Context
Between 2017 and 2019 WeWork hired aggressively, fired aggressively, and reorganized constantly. Headcount went from 3,000 to over 12,000. Performance management was inconsistent across the company; severance practices varied wildly; senior departures were frequent and often involved restrictive NDAs.
Decision
Leadership treated People as an extension of founder will rather than as a function with its own discipline. There was no consistent compensation framework, no published performance philosophy, and a pattern of high-velocity hiring and firing that signaled to staff that nothing was permanent. The CHRO role turned over multiple times in two years.
Consequence
When the failed IPO process began in August 2019, the People function had no organizational memory to rely on. The 2,400-person layoff that followed the IPO collapse was executed under maximum chaos — affected employees learned via news leak in some cases. Class action lawsuits followed. The brand has not fully recovered as an employer.
“The People function needs operational discipline that survives the founder.”
— the lesson, in one line
Lesson
The People function needs operational discipline that survives the founder. If your CHRO turns over every nine months, you do not have a People function — you have an extension of the CEO's preferences. Build the function before you scale.
What most retellings miss
Five CHROs in two years was the leading indicator. Investors should have priced the missing People function 18 months before the S-1 made the financial story public.
Sources
HR Asia case studies are editorial analysis of public reporting and on-the-record interviews. They are not legal advice and do not reflect the views of the companies covered.
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The WeWork case study on HR Asia is uncomfortable reading. The People function needs operational discipline that survives the founder. If your CHRO turns over every nine months, you don't have a People function — you have an extension of the CEO's preferences. https://hrasia.co/cases/wework-pre-ipo
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