61.        A director of Beta Company suggests that Beta can improve its competitive
position by hiring a significant number of former Alpha Company employees who have
recently retired¹ or been laid off. The director's reasoning is that because Alpha
manufactures some products similar to Beta's, former Alpha employees would be
experienced and need little training, could provide valuable information about Alpha's
successful methods, and would be particularly motivated to compete against Alpha. The
director's argument is problematic in several respects.
      First of all, the argument presupposes that Alpha's methods are successful. This is
not necessarily the case. To the contrary, the fact that Alpha has laid off 15 percent of its
employees in every division and at every level suggests that Alpha's methods may have
been unsuccessful and that downsizing was necessary for the company to minimize
financial losses.
      Secondly², the director assumes that the former Alpha employees hired by Beta
will be well-trained and valuable. During a typical lay-off, however, the best and most
experienced employees are typically the last to be laid off. By following the director's
advice, Beta would probably be hiring Alpha's least efficient and least experienced
employees—that is, those who would be least valuable to Beta.
      Thirdly, the author assumes that Alpha and Beta are sufficiently³ similar so that
former Alpha employees could provide special value for Beta. However, we are
informed only that Beta manufactures "some products similar to Alpha's." It is possible
that former Alpha employees have experience with only a small segment of Beta's
product line, and thus have little inside information of any value to Beta.
      Finally, the claim that former Alpha employees would be motivated to compete
against Alpha is partially⁴ unwarranted. While many of those who were laid off may be
so motivated, those who retired early from Alpha probably departed on good terms with
Alpha, and would in any event be unmotivated to reenter the work force.
      In conclusion, the argument fails to provide key facts needed to assess it. To better
evaluate the director's suggestion, we would need more information about why Alpha
reduced its work force, what type of workers left Alpha and under what circumstances,
and how similar Alpha's range of products is to Beta's

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