Take the sting out of lay-offs

Managing retrenchment requires values and a long-term focus

Manjari Raman

IF you really want to know what a no-holds-barred lay-off feels like, recall the Titanic scenes. The ship doesn’t sink silently or swiftly into obscurity. Instead, in agonizing detail you hear the scream of tortured metal, the wrenching sounds of the hull breaking, the sickening churn that threatens to drown everything in sight, and the last lingering groans as the ship finally sinks into its final journey to the bottom of the ocean.

That’s the kind of anguish that swirls around a corporate in the middle of a retrenchment. The pain was sharply driven home late last month, when it happened to a dotcom whose mailing list I was on. My inbox was flooded with hate mail as one after the other employee — and even ex-employees — began writing to as many people they could think of, sharing the angst.

Now, this was no fly-by-night operation: it was the India operations of a global dotcom brand, which had launched operations with much fanfare last year. Interestingly, none of the laid-off employees expressed shock that they had lost their jobs. All were outraged at the manner in which the message was relayed to them: at noon, in walked a suit from the USA into the Mumbai head-office. He bluntly announced that the operations were being shut down from that moment on, and on a note of gallows humour concluded: ‘‘Don’t come back after lunch.’’

If you think I am exaggerating, visit f—-edcompany.com (for those who can’t be bothered by newspaper niceties, spell out the full expletive) and take a look at how managements botch up the sensitive task of telling people that their job — which gives them a sense of security, self-worth, a reason to get up in the morning and go out and do something productive — is gone. And how hurt and betrayed employees feel by the manner in which the news is broken.

Here’s a sample message from the site. (I’ve replaced the actual company name with ‘‘CompanyDead’’ as the law seems to be tougher on print reporting than on Net journalism):
CompanyDead: Now I am unemployed too. Rumour has it CompanyDead laid off around 87 employees, around 50 per cent of staff today. No severance, no notice, effective immediately. As a final “**** you” to their employees, they shut down all internal servers so remaining employees couldn’t email any of this info to their friends, associates, or to me...

Was CompanyDead doing damage control or worsening the situation? Go figure. While I can understand that despite the best intentions, managements can go wrong in strategy and as a last resort need to ‘‘get rid of people’’, I simply can’t figure out what gives them the right to butcher corporate values while doing this. Not only is a curt termination downright caddish, it hurts the corporate brand; irrevocably damages the corporate’s ability to attract fresh, good talent; and frankly, a mismanaged retrenchment clearly shows a management that is bumbling and inept.

Moreover, any management which believes that its soon-to-be-ex-employees deserve no time and attention will soon see that strategy boomerang. The most immediate impact is on employees who are still on the rolls: the harsher the treatment to retrenched employees, the greater the insecurity in those left behind. Instead of being a highly-motivated lot who should be focusing on how to bring the company out of the doldrums into calmer waters, these employees now live under constant fear of the sword. Instead of pushing on productivity, they are now focused on polishing resumes, scanning the classifieds and hunting for a more secure job in a more trustworthy company.

This isn’t just the worm’s eye view — smart companies know that they need to minimise the damage control retrenchment brings by being open, sensitive and values-led while planning a layoff. Scrolling down the f—-edcompany.com postings, I found a memo to Cisco employees in the first week of April 200, which highlights how retrenchment need not be more painful than it it. Firmly focused on the long-term health and reputation of the company, the Cisco note shows that even in this difficult time the company is clinging to the ‘‘core values of trust, open communication and integrity’’.

A formal transition support strategy has been worked out and shared with all employees. Each affected employee is to receive two months’ pay and benefits continuation to seek a new assignment or other employment outside of Cisco. Those who sign a severance agreement get an additional four months’ pay and benefits continuation.

To ensure that information is freely and fully available a Transition Website has been set up. Then, displaced employees are being offered extensive outplacement support: right from career counselling to resume writing. Finally, Cisco partners and customers have been offered the chance to interview and hire affected employees as a first preference. Clearly, smart companies retrench with brains — and a heart.