While staffing cuts are typically made with the intention of strengthening an organisation’s future, how the process is managed will impact the extent to which benefits are realised.
Lost productivity, diminished quality of products and services, and inflated employment costs due to staff turnover are just some of the challenges organisations face when downsizing isn’t managed well.
While there is nothing anyone can do to avoid altogether the pain inherent in downsizing, a planned and compassionate approach will go some way to minimising adverse impacts to people and ensuring the organisation’s spirit and capabilities are protected for the future.
For any team to move forward to a better and brighter future, trust in and respect for the organisation’s leadership team is essential. This approach to leading change will have a powerful impact on trust and respect.
Lay foundations of trust
Minimizing the impacts of downsizing should begin long before it becomes necessary to make redundancy decisions.
Making substantial changes to your workforce while maintaining engagement from the rest of your team is only possible when people trust and feel loyalty toward the organisation.
Trust is at the core of any strong relationship. Nothing has as great an influence on the success of a team, especially when faced with difficult circumstances.
When times are tough people who trust their manager and leadership team are more likely to accept decisions made to protect the viability of the business.
When trust in the character and competence of leaders is low, resistance and conflicts typically escalate. Without trust a leader will struggle to inspire people to strive at the best of times, let alone when they are facing a future of uncertainty or little hope of success.
At times, it is challenging to forecast conditions and circumstances that will lead to downsizing. However adopting a planned and considered approach to running your business will go some way to ensuring you see challenges coming before they arrive.
Forecasting what is likely puts you in the driver’s seat, enabling you to be ready for and proactively manage change.
A structured and disciplined approach to change planning and implementation is key to ensuring people are treated with the fairness and respect they deserve.
Think about what the future looks like before deciding to expand your team or hire new people. Maintain an optimal level of resourcing in your business by questioning the need for every role as the need to recruit for them arises.
Before going to market to fill a vacancy, consider the likelihood the business will require that position in the foreseeable future.
Do what’s needed – no more and no less. Think very carefully about the extent of the job cuts you make. Consider the immediate future and the roles and capacity the organisation will need to drive forward post implementation of redundancies.
While a harsh and deep cut of your resources may achieve short-term financial objectives, capabilities and energy are essential to achieving the turnaround or improvement objectives of your business.
Be respectful, fair and compassionate
People impacted by downsizing typically want to know that every decision reached was made with fair and reasonable consideration given to all of your options and the consequences.
It’s essential that you demonstrate you care and are doing everything you can to avoid unnecessary impacts to staff and their families. Help people to feel personally valued and that the loss of their job is sincerely regrettable.
Behaving with respect, fairness and compassion is likely to serve you well and earn the respect of most reasonable people. Focus on each person and strive to understand their circumstances and how they will be impacted by change.
Appreciate who people are and how their lives are impacted by your decisions. Never step back from the decisions you need to make, but get the insights you need to minimise any adverse impact on people.
Being authentic and honestly sharing insight are important elements of treating people fairly. Give your team the opportunity to understand reality while protecting commercially sensitive information.
Reasonable people understand there are some things you can’t say and will trust you to be the judge of what you can and can’t. Every manager should be coached to communicate decisions clearly, provide facts accurately and deliver news with sensitivity.
Often when people complain about being lied to and misled, the issue is the approach taken, not the intentions of their employer.
Where there is a void of information people will typically make assumptions and draw their own conclusions. Proactively manage the awareness and perceptions of your team. Be up front with people about how and when redundancy decisions will be made.
Maintain communication with the team well beyond the last day employees made redundant left the business. After job cuts have been implemented people often spend a lot of time talking about what has happened and worrying about what might happen in the future.
Keep communicating with your team about why you have confidence in the future and the role you need them to play to make it happen.
If the truth is that further redundancies are likely, help the team to understand what needs to change to avoid those circumstances.
Irrespective of how hard the fight might be to avoid that reality, you are better off focusing your team on what they can do rather than simply leaving them to wallow in the miserable reality that further job losses are looming.
Look out for everyone involved
Never underestimate how stressful downsizing can be for everyone involved. It’s logical to assume that the people faced with the possibility or reality of losing their job may be stressed. Some organisations, however, underestimate the stress felt by HR staff and leaders driving change.
These people often find themselves having to work long hours, many of which are spent engaged in emotionally-charged conversations, making decisions with life-changing consequences for people they know and in many instances like.
Check in with these people and encourage them to seek the support they may need. While Managers and HR people need to avoid getting caught up in emotions that undermine their ability to drive the process with objectivity and professionalism, that can be easier said than done.
Understand that while maintaining high standards of conduct is essential, at times people immersed in the process of downsizing will struggle to have the strength they need to maintain composure and resilience.
Karen Gately is a leadership and people-management specialist and a founder of Ryan Gately, a specialist HR consultancy practice. She is also the author of The People Manager’s Toolkit: A Practical guide to getting the best from people and The Corporate Dojo: Driving extraordinary results through spirited people.
Large-scale job losses continue to feature frequently in our news headlines. Tough economic conditions, rapidly changing industries and competitive markets are commonly reported reasons for corporate downsizing.