laid off.

The bottom line is that Sprint Corporation did a tremendously bad mistake by laying off its loyal employees; the decision would live to haunt the corporation regardless of whether it merges with blue chip companies like Nextel. It acted in total disregard of economics prudence.


Agola A (2008) Finances and Management, McGraw Hill Press, New York

D. Cooper and P. Schindler (2005) business economic methods, MIT press, London

Stratton (1999) Economics: A New Introduction, McGraw Hill Publishers, New York