You know there are some things that happen that you just hang your head and ask, “What were they thinking?” I had a situation like that this week when a friend called to tell me about “the BIG announcement” the leadership team made where she worked.
It seems that her business has been struggling all year in this fragile economy, sales are down about 40% and the market is not projected to fully recover for another 2-3 years. In spite of these grim projections, however, their CEO continues to send quarterly emails to all employees praising them for their sacrifices and accomplishments in this tough year and elaborating on how well positioned the company is to capitalize when the economy recovers.
Well, it seems that being well positioned isn’t enough in these tough times and an additional reduction in headcount is needed.
As you can see from the sustained 40% decline in sales, a reduction is not completely unexpected. And, although it’s the holidays, it’s not unusual for companies to announce reductions in the 4th quarter as they work on year end balance sheets. But what is disturbing in this situation is the fact that the company decided to announce to their 10,000 employees they will be reducing 150 employees in January, but they didn’t tell the employees exactly which jobs would be eliminated! So, instead of having 150 employees worried over the holidays, they now have 10,000 employees worried because no one knows if they are going to be affected or not.
Talk about unintended consequences! Can you imagine the back biting and positioning that will be going on over the next 4-6 weeks with everybody jockeying for position and trying to ensure they are NOT on the proverbial list? And who wants to buy presents for their family knowing they may need that money just to survive in this economy? This is reminiscent of Chevy Chase as Clark Griswold in Christmas Vacation where he has already written the check for the family’s new pool and is eagerly awaiting the mail carrier’s arrival with his annual bonus check so he can cover it. Instead, when the mail carrier finally arrives, the ‘bonus” is actually a membership to the jelly of the month club! Sorry Clark – it’s a cost cutting measure.
This is why this announcement goes under the heading “What were they thinking?” A more compassionate response might have been waiting until January to announce the reduction if the leadership really doesn’t know what positions (people) were going to be affected. Or better yet – do the extra work in December to determine which positions (people) will be eliminated and actually tell those individuals BEFORE the holidays? Where are the Human Resources people in this organization – or are they too scare to stand up and say anything for fear that they may be on the “list”? Either way, Human Resources is still supposed to be the conscious of an organization. Remember your employees are your most valued asset – they’re not human CAPITAL like a piece of equipment. So please don’t stand back and let your team make a bad decision – come to the table with a plan to support both your company and your employees. In other words “Do the right thing!”
News that you are going to be part of a reduction is never easy, but knowing and being able to actually DO something (like planning your next move, updating your resume, and reaching out to your network) is better than wondering and worrying with no control over your destiny at all.
Although this “announcement” is questionable, I will give her company credit – the actual effective date of the terminations won’t be until later in the first quarter and employees are eligible for severance.
The moral to this story is this: put yourself in your employees’ shoes. How would YOU want to be treated in this situation and ACT accordingly.