Redundancy is an unpleasant but sometimes necessary part of keeping a business viable and profitable. Change Ready CEO Simon Rountree shares his first-hand advice, and mistakes, on managing this thorny process.
Change is a very powerful and important element that allows businesses to prosper. The industries we work in are constantly changing with time, technology, economics, politics, people etc to ensure they can meet the competing demands of the world in which they operate.
These competing demands often require businesses to realign and adjust their strategies to ensure they remain agile, relevant and profitable. To achieve this at times, some businesses need to restructure and downsize, which often results in the loss of jobs and redundancies.
As a CEO, I’ve been in this exact situation where I’ve had to downsize the company, and through this process, I’ve seen a multitude of different reactions: from sadness, shock, anger, bewilderment to a few who have been happy. I’ve witnessed the emotional rollercoaster that comes with hearing this news and have even seen people go from doubt and questioning, to being calm to then being anxious in a very short time.
The impact from a people and productivity perspective is enormous and, if not handled well, can have ongoing ramifications that continue to impact the business and its bottom line.
Through previous roles and my current role, I have learnt that there are many factors at play when facilitating a redundancy, and one of the biggest factors is you. How do you manage yourself, the other people and the situation?
So, learn from my mistakes and successes and follow these do’s and don’ts when it comes to dealing with redundancies within your business:
- Prepare and have a clear process that you follow, and don’t deviate from it! It’s important that everyone is treated the same. Ask for voluntary redundancies and give employees the chance to put forward ways of avoiding job loss.
- Ensure the process operates hand in hand with your business values. Treat people as you would want to be treated: with empathy, dignity, respect and fairness. Ensure that your business values shine, qualify your conduct through this process and continue afterwards to provide ongoing direction and purpose for those remaining.
- Communicate clearly, avoid any spin or ambiguity and acknowledge that this is difficult for them. And while you can’t answer all their concerns, you can provide clarity as to what they can expect like severance pay, notice period etc. Be as open and honest as possible in explaining why this is happening and that it’s a business decision, not a personal rejection. This will help with their grieving process and closure.
- Wherever possible, deliver the news in person. Encourage verbal discussions instead of emails or written correspondence. Letters, emails etc can be sent or presented afterwards to confirm the conversation. Take ownership of the decisions you are delivering and acknowledge the shock or concern that arises.
- Ensure you have support, coaching and/or outplacement services available to those you are transitioning out to reinforce that you care about them and their future. Also, I urge you to offer support to those employees who remain to ensure you can re-engage with them and address their concerns.
- Never turn bad news into good news. Making someone redundant then informing them that the business will benefit from these changes just doesn’t cut it.
- Avoid making assumptions as to how your staff will react. Be prepared for an array of different emotions and reactions. Expect to adjourn meetings and reconvene if employees are too distressed.
- Don’t treat them like a criminal and make them feel like it’s their fault by blocking their email access and demanding they hand back laptops, mobiles etc immediately. Even with business-sensitive information, this situation can be handled professionally.
- Don’t exclude maternity leave employees from the equation. Doing this can make it unfair to those who are not on maternity leave. Or work on a last in, first out criteria, as the redundancy should be about the role, not the person.
- Don’t go down the redundancy path until you have exhausted every other possibility: from taking half pay, leave without pay, natural attrition, changing working hours or methods.
The main point here is that redundancies impact people and that all people have feelings, emotions and needs that require dealing with.
It’s your responsibility to deal with this challenging and difficult situation in a professional and caring manner, and a manner that is aligned to your business values, while never assuming to know how your employees will react, because you don’t. In fact, they don’t know either until it happens.
There are no shortage of do’s and don’ts when it comes to redundancy; however, these tips are essential in allowing you to be mindful that you are dealing with people, not numbers.
Simon Rountree is the founder of change management consultancy Change Ready.