IT Employment

Synergy: Buzzword or code word?

In a previous post I asked TR members to list some of the most hated buzzwords they've encountered. The word Synergy came up quite often. However, is the word more of a buzzword or a codeword? I think it's more of the latter.

In a previous post, I asked TR members to list some of the most hated buzzwords they've encountered. The word "synergy" came up quite often. However, is the word more of a buzzword or a code word? I think it's the latter.

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I recently asked TR members to identify some of the more annoying buzzwords that they're sick of hearing and would like to eliminate from the English language. The response to the poll was good, but there were many more offerings in the comment section. One of the most popular buzzwords that was a candidate for removal was the word "synergy."

That got me to thinking -- is synergy a buzzword or a code word? It seems to me that more often than not, it's a code word --  for everyone's favorite word "layoffs."

Defining the term

Most often you see the word "synergy" bandied about when companies merge. Wikipedia defines synergy as applied to business as:

A corporate synergy refers to a financial benefit that a corporation expects to realize when it merges with or acquires another corporation.

It goes on to identify two types of corporate synergies: revenue and cost:

A revenue synergy refers to the opportunity of a combined corporate entity to generate more revenue than its two predecessor standalone companies would be able to generate.

A cost synergy refers to the opportunity of a combined corporate entity to reduce or eliminate expenses associated with running a business.

Naturally when I refer to synergy as being a code word for layoffs, I'm talking about the cost synergies in that definition. (Expenses is another term that is usually a code word for personnel in many organizations.) Revenue synergies almost always seem to take much longer to achieve and don't have quite the personal impact as cost synergies.

Some examples

Here's some examples of the word "synergy" winding up being a code word for layoffs:

HP, Compaq Join Forces

"The company will be under greater scrutiny since HP began the year with its stock ... structures of the companies may create barriers in achieving synergy."

HP-Compaq Merger Means More Job Cuts

And again when HP bought EDS:

HP in "Advanced Discussions" to Buy EDS

"World leading computer maker HP and Texas-based business services outsourcing titan EDS each issued statements ... There is a lot of synergy that can go on." 

HP Surprises Wall Street with Size of EDS Job Cuts 

HP's not alone however:

IBM Leads the Pack with the Lotus Buyout

"IBM Chairman Lou Gerstner arranged when he completed a hostile takeover ... 'We believe with the synergy of the two companies being brought together'"

Lotus Eliminates 183 Jobs

We could go on and on pulling links like that to prove the point.

The bottom line for IT leaders

Too often today, people don't come out and say what they really mean. They'll bury their true intentions behind buzzwords and code words. Being able to speak in such terms can be handy, and in some organizations it is as important as speaking English. At the bare minimum, you should be able to understand what people REALLY mean when they toss out such words.

9 comments
Tony Hopkinson
Tony Hopkinson

Synergy is meant to be the whole is more than the sum of it's parts. So any business must be synergistic to some extent, otherwise it wouldn't be a business. If you have a synergy, removing one of it's key components, will not improve it, it will kill it. That sort of deliberate misinterpreation, does things like get rid of BAs and have all your developers wear two hats. Even if they were all capable analysts, it's only more efficient if the workstreams allow you time to swap hats, and don't force you to swap them too often.

Flblnezdig
Flblnezdig

In my forty years of business, I have always been taught and heard that Synergy means 2+2=5. In the real world, the truthful and real meaning of synergy is 2+2=3.

jax_cracker
jax_cracker

Off the top of my head? Well, 'Rain Forest' is a well-known wuss euphemism for JUNGLE... 'Global Economy' means screw your local support to make/save a dollar from somebody across the great big ocean.

boxfiddler
boxfiddler

are both tropical and temperate. Jungle references only the tropical.

boxfiddler
boxfiddler

Meant to inspire hope that you may return to your job when things improve, it's not much more than a code word for 'You're fired' these days.

ornelyz
ornelyz

It seems like nobody knows about the systems theory, which defines synergy as "the whole is bigger than the sum of all the parts" inside a system which is "a collection of components (posible systems) which interacts each other to get a result".

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