Background
The air is stiff and you can almost hear the tense, deep breathing of folks in the room. All the senior leaders are here, including those on video from our overseas office. Any passerby can tell this is a very serious meeting.
The APAC Managing Director has just announced the Board decision to lay off 25% of total headcount, effective end of month. Ceci E., the Head of Human Resources of Asia Pacific, looked over to her calendar, which will be 30 days from today. As the newly appointed Project Champion for this layoff initiative - she’s got work to do.
What would you do if you were in Ceci’s shoes?
As an HR professional and leader, we take on a crucial role in balancing and fulfilling the needs and benefits of the company and the employees. It is during critical times like this where every step can have a ripple effect that impacts many.
For well established international companies, there is usually an HR playbook that provides a step-by-step guide for the leadership and HR team to execute on their layoff plan.
But in view of the New Normal we are in, how effective would it be to just follow the playbook? Will this help us maintain the HR vision for a satisfying total employee experience for both the “survivors” and the “affected” team members?
In my past 20+ years’ in the global HR leadership role, I have taken on multiple rounds of global restructuring initiatives and have personally been part of the leaving team twice. As a veteran HR leader and an Executive Coach, my goal is to support other HR leaders to achieve that same vision.
In this guide, we will not only provide you with industry best-practice in planning out a layoff plan but go beyond in sharing with you alternate approaches that will take your plan from good to great.
Step 1: Getting Started
The first step is always the hardest but the most important. It is critical for us to get foundational aspects such as legality and company direction both sorted first.
The Common Approach
Check and confirm the latest local law
Establish an anchor and foundation for upcoming decisions
Understand the company’s short, mid, to long term expectations including future business goals, financial goals, future manpower plan, etc
Check on precedent layoff case
Align this with core corporate values
The Alternative Approach
On top of what was mentioned in the common approach, we take an additional step. A step that shifts your role from a highly efficient HR leader to a strategic partner that sees beyond the rulebook - you do your due diligence:
What is the goal for total employee experience and employer branding?
What is the company’s overall financial standing? Are there any financial buffers for you to potentially compensate leavers above the law?
What are the industry norms?
How have your industry leaders and competitors responded to similar situations?
As an HR business partner, it is crucial to remain objective and be intentional in building a strategic footprint for the company’s future development, even in the face of challenging times.
Step 2: Leveraging Resources (Internal & External) As a project head, it is important that you understand and leverage resources in a diligent manner. With the confidential and high-stake nature of the layoff, who would you consult or engage with internally and externally?
The Common Approach
Internal
Regional Leadership Team for directional alignment
Regional & Country HR Team to strategize
Regional & Country Legal Team to minimize legal risks
HQ HR for global standardization
Internal Communications team for crafting the “Layoff Message”
External
Optional: External Employment Lawyer (especially when senior leavers are anticipated)
The Alternative Approach
As an HR leader, we are probably quite skilled and used to high-stake communication. However, the potential (negative) impacts and risks are certainly considered highest with layoffs. With total employee experience in mind, it might be wise for HR leaders to consult with an Outplacement Service Provider. This will provide you with additional support in ensuring that affected employees’ professional, emotional, and career transition needs are met.
If resources are available, it will also be hugely beneficial to hire a communications coach to support leaders who are in-charge of communicating the “bad news” professionally and keeping the affected members’ emotions in check.
One of the most emotionally charged Layoff communications that the leavers care the most is the “Why Me?” question. There is, and will never be, a standardized “right” answer, but one that has a long impact on the leaver.
Hence a well thought through, empathetic, precise, concise, and consistent message should be adopted as the benchmark.
Why should we go the extra mile when planning for a layoff?
In the New Normal, it is highly predictable that company restructuring is going to be more common and more frequent. Hence, when considering employee experience, we must learn to see beyond the “survivors” but also consider the rising number of “affected” team members in the face of a layoff.
With the increasingly blurry lines between business and personal life, professionals are more actively sharing their work ups and downs on personal Social Media. Business leaders must be cautious that every decision, message, and action the company undertakes might be placed under a magnifying glass by the public - especially when it comes to topics like a Layoff.
A highly respected, transparent, sincere, empathetic, and clear layoff message is more crucial than ever. It is not hard to understand why the Airbnb CEO Layoff letter went so viral within days in May 2020.
Step 3: Prioritising on the Who, Why and How The discreet part of the role of an HR leader is that, technically, everyone is your stakeholder, and sometimes their needs might be conflicting. So, the last critical question to ask when deciding on the strategy is how to prioritize the who, why, and how.
The Common Approach
The harsh reality is, resources are scarce - despite how much we would want to, we can’t give everything to everyone. Of course, the logical decision would be to prioritize the “survivors” - the ones who are staying and will continue to be our internal stakeholders and offer “leavers” likely just the fundamentals, what is legally required.
The Alternative Approach
As HR leaders, it is, of course, obvious why we must go beyond just doing as the law requires regardless of the impact of social media such as Glassdoor has on employer branding, the key is how can we translate that into “business terms” and influence our leadership team on arriving the same “HR decisions” for the benefits of the “Business”.
Uphold company core values - if one of the company’s core values touched on the importance of people, then this is the best opportunity to walk the talk.
Strengthen company brand and alumni relations - provide leavers with professional career transition assistance will allow them to rebuild emotional resilience and instill success in their next career chapter much quicker, something far more impactful and appreciated than a marginally higher payout package.
Rebuild trust with “survivors” - the impact of a major layoff goes far beyond the leavers, the ones that “survived” would also be impacted emotionally and motivationally. Their fear, concern, and worry will be drastically reduced as they see how their company remains as a Caring Employer during critical times.
In view of the more and more volatile and complex business environments that we are in, our role as business savvy and people-centered HR has been transformed and is heading towards more and more internally and externally linked.
This is especially important as we champion Employer Branding and Total Employee Experience. Our ability to influence and shape the Employee and Leaver Experience through good and bad times will be a key driver in enabling the company to win in the future war of talent.
One Step Further: Leveraging innovative ideas to proactively combat the impacts of the New Normal?
One key impact of the New Normal, that is we are facing a business environment that is even more volatile and uncertain than what businesses have experienced in the past few decades. It is harder now than ever to predict when or whether another round of layoff will happen. As HR leaders, we must shift our approach from reactive to proactive and be creative in innovating ways to combat the impacts of the New Normal.
Formalize an Alumni Program
Encourage and invite leavers on amicable terms to be in touch with the company after separation
Build and strengthen employer branding via Alumni
Establish a Graduate Program
Enhance Employee Experience by supporting high performers to achieve their career goals even outside of the Company
Create programs to reward individuals who are effective, reliable, and performing
Design a Graduate Incentive Program that will enable qualified individuals to achieve their next best career move through career coaching, resource support, and job referrals
Incentivize honest feedback and creative ideas
Tap into and maximize internal experience and knowledge
Leavers are the best “critiques” of the company’s SWOT analysis, especially its Weaknesses & Threats.
Encourage bottom-up problem solving on strategic initiatives. Be open to empower solid and sensible business idea generators of the internal talent pool to take on the role as project owners for their proposals
For new business ideas, develop “Intrapreneur” schemes to home-grown new “business leaders” for sustained business growth in the new business arenas
Cultivate a “Growth/Change Mindset”
Organize learning initiatives such as chill and learn workshops on key topics like “Growth Mindset” and “The Fastest growing (Technology) Trends by 2025” to nurture employees with an improved sense of urgency and aspiration for growth
Video record those workshops and share with the community at large to strengthen the learning culture inside and outside of the company
Conclusion: Layoffs are unideal for everyone, but in many cases, it is inevitable in view of the ever-changing business environment especially under the New Normal. Needless to say, HR’s role is tougher and more crucial than ever. We continuously take on a change agent role in spearheading the company turmoil from good to great by revitalizing a Layoff Plan from cost-cutting to an opportunity to actively enhance Total Employee Experience beyond the D-Day.