FORBES
How To Lead Through A Reduction In Force
“It’s a big company. You’re just a number here. They don’t care. Why should I work hard for this company?”
Management’s response matters
However justifiable (or not) reasons for layoffs might be, the news creates instant anxiety for the employees who might end up on the chopping block as well as for those who will remain. The approach that management applies as it moves through difficult times like these matters. Employees will become increasingly doubtful and anxious as they watch their colleagues become unemployed and wonder whether they will be next to receive a layoff notice.
It is incumbent upon managers to do things to alleviate – as opposed to increase – anxiety.
Layoffs happen and should even be expected from time to time. But managers unnecessarily exacerbate the challenges for those impacted by withholding information, providing misinformation, being overly opaque, failing to plan for and manage a consistent process and by overlooking the importance of addressing human dynamics. In contrast, the best managers and most effective leaders will do things like this:
- Give as much notice of pending layoffs as possible. A lack of notice creates real resentment from those being laid off and dramatically increases mistrust of management among remaining staff (also known as survivors). ❌ (Fail)
- Address the feelings that both the laid off and remaining employees will experience. Show empathy and validate emotions. ❌ (Fail)
- Preserve the institutional knowledge and intellectual capital. Be certain to keep enough of the best people on board to accomplish organizational goals and/or have knowledge shared with others. ❓(Unclear at this time)
- Base layoff decisions on sound business analysis and data intelligence rather than making arbitrary, across-the-board cuts. Avoid making hiring/firing decisions based on personal relationships and biases. ❓(Unclear on lay-off decisions) ❌ (Fail on hiring decisions)
- Be transparent and communicate openly and often. In the absence of information, employees will simply fill in their fears and anxieties with information, usually negative, about management and the company. ❌(Fail)
- Reassure remaining employees of their value to the organization and how they can contribute to building a brighter future.❌(Fail)
- Ineffective implementation of a reduction-in-force plan could lead to unintentionally losing excessive talent and institutional knowledge. Make an investment in those left behind. It is typical for many people to ‘jump ship’ during uncertain times so be sure to invest proper time, resources and emotional fortitude.❌ (Fail)
- Have a clear vision and plan for operating post layoff. Will the ‘new’ organization or department be in a position to deliver the services and/or products you require? Consider operational capacity in your lay off decisions. What kind of new stresses will remaining employees experience? Have a plan to mitigate this.❓(Who knows? But definitely a Fail on communication of said strategy)
- Exhibit compassionate and strong leadership.❌ (Fail)
- Be prepared for and address the myriad of emotions that you are likely to observe. In addition to the financial insecurity that can be created, the loss of a job can affect other areas from confidence to self-worth. Expect feelings that span the range of confusion and despair to anger and a lack of trust. This may be one of the most stressful times for all parties involved. Try to empathize and be understanding as you manage this process.❌ (Fail)
- Focus on the employees who will remain as well as those being terminated. It is equally important that leaders recognize and address the mixed emotions of those employees who remain. There is a high likelihood that productivity, morale and commitment will decrease as a result of anxiety, instability and a perceived breach of trust. While implementing plans for the employees who will be leaving, don’t forget to rebuild trust and develop morale with those who remain.❌ (Fail)
- Be as transparent and forthcoming with information as you can. As stated earlier, in the absence of regular, open communication, people will seek to fill in the blanks with unconfirmed – often untrue – information. Be sure to serve as a valid and dependable source of information and resist the temptation to appear secretive, inaccessible, or withdrawn. ❌ (Fail)
- Provide as many resources as you can. Help employees believe that you ‘have their backs.’ Even when their jobs are being eliminated, employees can feel a sense of dignity and respect when the process is deemed supportive and fair. Make it a goal to provide real meaningful resources to help them move forward. ❌ (Fail)
- Balance empathy and understanding with company loyalty. Be a leader among leaders by advocating that all the recommendations listed here get considered. It’s a delicate balance, but one you will need to master. ❌ (Fail)
- Be smart about the restructuring and realignment process. Really look at the remaining talent pool along with the organizational programs, products, and services and make sound restructuring and placement decisions. As best as you can, match people with the right positions based on interests, talents and skill sets. How you go about doing this will send powerful messages about your commitment to the remaining employees and, if done well, will go a long way to rebuilding trust and organizational commitment. ❓(Who knows? Communication of strategy would be nice,)
To be fair: I give Charlie a 🥳 (Exceeds expectations) for most of the WFH strategy. He and the team pulled it off in a reasonable time frame.
Overall, though, Charlie is rated:
Below Expectations* in his Leadership of Wells Fargo through Lay-offs.