What’s even harder than laying people off?
Making sure that the survivors don’t start fending for themselves instead of your business.
Managed incorrectly, layoffs can lead to:
- Loss of Star Performers. They’re the most likely to have other offers and most likely to be disillusioned by the betrayal of layoffs.
- Destroyed Morale. Remaining employees lose trust in and commitment to the organization.
- Unrecoverable Penalty Costs. This may cost you more than what you save through layoffs. Decreased productivity, costly mistakes, attrition, outright sabotage, and failure to operate in the best interests of the organization can easily negate the savings of layoffs.
- Vanished Productivity. As the survivors deal with their emotions and struggle to cover vacant positions, up to 80% will simply “check out”.
- Ruined Corporate Reputation. How your former and current employees speak about you can do grave damage to your standing. When things turn around, the most desirable candidates will shun you. This is especially true of the highly mobile under-40 segment.
Imagine you are rafting down a gentle river (a healthy and predictable business environment). Even though you may be paddling like mad to stay ahead of the competition, the direction is clear and nobody is falling overboard.
Then you turn a corner… and you see outrageous whitewater ahead (a turbulent, declining, unpredictable business environment)
You’ve suddenly lost several members of your team (layoffs) and everyone is in a panic trying to save themselves.
You’re now managing a bunch of survivors, the lucky ones that didn’t get swept away in the layoffs.
How do you get the survivors back in the raft and making progress?
You’ll be half way there if you avoid these common mistakes:
1. Failing to Communicate Enough
When layoffs occur, normal communication pathways are disrupted at the same time as suspicion and mistrust are on the rise. To make matters worse, many managers communicate even less than normal because of the uncomfortable nature of the situation. When employees don’t receive any news, they assume the worst. They assume that the news must be so bad that nobody wants to tell them.
Solution
Over-communicate everything. Give them as much detail as possible. Even if it is the same old news. Try to get a senior manager or human resources director to speak to your staff about future plans of the organization. Even if the news is bad, it is better than rumors. And employees will appreciate receiving credible information. Trust will build.
2. Surprising your staff with the layoffs
In a misguided attempt to avert sabotage and reduce pre-layoff problems, many companies wait until the last minute to announce layoffs. This dramatically reduces the surviving workers’ trust of management. When the first person is let go and employees discover what has been brewing without their knowledge or input, they see a blatant disrespect for their integrity and trust. By not keeping employees in the loop and providing information that would be a great help to them in planning their own lives, management starts a cycle of mistrust and helplessness that can be very destructive and require years to correct.
Solution
As a manager you will have to live with the corporate policies around layoffs. You can, however, let the people up the management chain know how difficult it makes it for you to keep your team motivated. Maybe the next time they’ll reconsider the process. In the meantime, make sure your team knows you’re on their side. Follow the recommendations at the end of this piece.
3. Withholding information
This is the nefarious cousin of failing to communicate enough. The methods often used in badly executed layoffs treat employees like children. Information is intentionally withheld and doled out. Human resource reps sneak from one hush-hush meeting to another as an axe drops with each visit. You can be sure that the employees who remain are watching this closely and will react accordingly.
Solution
Be transparent. If your senior leadership is not forthcoming, do as much as you can to share whatever you know with your team. Make it obvious that you are doing your best for them. Try to avoid getting yourself into a situation where you have “insider info” which you are not allowed to pass on to your team. If the team finds out you knew something and didn’t pass it on, you’ll have a difficult time in re-establishing trust. If you are lucky enough to be in an organization that allows you to be transparent with your staff, make sure that you communicate everything and do it repeatedly.
4. Treating laid-off people Poorly
After the HR reps drop the axe, laid off people are escorted out as if they were criminals, clutching a cardboard box of personal effects. A marginally better approach allows them to collect their stuff after-hours. Your outplacement and post-layoff support services and severance packages say a lot about your company. If they are inadequate and reek of cost cutting, be prepared for the fallout.
Even if your approach is not this bad, everyone is watching. How laid-off employees are treated is how surviving employees assume they may be treated. And laid-off employees will spread their disappointment and bad feelings about the company. In the battle for talent, a company’s reputation is gold. This causes grievous harm to that reputation and will make recovery even harder.
Solution
As a middle-manager, you may not be able to do much. These procedural decisions are usually made at the executive/HR/legal level. However, anything you can do to reassure the team that you’ve “got their backs” will make it easier to recover after the layoffs.
5. Assuming Everything’s OK
Many managers trust their normal observations of their team’s internal dynamics, even after layoffs. What they fail to recognize is that there is a lot of communication happening to which they are no longer privy. The loss off trust resulting from layoffs will cause employees to exclude you from their conversations as the rumor mill goes into overtime. On the surface, it may seem that everything is OK. Underneath, the team could be self-destructing.
Solution
Don’t Guess. Management by facts is the best way to understand how employees are truly performing after layoffs. Regular, systematic attitude and engagement assessments will help you gauge what is really going on. This will also demonstrate to employees that their input is valuable and that they are still important to the company.
6. Forgetting to nurture your stars so they don’t leave.
After layoffs, your best people are your greatest flight risk. You may have carefully spared your top performers from the layoffs, but find that they are jumping ship anyway. Even if the layoffs were not performed poorly, your top talent will already be looking for other options to avoid the same fate themselves. Being that they are most likely to find other employment, they may soon be gone.
Solution
Spend extra time with your stars to provide reassurance, support and encouragement. Help them see that downsizing opens new opportunities for advancement and promotion.
7. Expecting Team members to step up and cover for lost people
You may wish to simply redistribute the workload and push forward so that you do not lose momentum. That would be a mistake. Many layoff survivors feel like victims. Higher work load, new responsibilities for which they feel unqualified, unfamiliar new work and reporting relationships and more will all contribute to the malaise. Some may find this challenge exciting and career expanding. The majority will find it intimidating and stressful. Productivity will plummet as team members flounder.
Solution
Facilitate a session where the team helps decide how work gets redistributed. This will help them regain a sense of control and ownership. You may be surprised by how people rise to the occasion. It is also essential to reinforce mutual support so that team members know they’re not in this alone and can rely on their colleagues for help.
8. Discounting the effect of “Survivor Guilt” and other emotions
Layoffs cut to the very core of employees’ sense of security, safety and their position in the world. Many will have never considered what they would do after losing their jobs. To make matters worse, in a down economy, chances of finding employment are low unless one is a top performer. Those that remain will be traumatized both by the layoffs as well as guilt of having kept their jobs while others were shown the door.
Pretending nothing happened for fear of dredging up negative feelings actually makes it worse. Whether you see it or not, your team will be talking about it and the more you try to suppress or ignore these conversations, the more subversive and toxic they become. If you won’t talk about it they will wonder what else you’re hiding. If you don’t acknowledge what has taken place, it will seem particularly heartless and worsen employees’ sense of helplessness.
Over time, employees build up a “psychological contract” with the company. It involves a level of trust, respect and commitment and is the foundation of their employment relationship. Layoffs can violate this contract and create intense feelings of being wronged. This leads to team dysfunction, attrition and even sabotage as remain team members lose their loyalty and turn vindictive.
Solution
Take the emotional fallout seriously. Take the time to talk about this with your team, both individually and as a group. Acknowledge the loss and allow time for grieving. Don’t flinch in the face of the intense feelings of your employees. As uncomfortable as it may be, wade into the emotional fray and do whatever you can to help your people through it. This can be made even more difficult if you are dealing with the same feelings yourself. There is no formula for this and outcomes are not guaranteed. But you’ll likely get a much better result by dealing with it rather than ignoring it
Conclusion
Layoffs are one of the most traumatic events people can experience in their work lives. It can be just as bad for the survivors as those laid off. Dealing with the trauma poorly can lead to disastrous consequences for individuals, teams and the corporation as a whole. Doing it right requires courage, vulnerability and commitment and leads to not only recovery, but often a whole new level of team excellence. It can be tough at times, but worth it! We can make it easier, create better outcomes, and help protect your business as you come through the other side.
How to Quickly Get Your Team Back on Track
A Post-Layoff Recovery Process
One of the most effective solutions to post-layoff team trauma is our “Recover, Rebuild, Refocus” process. This is a process that we facilitate that guides you and your team through the tricky waters of team recovery after layoffs. It begins by working on the emotional fallout of the layoffs, helping your team deal with the feelings, mistrust and uncertainty of the situation. This is the Recovery phase. Next, your team takes stock of where it is now and how you will deal with the current reality. This is the Rebuild phase. Finally, the team creates a new focus with tangible, compelling goals around which the team can rally. This is the Refocus phase.
We make this happen through a combination of team and individual processes conducted by an expert facilitator with a long track record of success.
We’d be happy to discuss how this can work for you!
Experienca
is an outstanding cadre of leadership and team development specialists ready to bring your organization to the next level of teamwork, results and happiness. We’ll get you there with programs ranging from team fun and bonding events to in-depth transformative retreats and longer term coaching and consulting. Our clients love us and so will you!
Contact us today so we can make a difference in your life and your team.
+1 (403) 270-0000 infonow@experienca.com
My name is Trent Schumann and I’m the founder and lead facilitator of Experienca. I hope I have the pleasure of working with you soon.
If you found this post interesting…
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Thanks for an insightful post in an otherwise gloomy outlook
You’re welcome Steve!