Projections Inc

Employee Communication Resources

Articles

Positive Downsizing - It Can be Done

Downsizing - the very word makes many fearful, especially in today's economy and with so many people out of work. But for many companies, it's the only way to survive, and it's necessary to continue employing even a percentage of their workforce. The question is, can it be done well? Is it being done for the right reasons, the reasons that make sense even to those who are being let go?

"10 years ago, people didn't really know this information," says Human Resources Consultant Jim Gray. "When people approach methodologies on downsizing, there is a temptation for leaders to say, ‘just do it and get it over with,' but giving in to those temptations just don't work. There is a business transitioning process involved with positive downsizing, that should be managed as a project."

The following checklist, based on Jim's advice, will assist any company facing a layoff or similar situation. If you are Human Resources representative, this list may even help you come to terms with the right thing to do and the right ways to do it.

Questions to ask for a successful business phase-down:

  • Are key business drivers such as safety, productivity, quality, and delivery going to be maintained?
  • What are you doing to comfort the survivors? (The employees who you hold on to)
  • Are you communicating with customer, suppliers and the community about what is going on?
  • How are you going to be perceived in the human decency quotient?

Questions to ask on rationale for proceeding with layoffs:

  • Are you being 100% truthful in making the business case for downsizing? Do you have a true business rational?
  • Are you trying to ‘soften' the reasoning? (If so, do not)
  • Are there other alternatives you can opt-for? (Such as asking for volunteers before making the terminations, seeing if there is placement available at other company locations, looking into flex schedules or a reduced workweek)

Questions to ask when preparing the management team:

  • Have you assigned project planning exercises?
  • Are you prepared to deal with anticipated reactions and responses? (Most likely emotional, negative, and angry). This applies to both survivors and the victims (Those who are laid-off).
  • Is a worst case scenario reaction plan developed?
  • Do you have security/ business interruption contingencies?

Questions to ask regarding payout options:

  • How will the severance package be structured? What will the payout be?
  • Should we offer stay-on bonuses to survivors?
  • Have you handled all responsibilities regarding employee benefits?

Have you reached out to external sources for support services? This includes:

  • Outplacement firms
  • Employee Assistances Program (EAP)
  • Government or not-for-profit agencies
  • Financial advisors
  • Professional associations and volunteer groups

How are you planning on communicating with employees?

  • Communication announcement should consist of 3 to 5 main bullet points
  • Explain that it is not the employee's fault; they are not to blame
  • Let employee's know the situation behind the decision (i.e., the economy)
  • Be empathetic
  • Consider an alternative medium such as video production
  • Continue to update employees with on-going communications (if they are maintaining their job for a set period of time)

What do you do after communicating with employees?

  • Offer victims advice (or a script) on how to explain the situation friends and family
  • Help spouse and children cope with situation (i.e., remember the EAP)
  • Post generic resumes in places like town newspaper
  • Contact government officials notifying them of the layoffs and the victims
  • Consider an on-site job fair
  • Encourage celebrations of milestones (have the victims found new jobs?)

For over 30 years, Projections has helped employers communicate with their workforce. When John Deere's Commercial and Consumer products division was faced with a layoff, Projections assisted their Human Resources team with a powerful video presentation. Deere's HR Representative had this to say about the results of that communication:

"The video that you developed for John Deere Consumer Products to announce and explain the movement of our assembly operations to Mexico was magnificent. Not only did it achieve the employee understanding we were looking for, I feel it was responsible for the following:

  • Deere Corporate Office did not receive one phone call from anyone on the subject, press or employee.
  • Both the state of North Carolina and South Carolina agencies that work with companies on this type situation said we should be used as a model for other companies.
  • Employees whose jobs were being phased out volunteered to help with the Mexico start-up.
  • To date, we have not lost many of our employees since the announcement, which was the other objective that we had. We appreciate the immediate response and excellent cooperation we received from you on this project."

For the full case study, visit the Projections website: http://www.projectionsinc.com/positive_rel_workplace_lay.html

This article on downsizing is also part of a larger presentation that Jim Gray hosted for Projections, available on Projections' Insider Network. To access it and many other expert seminars, please visit www.ProjectionsInc.com/portal to login.

arrow back BACK TO ARTICLES ARCHIVE