Leadership Barometer 33 Downsizing Tips

January 13, 2020

Every organization deals with downsizing occasionally in a struggle to survive difficult economic conditions. These times are true tests of the quality of leadership.

In many cases, downsizing leads to numerous problems in its wake, especially lower trust.

The most crucial shortage threatening our world is not oil, money, or any other physical resource. It is the lack of enlightened leaders who know how to build trust and transparency, especially when draconian actions are contemplated.

We are in need of more leaders who can establish and maintain the right kind of environment. A serious problem is in the daily actions of the leaders who undermine trust, even though that is not their intention.

The current work climate for leaders exacerbates the problem. The ability to maintain trust and transparency during workforce reductions is a key skill few leaders have.

Downsizing is a unique opportunity to grow leaders who do have the ability to make difficult decisions in ways that maintain the essence of trust.

Thankfully, there are processes that allow leaders to accomplish incredibly complex restructurings and still keep the backbone of the organization strong and loyal. It takes exceptional skill and care to accomplish this, but it can be done.

The trick is to not fall victim to the conventional ways of surgery that have been ineffective numerous times in the past. Yes, if you need to, you can cut off a leg in the backwoods with a dirty bucksaw and a bottle of whisky, but there are far safer, effective, and less painful ways to accomplish such a traumatic pruning.

One helpful tool in a downsizing is to be as transparent as possible during the planning phase. In the past, HR managers have worried that disclosing a need for downsizing or reorganization might lead to sabotage or other forms of rebellion.

The irony is that, even with the best secrecy, everyone in the organization is well aware of an impending change long before it is announced, and the concealment only adds to the frustration.

Just as nature hates a vacuum, people find a void in communication intolerable. Not knowing what is going to happen is an incredibly potent poison.

Gossip and rumors generally make the problem bigger than it actually is, and leaders find themselves dealing with the fallout.

Human beings are far more resilient in the face of bad news than to uncertainty. Information freely given is a kind of anesthesia that allows managers to accomplish difficult operations with far less trauma. The transparency works for three reasons:

1. It allows time for people to assimilate and deal with the emotional upheaval and adjust their life plans accordingly.
2. It treats employees like adults who are respected enough to hear the bad news rather than children who can’t be trusted to deal with trauma and must be sheltered from reality until the last minute.
3. It allows time to cross-train those people who will be leaving with those who will inherit their work.

All three of these reasons, while not pleasant, do serve to enhance rather than destroy trust.

Don’t humiliate people

Another tip is how to break the news to someone who will be terminated. One way to handle the situation is to ask yourself how you would like to be treated if the situation were reversed. Would you like to be paraded down the hall to pack a box with your possessions and escorted outside the gate and forced to hand over your keys and badge?

Many enlightened leaders have handled the separation in a more humane way. They break the news to the individual and share that the employee needs to find alternative employment. They may even offer assistance with ideas on where to look and offer for a reference.

Then, the employee is not immediately escorted off the premises, but is allowed to pack things up over the next several days and say good bye to friends and work colleagues. Some employers have even experimented with letting the impacted worker use the facilities and equipment for a short while during the job search.

HR managers will quickly point out the risks of having formerly employed workers on the premises, and it is true that the person needs to understand that if he or she is disruptive in any way, then the leaving will be immediate.

The idea is that when you treat separated employees with respect and kindness, even when the news is not good, they respond with a better attitude, which generally improves the outcome.

The more powerful result is that the employees who are not leaving are also impressed by the way these former colleagues were treated. That factor tends to bolster morale a bit for workers who are now asked to take up the slack.

Full and timely disclosure of information and thoughtful exit processes are only two of the many tools leaders can use to help maintain or even grow trust while executing unpleasant necessities.

My study of leadership over the past several decades indicates that the situation is not hopeless. We simply need to teach leaders the benefits of building an environment of trust and transparency and how to obtain them.

Robert Whipple, MBA, CPLP, is a consultant, trainer, speaker, and author in the areas of leadership and trust.


Gaming the Games

August 5, 2012

I suspect you were outraged when three badminton teams were disqualified from competing in the Olympics after they intentionally lost their matches in order to get a better position in later rounds. After all, the Olympics are supposed to be about sportsmanship, fair play, trust, and honor. It makes an interesting analysis why intelligent young athletes, who have trained countless hours and sacrificed years of time to be the very best in their chosen sport, would risk losing the ability to compete in order to gain an illicit position advantage.

At every Olympics, there are scandals where athletes find some loophole to exploit in their quest to be called the best. The irony is that when they wake up in the morning, they have to live with themselves, knowing the cost of their victory was the very thing that made them losers. How pitiful; they managed to snatch defeat from the jaws of victory. They tarnish their medals.

The problem is that we give the people who cheat and get caught suspensions, but we give the people who cheat and don’t get caught medals. I am not saying that all athletes cheat; far from it. I honestly believe that the vast majority of participants do play by the rules. It would be interesting if we could ever determine the exact percentage of honest competitors who would rather play the rules and lose than find a way to cheat and win.

One could argue that the people who cheat are from countries who have a political need to always be the best, regardless of the tactics. Their warped sense of supremacy gives the games a political intrigue that is unhealthy, but always present. While national pressures can be one cause for the rot, I believe there are individuals from any country that would game the games if given the opportunity.

I believe the real culprit is the pressure to win, which is ironic because that is the core reason for the Olympics in the first place. Playing by the rules involves making thousands of hard choices over years of time. The burning desire to be called the best drives athletes to walk up to the point of doing inappropriate things but never cross that fine line.

That conundrum appears to be a bigger challenge than to swim faster than any other human being alive. To take advantage of every training aid and legitimate nourishment regime but never go one micrometer beyond is pressure of a different sort. For those athletes who do not compromise their integrity, I think there should be a medal of trust. They have earned it, and when they wake up, they have the joy of knowing they competed at the highest level whether they won or lost. They are the true winners.

We cannot ever tell who cheats just a little bit in some rule of competition. That would be impossible. Rather, we have to rely on the forces within individuals to drive most athletes to take the high road and snatch personal victory from the jaws of defeat.