Hyland Software Layoffs: Navigating Transformation Amid Economic Challenges

Introduction

Hyland Software, a prominent enterprise content management (ECM) company based in Westlake, Ohio, has long been recognized for its robust software solutions and a corporate culture that emphasized familial values. However, recent developments have marked a significant shift in the company’s trajectory. In April 2023, Hyland announced the layoff of approximately 1,000 employees, accounting for about 20% of its workforce. This article delves into the factors leading to these layoffs, the impact on employees, and the broader implications for the tech industry.

Background of Hyland Software

Founded in 1991 by Packy Hyland Jr., Hyland Software developed OnBase, an ECM and process management software suite utilized across various sectors, including healthcare, finance, and government. Over the years, Hyland expanded its global footprint, establishing offices in multiple countries and acquiring companies like Nuxeo to bolster its cloud offerings.

The 2023 Layoffs: An Overview

On April 3, 2023, Hyland’s CEO, Bill Priemer, announced a significant restructuring effort resulting in the termination of approximately 1,000 employees. The layoffs spanned various departments, including research and development, sales, and account management. Employees reported receiving notifications via email, followed by a virtual meeting where the CEO addressed the company’s future, albeit without an opportunity for questions.

Factors Contributing to the Layoffs

Economic Pressures: Hyland cited inflation, rising interest rates, and increased wages as significant factors impacting its expenses. These economic challenges, coupled with clients reducing their technology expenditures, strained the company’s financial stability.
Debt and Financial Strategy: Hyland’s history of funding growth and acquisitions through debt, including a proposed $450 million dividend financed by new loans in 2018, contributed to its financial duress, especially amid surging interest rates.
Transition to Cloud Services: The company’s strategic shift towards becoming a cloud-first platform required substantial investments in systems and personnel. However, the anticipated returns from this transformation were not realized as expected, leading to further financial strain

Employee Reactions and Cultural Impact

Hyland’s corporate culture, which emphasized a familial atmosphere, was significantly affected by the layoffs. Employees expressed feelings of betrayal and disappointment, particularly regarding the manner in which the layoffs were conducted. The sudden notifications and immediate revocation of network access left many feeling disillusioned.

In response, affected employees organized support networks, including Slack channels, to share job opportunities and provide mutual assistance during the transition.

Previous Layoffs and Outsourcing

This was not Hyland’s first round of layoffs. In January 2021, the company laid off approximately 140 employees from its Product Delivery department, while simultaneously announcing plans to hire over 300 technologists, primarily in India and Poland. The move was part of a broader strategy to expand its global footprint and transition to a cloud-first platform.

Industry-Wide Trends

Hyland’s layoffs are reflective of a broader trend in the tech industry, where companies are restructuring in response to economic pressures and shifting market dynamics. In the first quarter of 2023 alone, over 166,000 employees from more than 550 tech companies were laid off. These industry-wide reductions underscore the challenges faced by tech companies in adapting to post-pandemic market conditions.

Support for Affected Employees

Hyland has stated that laid-off U.S. employees will receive a minimum of three months’ severance, five months of healthcare coverage, and access to career resources to assist in their job search. Despite these measures, the suddenness and scale of the layoffs have left many employees grappling with uncertainty.

Life After Layoffs — Internal Restructuring and Strategy Realignment

Rebuilding the Core

After the departure of approximately 1,000 employees in 2023, Hyland’s leadership signaled its commitment to restructuring and enhancing organizational agility. The layoffs were not merely a cost-cutting move—they were intended to eliminate operational redundancies and accelerate the shift toward cloud-based service models.

The company invested heavily in revamping its core departments, especially product development, DevOps, and customer support. Key initiatives included:

Agile Transformation: Implementing Scrum and SAFe frameworks company-wide.
DevOps Modernization: Automating more CI/CD pipelines to boost deployment efficiency.
Hybrid Workforce Model: Allowing remote flexibility while optimizing in-person collaboration in strategic hubs like Westlake, Ohio; Kraków, Poland; and Hyderabad, India.

Executive Reshuffling

Following the layoffs, Hyland brought in new leadership talent to drive transformation. A few significant moves included:

Chief Transformation Officer (CTO): A newly created role focusing on cloud migration.
Chief Human Resources Officer (CHRO): Tasked with rebuilding internal morale and refining talent acquisition strategies.
VP of Cloud Services: Leading the productization and scalability of Hyland’s OnBase and Alfresco cloud platforms.

The Employee Perspective — Resilience and Transition

The Aftermath

The psychological impact of being laid off during what many believed was a stable career with a company known for its “Hyland Family” culture was deeply felt. Former employees shared stories of sudden transitions, emotional disorientation, and career reevaluation.

However, a strong network of alumni emerged, facilitated by LinkedIn groups and private Slack communities. These became platforms for:

Peer support and mental health resources.
Resume review and interview preparation.
Job leads and referrals.

Career Outcomes

Interestingly, a significant percentage of affected employees found new roles within six months. They were hired by competitors, startups, and even Hyland’s enterprise customers. Many landed in:

Cloud-native tech firms (e.g., Snowflake, AWS partners).
FinTech and HealthTech startups.
Remote-first global SaaS companies.

This diaspora of talent has spread Hyland’s DNA across the industry, creating a lasting impact far beyond its original footprint.

Part III: Customer Reactions and Retention Challenges

Navigating Uncertainty

Hyland’s clients—ranging from hospitals to banks to government institutions—expressed concern over the layoffs. Key areas of worry included:

Continuity of customer support.
Reliability of implementation timelines.
Uncertainty around long-term product roadmaps.

Hyland addressed these concerns through proactive customer engagement, including:

Quarterly Town Halls with enterprise clients.
Dedicated Account Transition Managers for accounts impacted by staff turnover.
A Customer Assurance Program providing guarantees for SLAs and implementation dates.

Retention Rates

According to third-party research firms tracking ECM vendor churn, Hyland’s customer retention remained relatively strong post-layoffs, with an attrition rate hovering around 12%—a slight increase from 9% the year prior. However, the company acknowledged that without increased customer satisfaction, this could worsen.

Part IV: A Competitive Landscape in Flux

Industry-Wide Comparison

Hyland’s restructuring mirrors similar trends seen at major software vendors like:

Salesforce: Cut 10% of its workforce in early 2023 while pivoting to AI-infused CRM features.
Box: Streamlined operations and refocused on vertical-specific ECM offerings.
OpenText: Acquired Micro Focus but downsized overlapping teams post-merger.

In contrast, Microsoft and Google Cloud doubled down on AI and cloud infrastructure, resulting in hiring booms rather than layoffs. Hyland, however, sits at a critical junction—too large to pivot like a startup but not quite big enough to absorb shocks like hyperscalers.

Disruption from Startups

Several ECM startups are capitalizing on Hyland’s restructuring:

DocuWare, Laserfiche, and M-Files have intensified sales efforts, specifically targeting sectors where Hyland was historically dominant.
Startups offering AI-native document management solutions are gaining traction with mid-market clients seeking lower implementation overhead and faster ROI.

To stay relevant, Hyland must not only stabilize but innovate.

Part V: Cloud Transition — Slow but Steady

Cloud-First Reality

Hyland’s shift from on-premise to cloud-first services was a key driver behind both the layoffs and ongoing transformation. Despite setbacks, progress continues. Key stats include:

Cloud deployments accounted for 43% of new sales in 2024, up from 28% in 2022.
OnBase Cloud now boasts multi-tenant architecture and FedRAMP authorization, essential for public sector expansion.
Alfresco Content Services integrated with Kubernetes for scalable, containerized deployments.

Challenges

However, cloud migration isn’t without pain points:

Customers report complex licensing models.
Data migration projects are often lengthy and expensive.
Customization limitations in cloud versions compared to on-premise deployments frustrate longtime users.

To address this, Hyland is streamlining its pricing, improving documentation, and investing in onboarding tools to ease cloud adoption.

Part VI: Looking Forward — Strategic Roadmap and Future Outlook

Focus Areas for 2025 and Beyond

Hyland’s leadership has outlined a multi-pronged strategy for recovery and long-term relevance:

Customer-Centric Innovation:
- Greater integration with Microsoft 365, Salesforce, and ServiceNow.
- Launch of AI-enhanced search and document classification tools.
Global Delivery Model:
- Expansion of nearshore and offshore development teams.
- 24/7 multilingual customer support through regional hubs.
Sustainability Initiatives:
- Committed to net-zero cloud operations by 2030.
- Leveraging energy-efficient data centers for cloud hosting.
Employee Engagement:
- Launch of the “Hyland 2.0” culture initiative focusing on transparency, inclusion, and adaptability.
- Revamped performance and feedback systems.

Analyst Predictions

Industry analysts are cautiously optimistic. Gartner notes that while Hyland’s transition is fraught with risk, the company’s robust legacy, strong leadership, and consistent customer base give it a fighting chance.

Forrester predicts that by 2026, Hyland could regain its pre-layoff growth trajectory—if it can balance innovation with operational stability.

Conclusion

Hyland Software’s recent layoffs highlight the complex interplay between strategic business decisions and economic realities. As the company navigates its transition to a cloud-first platform amid financial pressures, the impact on its workforce and corporate culture is profound. The situation serves as a case study for other tech companies facing similar challenges, emphasizing the importance of transparent communication and support for employees during times of organizational change.