Even though, we’re seeing early signs of economic recovery, some organizations continue to “right size.”
One such organization systematically planned, over the past few months, to reduce their number of employees by 30%. In the organization’s history, this was the first time staffing levels had ever needed to be reduced. Three senior managers (CEO, COO and HR Director) looked at all aspects of the pending actions and carefully weighed their decisions from a business perspective. Departments were merged, eliminated and restructured. Employee’s names were on the list, off the list, reassigned and, in many cases, back on the list again as positions were considered for elimination.
Initially, I wasn’t completely in agreement with the decision to have this event known only to those three. I felt input from the front-line managers would provide significant value. As the process evolved, however, I discovered how the business units were immensely interrelated. If managers had been given a voice, the organization would have imploded due to each manager’s differing opinions of “high performer.” In the end, it didn’t matter.
This organization chose to look first at their business needs. Which departments were critical to the business function? How many and which positions were required to meet the client needs? Once those elements were established, they staffed those necessary positions with the employees with the requisite skills who had been with the organization the longest. They did not consider performance. If there were two employees occupying the same role and only one was needed, the one who had been with the organization the shortest amount of time was laid off—even if there were noteworthy performance differences.
Entire departments were eliminated and some employees who had been with the organization for over 15 years found themselves without a job. It was tough. But, it was fair. At a single meeting, departmental managers were informed of the process, the conclusions, their duty to execute the decisions and their role going forward. These managers may have been surprised by the news and may have felt out of the loop, but the process was clean and driven by data, rather than emotion. It was easily defended.
Even though termination conversations are never easy, the individual discussions with the affected employees were straightforward. The decision was simply based on business need and the date of hire—nothing more. Those leaving were treated with respect. They had no reason to feel ashamed. They had done nothing wrong. To ease the burden of losing their jobs, the organization presented each departing employee with a reasonable separation package. They also had computer stations set up and staffed with human resources professionals to assist the employees in completing an on-line application for unemployment compensation benefits.
All in all, well done.