The measures to contain COVID-19 have had a huge financial impact, which has left many companies either implementing or considering cost reducing or downsizing strategies. This is not an easy change to manage in the best of times and handling this remotely will bring significant challenges to leadership and management teams.
It’s easier said than done, but following a fair and consultative process, retaining your top talent and quickly working to rebuild morale will set you up for success following implementation.
Whether your company has already begun cost reduction measures, or you’re still deciding which strategy to take… the question remains, how will you manage these changes in a way that minimises the negative effects on your business and employees in the future?
It can be a period of great uncertainty and stress for any business undergoing cost reducing or downsizing initiatives and productivity will most likely be affected. However, by understanding the impact on your people and putting the correct structures in place to manage the transition, you can begin to rebuild your business and increase productivity much sooner.
Some key questions to consider
What cost reduction options are available to you?
How will these changes impact your strategy and vision?
How will you rally support from your leadership team and colleagues?
Will your structure need to change to deliver your strategy and what skills or capabilities will you need to retain in the new organisation?
How will you minimise the spread of misinformation amongst remote employees?
How will you rebuild morale so that the impact on productivity is minimised?
Drawing from our experience in helping companies implement cost reduction and downsizing measures, here are some of the lessons we’ve learned
Consult where possible. Make decisions consciously.
Avoid knee-jerk responses without due consideration of your strategy and vision. Work closely with managers and HR to develop a human-centred strategy and roadmap that will help you communicate the urgency and benefits of the planned change and inspire buy-in. Anticipate risks and explore ways to address them. Most importantly, ensure compliance with labour legislation. This is where HR becomes extremely important and where you can work together.
Since the impact of COVID-19 is virtually inescapable, changes won’t come as a shock, but appropriate communication is still important. So think about the most empathetic and people-centred way to announce cost-reduction measures. Where possible, communicate impacts on jobs verbally and follow up with written communication. Provide clarity on the ‘why’ for employees and ensure there are regular opportunities to engage people personally regarding their concerns. Due to remote working, it may be easier to ‘ring-fence’ and address those affected specifically. Sometimes, there is such a focus on those affected, that those employees who aren’t impacted by a restructure could be left feeling anxious if not engaged timeously, so keep them in mind too.
Empower your messengers.
Managers are usually tasked with handling a downsizing or cost cutting process with their teams. The more involved they are in decisions taken, the easier it will be for them to deal with questions and concerns from employees. Make sure all managers have supporting materials such as key messages and FAQs to rollout the process in a consistent manner across the company. Develop online tools to track perceptions and measure effectiveness of interventions to course-correct as needed.
Retain your top talent.
Early in the process, identify your top talent and formulate a strategy to retain them. Communicate with them timeously and find ways to involve them in future-focused, purposeful activities so that impact on morale is minimised.
Rebuild your new normal.
Even if you do manage a downsizing process well, those employees remaining or affected may still have low morale having lost colleagues or other benefits. Whilst acknowledging their loss, it is important to assist employees in finding a renewed purpose. Be sure to revisit your vision and values, especially if there were fundamental changes made to your strategy and ways of work. Unpack with employees the behaviours and attitudes required to rebuild a new normal.
The rebuilding process is not an easy task, but a steady, considered approach is key to minimising criticism and returning to a stable, productive place. With a little tact and consistent communication, you’ll be back to work in no time.