One of the unfortunate truths of business is that businesses go through cycles - during periods of growth people are hired, however when businesses go through downturns it is not easy to let people go.
While many organizations often say that people are their most important assets - the truth is that people are not like their other assets. Capital like land, machinery can be resold, but people cannot. The time and resources invested in hiring, training and developing people is only realised by their performance. When business declines due to whatever circumstances, people costs have to be written off.
As many business leaders found out during the first wave of pandemic, letting people go is not easy. It’s tough to tell people that they are being let go for no fault of theirs - either because of an external event like the pandemic or internal changes like a change in strategic direction (or as is more commonly known these days, as a pivot)
Layoffs must be (to borrow a term from the hospitality industry) HWC - Handled with C - where C stands for Care, Compassion and Communication
Layoffs in the new normal are different than earlier. That’s because conversations are mostly virtual and can cause people who are uncomfortable with dealing with empathy to deliver it coldly - or be perceived as cold by the people getting laid off.
In fact, a year ago, the phrase “Fired over Zoom” gained prominence in the popular lexicon as many people including a renowned journalist Jeffrey Toobin of the New Yorker used the phrase to document in public posts about the nature of their dismissals.
Let’s see what each of the C’s mean
The leaders in the organization must care about their people as human beings and not just their skills, talent or to see them as a pair of hands or “bodies” (as they are egregiously referred to in certain industries)
This does not happen in a vacuum, however. An organizational culture supported by structures and processes that recruit, promote and develop managers and leaders who care for their people.
You know a leader and manager cares about their people when they know each of their team members and their specific life as well as professional situation.
Compassion in organization is “empathy in action”. Empathy is putting oneself in the shoes of others and understanding the emotion they are going through. It means listening to the viewpoint without judging them. When an employee is given the negative news that they along with others are going through, they will invariably go through the five stages of grief as stated in the Kubler-Ross model - denial, anger, bargaining, depression and acceptance. A compassionate leader and manager needs to understand this and be with their teams as they go through the stages.
In these times when layoffs probably mean they will happen remotely - there are some principles. When in the middle of a difficult conversation, it’s common to focus solely on yourself: your ideas, your viewpoint, your feelings. But a “me-centric” approach can backfire.
Before communicating, leaders should have all the facts ready and anticipate what kind of most common questions employees will ask. It is imperative to get details from the HR, Legal and Finance groups on how the layoffs will be handled smoothly at a process level - so that people do not have to run from pillar to post, after they have been let go, to get what is rightfully theirs. The message delivered should be clear, concise, and unequivocal. People should not be left confused about their status. However, this does not mean that the message should be delivered coldly. If it is delivered via a video conference eye contact needs to be maintained.
When Airbnb announced that it was letting go of employees, CEO Brian Chesky authentically and transparently conveyed the company’s decision-making process and values. You can read the full text here https://news.airbnb.com/a-message-from-co-founder-and-ceo-brian-chesky/
How can organizations support the employees who are impacted?
According to this article by Randstad Risesmart: “When the difficult decision to lay off is made, employers who provide support for those impacted as well as those remaining, are employers who will be regarded as some of the best places to work when the time comes to hire again.”
This can be done by partnering with an organization that can offer career guidance and outplacement services to the impacted employees. This will ensure that professionally trained coaches and experts will be on hand to help with the planning and preparation, including manager notification training to ensure smooth transitions for the company and the impacted employees.
Layoffs are an unfortunate truth of businesses and while regrettable, business leaders can deal with it by treating their people with enough care, compassion and correct communication. A best practice that emerged was many leaders publicly sharing a list of impacted employees and urging other organizations to hire them. By doing such actions leaders display their commitment to their people.