Have you been affected by downsizing in your organisation during the economic downturn?
The after-effects of downsizing in a company can last for years, as you try to encourage the people who stay to commit their loyalty to the future benefit of the business.
But we’ve found in our research that many companies spend a disproportionate time on helping the people laid off and less real-time on the people who will be left, and that may store up difficulties for the future.
When you manage downsizing ineffectively, there’s a danger that a downward spiral will be set up, which can be damaging to the morale and performance of the whole company. Learn More
As the economy struggles more and more employers are looking to downsize their workforce in order to cut back on costs. They figure that getting rid of employees is the best way to save money and are thinking about the present – where business is dwindling.
But what happens when business picks back up again? Will you have the workforce you need and – most important – will you be able to find the same high-quality help you let go just months earlier?
As a leader and manager you’ll be partially responsible for determining if layoffs are necessary and, if so, who has to go. I don’t know about you, but that’s not a situation I’d enjoy being in.
Instead you need to take some time to think about whether or not layoffs are really the answer to your problem. Start by projecting your future level of business. Are things progressively getting worse? Do you see a chance or opportunity for improvement on the horizon?
There are quite a number of options, aside from downsizing, that can help organisations to cut costs. They include:
You’ll be suprised at the number of options you really have when it comes to cutting costs without getting rid of your key employees. You might even want to ask your employees to brainstorm with you one day. Perhaps if they feel as though they were able to participate in the process they won’t react as negatively to the actions your organisation takes. It’s your job, especially as one in a leadership role, to make sure you’re making the right decision.