They know exactly what they are doing. They are "knifing the baby". Some employees will suffer, but it is for the greater good. If the company fails (look at Nortel), then everyone suffers.
Let's say you are reading a historical account of a woman knifing her baby to save something else of value. As you are reading, you come to realize that the mother was panicked and not thinking clearly, because you realize there was another way.
I've read the same script before. The way this move was presented to the employees had bad results. I doubt the bad parts were really necessary.
It's a complicated situation. I doubt there was a binary choice whether or not to knife the baby.
