Horizon Management Group

In tough times we need to look at making changes to adjust to the circumstances. In previous newsletters we have discussed making the most of the people you have and how to recruit and develop the people who will make a difference to your business. However, when the world changes quickly sometimes we have to take actions which are less desirable than we would otherwise like.

Probably the least desirable for any manager is to cut headcount.

If it has to be done, let’s just make sure it is done properly. Below are a few key steps to ensure you get it as right as you possibly can.

Someone once said “we recruit people for what they can do and fire them for how they do it.”

To make sure you do not lose our valuable employees, those who “fit” with your culture, you need to separate people from jobs. To do this you need to review “what” people do, their responsibilities and results they need to deliver, and “how” they do it, their competencies and behaviours. Replacing people who fit with your culture is usually much more difficult than finding, or training, people to carry out the technical part of the job.

Revisit your business strategies. If you don’t have these, this is a good time to start documenting them. Identify the key processes you need to survive and then those that are needed to grow again when the upturn happens.

You should have job descriptions detailing what is done, or needs to be done. If not, this is another critical tool to put in place. Focus on jobs that add value which will help you identify which jobs need to be kept, which can be redesigned or which maybe eliminated.

If you haven’t already identified the values of your business and the core competencies and behaviours, this should be done. This will give you the template against which to compare your employees’ performance and contribution outside of the job description. Each organization has different core competencies or describes them differently. The key is to end up with specific behaviours which you want employees to demonstrate. 

Identify the people who can be out-placed by looking at performance, “what” they do and competencies, “how” they do it.

Err on the side of keeping people with the right competencies if you can provide training related to delivering the job content.

Just because you eliminate a job does not mean you need to lose the person doing that job.

You may choose to redeploy the person from the redundant job and lose someone from another area whose performance is below standard. This way you can downsize without losing the people you value. This is not always possible but at least defining the jobs and people separately will allow you to look at the options available rather than automatically losing the people that are currently in the jobs to be cut. 

Try not to downsize in instalments. In can be very destabilising to have more than one cut back. Everybody starts waiting for the next one and the good people may even start looking around.

Ensure you comply with legislation and implement any outplacement humanely, allowing people to retain their dignity. Your good people will be watching how you handle this and will judge how well you measure up to the values you espouse.

While downsizing is not a pleasant exercise for anybody, by being diligent when recruiting for the upturn and developing those valuable people who remain, you can possibly make sure the end result leaves you in a better position than when you started.