Leading An Organization When You Have To Layoff People

By Jeff Altman, The Big Game Hunter

Leading an organization during times of layoffs can be one of the most challenging and difficult tasks for any senior leader. It requires a delicate balance of empathy, communication, and strategic thinking to navigate the complexities of downsizing while maintaining the morale and productivity of the remaining workforce.

People join organizations believing this company, this organization has their interests in their hearts and minds, too, because, like in dating, there is a seduction to persuade someone to join and stay with the organization. Like with many divorces, layoffs feel like an emotional betrayal.

I have been on the receiving end of countless calls, emails, and texts from people after being laid off. No matter how decently they may have been treated by an employer at the time they were laid off, few heard the corporate message that accompanied their layoff. They think of all the reviews from their manager that praised their performance where they were told they had a future with your company.

Many were brought into conference rooms and auditoriums and told. In the last few years, mass video conference firings became a vogue until the examples of company presidents emoting guilt became the subject of ridicule. Now, we have a new vogue—email firings or just being locked out of systems as a way to let people know their service to a firm were no longer required.

For you as a leader, one of the new things to contend with is that your former employees have a way to easily communicate their very real human stories of being laid off. I suspect most of us have read about the person with 20 years at one firm being let go, the husband and wife, and the woman a few hours after having a baby. They are not “collateral damage.” They are real people whose stories will damage your brand and recruiting efforts for years to come.

What can you do?

When it comes to layoffs, employees want to know the reason behind the decision and the process that was followed. Communicating clearly will help reduce the layoffs’ impact and ensure that employees understand what is happening.

The first step in clear communication is to explain the reason behind the layoffs. This could be due to a reduction in demand for goods and services, changes in the market, or the need to reduce costs. Whatever the reason, it is important to be honest and transparent about it. This will help employees to understand why the layoffs are necessary and why their job is at risk or eliminated.

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This honesty helps to build trust with employees and offers to set the tone for a more positive outcome for your firm. Additionally, being transparent about the company’s future plans helps mitigate the remaining employees’ fear and uncertainty.

At times like these, senior leadership should lead with empathy and compassion when facing the difficult task of laying off employees. This is a critical time for both the employees and the company, and it is important to approach the situation with sensitivity and understanding. By showing empathy and offering support to the employees who are losing their jobs, you can help ease the transition and ensure that the impact is as minimal as possible.

One way to demonstrate empathy is by acknowledging employees’ challenges and offering support to help them through this difficult time. This can include things such as offering the career counseling and resume writing services, providing financial advice and helping to connect them with job opportunities. By providing these resources, you can show the employees that you care about their well-being and are committed to helping them succeed, even after they leave the company.

Do not ignore mental health services for your former employees. A study reported by The Lancet says that across 26 European Union countries, rapid and large increases in unemployment were associated with a significant increase in suicide rates. Imagine the news story in your local newspaper, favorite online publication, or social media site with the headline, “Recently Laid Off (YOUR COMPANY NAME) Employee Dead from Suicide.” Then, shocked, you read the story about this young person leaving behind a wife/husband/partner and three young children. No one should learn to live with that.

It is also critical to focus on maintaining the morale of the remaining employees during layoffs. In times of organizational change, it’s easy for employees to become discouraged and demotivated, which can negatively impact their productivity and overall job satisfaction. To mitigate this, it’s important to have clear and transparent communication about the company’s goals and vision moving forward and to engage the remaining employees in shaping this new direction.

Creating opportunities for employees to build relationships and collaborate can also help foster a sense of community and belonging within the organization. This could include team-building activities, cross-functional projects, and open forums for discussion and feedback. Additionally, recognizing and rewarding the hard work and dedication of employees who are staying with the company during difficult times is a powerful way to boost morale and show appreciation for their contributions.

In short, by focusing on maintaining the morale of the remaining employees and providing them with a sense of purpose, you can ensure that your organization is well-positioned to thrive in the future.

I have seen firsthand the devastating effects of impulsive and poorly executed layoffs. These actions can result in a loss of morale and trust among remaining employees, a negative impact on the company’s reputation, and the potential for legal repercussions. I suspect you have seen that in other organizations, too.

Therefore, it is of the utmost importance for a senior leader to approach layoffs with a clear plan and strategy in place. This plan should be thorough and well thought-out, taking into consideration not just the financial implications, but also the impact on employees, the company culture, and the future success of the organization. Working with your primary consulting firm and accounting firm, as well as other senior leaders with your firm will help avoid blind spots in devising your plans such as race, gender, sexual orientation, and age that can prove damaging after layoffs occur.

In conclusion, leading during times of layoffs requires a delicate balance between being transparent and compassionate, and being firm in making difficult decisions. By effectively communicating the rationale for the layoffs, addressing the concerns of the remaining employees, and engaging them in driving the business forward, the C Suite executive can help to maintain morale and productivity and build a more resilient and motivated workforce.

Ⓒ The Big Game Hunter, Inc., Asheville, NC 2023, 2024 

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