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Downsizing: Blues Or Jazz? Which tune will your employees sing?

When a company decides to down size for economic reasons it is very disruptive to its’ employees. Initially, there’s the worry over who will be laid off. Then there’s the issue of survivors guilt, as remaining employees deal with their feelings, and they probably face an increased workload after the layoffs. All of these factors can lead to decreased productivity, even wiping out the cost saving the layoffs were supposed to produce. Here are four ways to counteract this problem.

1) Ask your employees to help you find ways to cut costs before downsizing.

Be open about your financial situation, and ask for their help. There are modern facilitation methods with a proven track record for helping organizations come up with stunningly creative new ideas. This attempt to prevent layoffs through creative problem solving will be more likely to retain the loyalty of your employees, and may in fact reduce the need for layoffs. To the extent you really do have to cut your payroll, employees are more likely to agree with the necessity of the moves, and to feel less resentful about it. In addition, if your cost cutting efforts are successful and your business takes off again, you may even be able to rehire valued employees down the road.

2) Take care of your employee’s needs during the cost cutting.

Find out what kinds of assistance those being let go need, and see which you can afford. Allowing people some time during work hours to hunt for jobs is one way. Another might be organizing a resume writing workshop, or participating with other employers in organizing a job fair. This will help the morale of all your employees.

3) After the layoffs are complete, hold meetings where remaining employees get to talk about their feelings as survivors. What’s the vision for the future ?

How do they fit into the company’s plans? Where do we go from here? You need these employees to make your business work in the future. Treat them like the valuable team members they are, and they will reward you with their loyalty.

4) Make conscious choices about how you restructure after the layoffs.

Giving people new responsibilities because you know they can do it can lead to burn out. You need your employees to respond with energy and enthusiasm. This is best accomplished when people’s roles and responsibilities are aligned with their core values. You can attempt to do this yourself using individual interviews and facilitated discussions, however this is time consuming and you have to understand what core values matter in people’s careers.. Another option is to make use of the NetTPS™ talent management tools. They are designed to uncover employee’s core values and relate them to the needs of the role they are being asked to take on; not the tasks themselves, but how the tasks are accomplished. Based on fifteen years of experience, these tools can help you make the transition go more smoothly, and can be used proactively to increase employee creativity and retention.

Layoffs are disruptive. If you really want to make them work for your business it’s important to tend to the needs of all your employees, those being laid off, and those remaining. It also matters if you make conscious choices about job restructuring and give employees responsibilities that are in line with their core values.


Sterling Newberry

Sterling Newberry is a Certified Professional Facilitator by the International Association of Facilitators, and has a BA in Sociology from Dickinson College, and a Graduate Certificate in Conflict Resolution from John F. Kennedy University. He believes that organizations are living organisms, that each person plays a vital role in the… MORE >

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