Manage Downsizing during a Recession

Making sure that downsizing is the right decision for any company is more than a difficult decision, especially during a recession. Knowing about alternatives might help a business keep its valuable employees intact, and still create an atmosphere of positive changes for the company.

You know, there are two ways to handle downsizing – you either are compassionate about it or you just want to get the nasty business done and over with. Which one are you going to choose?

It’s really simple. Do you want to create enemies, or have people despise you for the rest of your life, or build a stronger bond between you and the people who have stood by you all these years in your business?

Downsizing is really a heart-wrenching experience, but it is a real issue with many businesses today. So, here are some tips on how to manage a downsize.

First, you have to establish a communication line between you and your staff. Would you want to be hit by your clients suddenly just dropping you without warning? That’s the same principle with your staff.

In fact, if you make them aware that there are problems, and get their cooperation to try to pull the company out of this recession period without too much damage, then imagine what a great team you have! Not only do they care about their jobs, they are willing to work better and more efficiently to keep their jobs.

The worst thing you want is to have rumors spreading about lay-offs, and retrenching. This is really just a useless activity. Your employees are worried, and on top of that, they are not productive.

Also, if you give them the “pink slip” on the day of their lay-off, they will have to manage to summon enough nerve to even walk out of your office with head held high. You will be branded to be some kind of horrible executioner, and then the rest of the staff in fear of their own jobs.

Instead, what you can do, if there is no other option but to lay-off some employees is to prepare them with a safety net.

You could have separation packages, seminars on financial management, career planning, and even recommendation files.

For the employees you plan to keep, you must also prepare them for the rough road ahead. First, you need to assure them of your need for them, and provide them with your business vision. You need to deal with their anxiety over the changes and the re-organization.

Some of your valued employees must decide to jump ship when they hear about your lay-offs. If you communicate with them your plan, they might be willing to stay, and help you get through this period.

Finally, communication is still the most important tool you have when dealing with employees. Some of them may even be willing to work shorter hours, get a smaller paycheck, decrease benefits, or not receive overtime or differential pay, if they can get to keep their job.

Your leadership during times of recession is what will keep your business alive. This not only means making difficult decisions like lay-offs, but also encouraging your staff to strive for more success. As the leader of your business, you need to keep an upbeat and realistic attitude about the economic crisis.
Other Best article on Recession:

Quote of the Day:
“When change is not handled well, additional loss of jobs can occur. In addition, demoralization of the work force; increased worker turnover; decreased cooperation and teamwork; and increased levels of stress, anxiety, absenteeism, illness, and mistakes can follow.”- Morton C. Orman, M.D.

Downsizing has its perils, and all you need to do to avoid them is to care for your employees and how their lives will be affected by sudden changes.


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