The Real Reason Your Firm Missed 2025 Targets - And Why Layoffs Won’t Save 2026

A number of technology services and custom software firms are making the same move right now: layoffs.

One firm I am close with, like many others, just cut a group of customer-facing sales reps and tech sales support roles because they missed their 2025 targets and do not have the pipeline to justify them in 2026.

I reached out because I know exactly why they are in this position and what it would take to fix it.

Their response was simple:
"We need better salespeople. We do not need outside consultants."

That mindset is exactly why they are struggling.

Layoffs Are Not a Strategy. They Are a Symptom.

Sometimes headcount reductions are unavoidable due to client ramp-downs, shifts in focus, or correcting past hiring mistakes. It happens.

But firing people without addressing the root cause of why growth stalled is the height of immaturity.

If 2025 was a rough year and your 2026 pipeline is shaky, yes, reduce headcount if you must.
But the real question is:

What else are you doing about it?

Because if all you are doing is cutting payroll and hoping for better market conditions, you are not leading. You are guessing.

If this feels familiar, I talked more about this dynamic in "Stop Searching for Silver Bullets" where many teams avoid foundational fixes and hope the next hire or next market trend saves them.

The Hard Questions Most Leaders Avoid

Before you fire another salesperson, ask yourself:

• Is your pitch and value story optimized for the current market?

• Do your remaining people even know how to communicate that story?

• Are your account expansion efforts structured, aggressive, and consistent?

• Do your remaining people know what effective account expansion actually looks like?

• Have your offerings been refined to meet the needs of 2026 buyers?

• Is your value proposition being marketed, sold, and delivered consistently?

• Are your operational systems mature enough to help you identify downturns early so you can adjust?

And the final question: Who is left that knows how to fix any of this, what are they doing to fix it, and when will it be complete?

Cuts reduce cost.
They do not build competence.

Most firms never confront these questions, which is why their revenue engines remain fragile. The root issue is almost always the same: leaders that have never fixed unclear positioning, an unfocused offering, inconsistent sales execution, and operational immaturity.  That’s not an attack on those leaders, they simply haven’t done it before and need help fixing those things so they can better leverage their team members. 

Until a company aligns what it sells, how it sells, how it delivers, and how it markets, no amount of hiring or firing will fix the foundation.

Why Most Firms Stay Stuck

Here is the uncomfortable truth:

Most companies make reactionary headcount cuts because they lack the maturity, experience, and operational systems required to be proactive.

They do not course-correct early.
They do not refine their offering often enough.
They do not build the marketing and sales discipline required to stabilize revenue.
And they are too proud or too unaware to ask for help.

So they fire people.
Then hire new people.
Then fire those people later.

And the cycle continues.

If this resonates, you may also find value in "The Maturity Gap Is Killing Tech Services Firms" which explains why firms keep repeating the same mistakes.

If that feels familiar, you are not alone and you are not doomed.
You simply need a different operating model.

This Is Where ROI Helps

At ROI, we have spent decades helping technology services firms break this cycle and grow intentionally, even in down markets.

We know exactly how to:

• Evaluate your team and understand who can execute

• Refine your pitch and narrative so it resonates in the market

• Create a differentiated value proposition and ensure it is marketed correctly

• Improve operations so you see performance shifts early and respond proactively

• Execute against defined due dates so progress is measurable and consistent

Most importantly, we build the capability inside your organization so the next downturn does not take you by surprise.

You can see how this works in practice in “How to Achieve 30% Growth in Today’s Tech Services Market”, which outlines the exact foundational shifts required for real scale.

Do Not Rely on Financial Arbitrage to Save You

Firing people increases EBITDA.
It does nothing to increase capability.

If you want 2026 to look different from 2025, you cannot cut your way to clarity.

You need maturity.
You need a plan.
You need a partner with real experience rebuilding revenue engines.

ROI can help you do that.