The Real Challenge Comes After The Layoffs

You never considered that you’d be in the position to have to lay off employees.  With rare exception, your employees have been loyal and hardworking.  Some of them have been with you so long, you can’t recall when they weren’t there.  And now…now you have no choice.  You have to lay off some of them.  And, you know, that the words “lay off” are not really the right words, because you know that…they won’t be back.

You blame yourself for letting things get to this point.  “I should have fixed our problems when they first appeared,” you say.  That, coupled with this economic perfect storm, and there are no alternatives other than closing up altogether.  If the company is going to survive at all, you have to do this.  You’ve put names on a list and you’ve looked at that list a hundred times trying to find another way.  Now it’s time.  You’ve decided to have an all-employee meeting first to announce the layoffs and then meet with the affected employees.  You don’t know if that’s the right order for these steps, but it makes sense to you.

After the all-employee announcement, you meet with the affected employees one at a time.  You could have assigned this dreadful task to your supervisors, but you knew that wasn’t the right thing to do.  As you meet with each employee you are struck by the differences in their reactions.  Some are numb and in shock.  Some are angry.  One comes close to attacking you.  Some fight back tears.  Others cry.  One sobs.  And, shockingly, two of them apologize to you because they feel bad that you have to do this. 

It’s done.  Now what?  You haven’t given much thought to what to do after the layoffs because your entire focus has been on that dreadful day.  Now what?

After the layoffs the mood has changed significantly, but you find it difficult to describe.  You realize that some employees avoid eye contact with you hoping you won’t call them into your office next.  Others are still in shock.  A few more are angry.  All of them have unanswered questions.  “Wait a minute, that’s it!,” you exclaim.  They have unanswered questions and now you know what to do.  So you make a plan.  It’s called BLACX3 (pronounced Black X 3)

• First you realize that you need to help your remaining employees see the (B) big picture.  You talk about why the layoffs were necessary from a business and financial point of view.  You also help the remaining employees grieve losing their co-workers and friends.  You help them see the big picture.
• Second, by observing your employees you suddenly realize that they are…(L) lost.  They have lost their way because their predictable, stable world has been wrecked by a tornado.  Some of them also feel guilty for keeping their jobs.  The key is to focus them on what to do now.  They know all the things that need to be done, but they are lost and they don’t know what to do now.  Give them direction and guidance and help them find their way back.
• Next, help employees (A) adapt.  Help employees deal with all the changes.  Not only the changes made by laying off employees, but all the changes caused by the layoffs that are now rippling through the organization.  Procedures and processes are being changed because some of the people in the procedures and processes are gone.  Change is everywhere and it feels like a different rollercoaster ride every day.  Help them adapt by working side by side with them to make the changes that are necessary.
• Finally, CX3.  Communicate, Communicate and Communicate.  Employees will go through a predictable series of steps as they restore themselves to full productivity.  The key is to listen to the questions that are nagging at them.  Help them ask those questions and work to answer those questions one at a time.  When they finally accept your answer to that question, they’ll move on to other questions.  Be patient and stick with them, one step at a time. 

What you are dealing with is the predictable human psychology process of adapting to change.  If you, one day, in your frustration, snap at the 12th question on the same topic and yell, “Shut up and go back to work,” restoring the productivity of that employee will be almost impossible.  Your employee may become frozen and stuck in the change process.

The hope is that all employees will move through the change process and be restored to full productivity.  Honestly, it’s likely that not all of them will make it.  As time consuming and “touchy-feely” as this process sounds, it’s your best route to restoring the company’s financial performance. 

As incomprehensible as it may seem to think about layoffs and cut backs, don’t forget to give thought and preparation to the real challenges that lie ahead after the layoffs.  The future of your company depends on it.

Use the Recession to Improve Your Business Results

Use our current economic downturn to challenge the “It Can’t Be Dones.”  Based on the last sentence, I’ll bet you already have a picture in your mind of one of your employees who frequently says that it can’t be done.  The “It Can’t Be Dones” are the unwritten “rules” that drive your organization.  It takes five days to ship an order.  We’re not set up to do big jobs.  We have to follow the ten step project management process.  Our management meeting is always four hours.  That machine can’t be operated by less than three people.

Now is the time.  Go challenge every “It Can’t Be Done” and every unwritten rule that operates in your organization without your permission.  Use the economy as an excuse to improve productivity.

Delivering Results In Spite Of The Recession

The National Association for Business Economics (NABE) just released survey results that indicate what many of us seem to know, but haven’t said out loud; the economy is getting worse and won’t recover quickly.  According to their survey, completed November 7, the U.S. economy is contracting at a 2.6% annual rate in the 4th quarter of 2008 and will fall at a 1.3% pace in the 1st quarter of 2009. 

These results are a big change from the survey conducted in September, which forecasted slow growth for the same periods.  These are the experts and even they don’t know where the bottom is. 

How bad will it get?  Chris Varvares, NABE president said “There has been this perfect storm that has slammed the consumer sector.”  Not since the Great Depression have we encountered a housing bubble collapse, a credit crisis, skyrocketing energy costs, a plummeting stock market, a recession and increasing unemployment all at the same time.

So, if this new forecast is accurate, how are you preparing your organization for the recession?  Here are four steps that business leaders should take to weather this perfect storm:

First, cut 20%.  This is both a financial step and a mental exercise.  Let me explain. 

Financially, ensure that your company can weather the storm by increasing cash reserves and cutting expenses significantly.  If the economists can’t predict where the bottom is, we all have to be prepared to survive this recession. 

As a mental exercise, decide what you would actually cut if you had to reduce your budget 20%.  The value in the exercise is that it forces you to prioritize what you would keep and what you would cut.  It helps you narrow your focus and put your efforts into those activities that provide the best return.  So, this chapter of economic turmoil may actually help you improve your organizational performance and financial results.

Second, challenge the “It Can’t Be Dones.”  You already have a picture in your mind of one of your employees who frequently says that it can’t be done.  But, I’m also talking about the unwritten “rules” that drive your organization.  It takes five days to ship an order.  We’re not set up to do big jobs.  We have to follow the ten step project management process.  Our management team always meets for four hours.  That machine can’t be operated by less than three people.

This economic downturn is a perfect excuse.  Cancel your four-hour management team meeting and have your managers go challenge every “It Can’t Be Done” and every unwritten rule that operates in your organization without your permission.  If your managers have the “It Can’t Be Done” disease, start with them.  Use the economy as an excuse to improve productivity.

As you face the “It Can’t Be Dones,” you are also thinking of that employee whose issues go beyond “It Can’t Be Done.”   Everyone else has to work around them and their issues.  Others handle issues so that he doesn’t have to get involved.  You’ve moved her so that she has less customer contact.  He says he’ll get the job done, but he doesn’t.  As people come in they walk on eggshells to see if Dr. Jekyll or Mr. Hyde showed up today. 

This leads us to step three.  Work up the courage to have the conversation that should have taken place months ago. It may be messy.  It may be disruptive.   But, it will be less disruptive and less costly than to let it go on.  Besides, you’re losing credibility with your employees by letting it go on and on.  They’re more annoyed at you than at the problem employee.  Call your employment attorney or another trusted advisor and talk through how to address the issue at hand.  You and your employees will be more productive and you’ll enjoy coming to work again.

Finally, increase your marketing.  Yes, I did say to cut your expenses, but I didn’t say cut your marketing expenses.  In an economic recession, the pie gets smaller.  You have a decision to make.  Accept a smaller slice of a smaller pie…or, use this time to get stronger while your competitors get weaker.  Increase your marketing efforts and sell the benefits of your products or services like never before.  Reach out to old customers you haven’t done business with in a while.  Enter a related market niche in order to get a slice of more than one pie.  Advertise to your existing customers.  You’ll be amazed to find out how many existing customers don’t know what else you sell.

By all accounts, we are in a recession.  Will you be a victim of the recession or will you be victorious over it?