Low unemployment rates and a scramble to close the skills gap are top-of-mind trends among HR professionals and business leaders. Against such a backdrop, thoughts of reductions in force (RIF) and layoffs are largely ignored. True…in September, there was a brief threat of a federal government shutdown. But that was quickly resolved before it ever took shape. So, we’re all safe and secure in our jobs for the foreseeable future, right?
Not so fast! A scan of recent news headlines revealed layoff announcements at Lenovo, Intel, athenahealth, SeaWorld, Snap, Time Inc., Blue Apron, and Tesla. Yikes! Somehow, quietly, these and many other companies across a wide variety of industries are laying off employees as they react to their own market conditions and business realities. And…as we approach the end of the calendar year, which for many companies is the end of their fiscal year, there are likely more RIFs to come. Now is the time that company leaders are evaluating 2017 performance, planning for 2018, and making decisions about where to invest and what to adjust for long-term success. For leaders in companies that are having a tough year and anticipate that 2018 will not be significantly better, considering layoffs is a natural option.
Just as we hire employees to shape a future workforce, it’s important to handle RIFs and layoffs to shape your future organization. It’s no longer about downsizing; it’s about right-sizing and right-shaping your workforce. More than a numbers exercise, the overarching goal is to retain the employees you need to move the company forward – in a way that keeps them engaged and proud of where they work. There are lots of ways to muck it up! Here are five tips for managing a RIF the right way.
1) Assign Resources to the Effort.
Pulling off a RIF is a tremendous undertaking. To do it well takes the time and commitment of a team of people. Assemble your RIF team to guide the planning, communications, event, and follow up. You’ll want a mix of executives, HR leaders, and line of business managers to make the hard decisions and execute the plan as clearly and compassionately as possible. Those who are not directly involved may need to pick up the slack from those who are on the team.
2) Shore Up Job Descriptions.
You know that keeping job descriptions up to date is essential for recruiting the right employees. For the same reasons, you’ll need updated job descriptions that describe your go-forward jobs in the organization. Make sure you’re documenting the skills your organization will need after the reorganization, not the skills of those roles or people that you’re attached to. This exercise is prone to human error, so be sure to align desired workforce competencies with the organization’s goals to help make the best decisions.
3) Communicate. Communicate. Communicate.
There are usually signs of potential layoffs long before anything happens. Often, employees will notice changes and cutbacks that may signal an effort to delay or avoid cutting headcount. Before long, rumors are flying. While rumor mills are common, they aren’t a big help for figuring out what’s really happening. Once your leadership team decides to do a RIF, your best bet is to confirm the facts. In writing. To employees. It may seem counter-intuitive, but communicating the facts of a RIF – before, during, and after the event – can go a long way in keeping employees more focused and engaged when you need them the most. For those that leave the company, communication can help take the sting out of the process and better arm them for their next steps.
In this great blog, Jeff Neal, former Deputy Personnel officer at the Department of the Navy, describes a RIF that he led in the Naval Aviation Depot (since renamed Fleet Readiness Center Southeast) in Jacksonville, Florida. It involved 1,500 of their 3,200 employees in an attempt to make them competitive in an upcoming round of base realignment and closure (BRAC). To squelch rampant rumors and prepare personnel for the inevitable change, the RIF team published a series of RIF Facts. Employees read the publications and asked for more. They even started submitting rumors when they heard them, to ensure they were getting the right information.
4) Aim to Execute Flawlessly.
Adopt a plan-brief-execute-debrief approach to ensuring that you’re protecting your employees and your organization. From the start, focus the team on making hard decisions with the future of the organization in mind. Likewise, make personnel, process, and communication decisions that are legally compliant with federal, state, and industry regulations. Provide support for those employees transitioning out as well as the team that managed the RIF. Offer support, too, to those remaining employees who will be adjusting to their new work reality.
5) Move Forward. Together.
The RIF is complete once all those who need to leave are gone – after any appeal process that needs to happen – and all those who are staying are engaged in their newly defined roles.
One company we know laid off two-thirds of their employees in one day. The CEO then assembled the remaining employees saying, “We chose you to work with us. We hope you decide to stay.” That statement reminded each employee that they had their own decision to make about what happened next – an important sentiment following a disruptive event that can leave so many feeling powerless. The CEO then outlined her vision for the company, her hopes for what the team could achieve together, and the importance of each person’s contribution. Starting on day one, employees had a shared picture of what could be ahead for the newly configured workforce and organization. With continued communications, 96 percent of the remaining employees chose to stay and were with the company one year later.
RIFs are never the first option; they become a reality when the alternative is worse. Handled well, a RIF can ultimately reinforce a positive company culture, foster employee loyalty, and position an organization for future success.
As you’re planning now to position your organization for future success – regardless of whether that planning involves a potential RIF or layoff – our “6 Best Practices Related to Competencies That Drive Workforce Success” white paper may be a useful reference. Or contact us about Avilar’s workforce planning consultation and solutions.