Companies consider options such as downsizing and restructuring typically when faced with profitability, efficiency and productivity problems. Other reasons leading to considering these options include action such as M&A, joint-ventures, divestment, introduction of new technologies, new organization concept … While downsizing and restructuring can lead to eliminating a business unit, change of processes, reduction of organization layers, it is the cutting of staff that is taken as the quickest action to reduce overhead costs. The latter is the most VISIBLE and talked about as it relates to PEOPLE and, more particularly, about “who is on the list” !
Performing a mass layoff as a consequence of a downsizing/restructuring plan requires that companies comply with laws and regulations involving different stakeholders both internally (Unions, employees representatives, employees) and externally (labour bureau, local authorities, employer association, Union Confederation…). Depending on the country, the efforts and money spent to perform a mass layoff can be very different thanks to business-friendly, or otherwise, the laws and regulations that are in place: Good packages, long process and high cost in certain parts of the world versus cheap and easy to let go in other parts of the world. At a time where competition for Talent is reaching new heights, with companies developing global policies, investing more money and seeking for innovative practices to beat the competition, managing layoff MUST attract an equal attention, professionalism and innovative practices towards not only those who are leaving but also towards those who are staying. And we recommend this to be developed wherever in the Globe the company operates. If we are good in attracting talent, we should be the Best when handling people exit processes under business less favorable environment. That ‘touch’ will be watched by your workforce, your competitors, your clients and the future Talent you`ll be hiring!
WHEN MANAGED POORLY, DOWNSIZING KILLS EMPLOYER BRANDING.