Mergers, acquisitions, market downturns and financial constraints are just a few reasons why companies find themselves having to downsize their workforce. But how do you downsize the right way? Most companies are aware of the ‘legal requirements’ for disengagement but getting it right goes beyond the legalese. There are 4 critical steps a company should take to maintain its reputation and keep the morale of remaining employees from being negatively impacted during a work force reduction (WFR).
1. Develop a well thought out transition plan
Each piece of the transition process needs to be though out beforehand. Company goals and objectives as well as a detailed process of what employees (departing and remaining) can expect needs to be part of the transition plan. Analyze your talent pool and identify the key skills the company will need after the layoffs. You will be better prepared to offer transitions to other roles for those employees impacted. The higher ranked individuals should be considered your talent pool for potential retraining and redeployment. Provide access to tools and personnel through the exit process. Making personnel and tools available to help those impacted will help reduce everyone’s stress during the transition.
2. Work closely with personnel and Human Resources department
While this may seem obvious, it is surprising how often the Human Resources department is not leading the tactical parts of a transition. HR professionals know all the rules on communicating company changes, good or bad. They will help develop communication strategies and oversee the entire work force reduction process. From putting together severance packages to defining health benefits to transferring of retirement assets, HR professionals are your best friends. Review alternatives with HR prior to announcing layoffs.
- Provide early retirement options if it exists today. Employees are more willing to take early retirement if offered a retirement package. Work with Human Resources on best options for your company. Be aware that you may lose some top talent here, be prepared if that occurs. You can always extend a contract for a period of time for those whose roles are essential to the company’s success while extending the retirement package to a later date.
- Ask for voluntary layoffs. You’ll be surprised how many individuals may volunteer. Again, be prepared to potentially lose some top talent here as well.
3. Open and clear communications
Open and clear communications is a critical part of moving forward which is often underestimated. All employees need to be told the rationale behind the layoffs. This needs to be communicated in a humane manner. Focus on what the company is doing to ensure a successful transition, don’t just focus on the numbers. The manner in which departing employees are informed will reflect on the morale of all employees. Make sure those tasked with the actual layoff notification are well trained on delivering the message in a professional but sympathetic manner. Providing timely communication in various forms will also go a long way in successfully transitioning employees.
- Set up a website employees can easily access for up to date information. Frequently asked questions (Q&A), milestone dates and contact information are just a few of the documents the web site should provide. However, websites and electronic communications should not be considered a replacement for ‘live’ updates. It is essential that employees have access to those responsible for the transition either on a one-to- one basis or as a larger group, either via phone, video conference or in person.
- Communicating a strategy for realigning the remaining work force is critical in employee retention. Develop a retention strategy for the remaining employees. This could be in the form of retention packages for those employees whose role is vital to the success of the company. This will boost morale and alleviate concerns of future layoffs.
4. Outplacement (transition) services
Outplacement services will help alleviate the stress and frustration of your displaced employees while aiding in their transition to new employment. It will also send a clear signal to all employees that your company takes care of its people, even when difficult decisions need to be made. This will in turn help maintain the company’s reputation, boost morale and better position you for a future workforce expansion.
At RAI Resources we deliver outplacement services to local companies at affordable prices. Our services are tailored to meet our client’s specifications. Contact us to receive a FREE REVIEW of your company’s situation and learn how RAI can help.
2. Communication Strategy
3. Career Research
4. Job Search Tools
5. Resume Preparation
6. Managing the transition
7. Interview prep and negotiations
8. Value proposition creation
9. LinkedIn profile