Steer Remaining Staff to Success After Downsizing

By Article Guy On December 29, 2009 Under Jobs

Between December 2007, the official start of the current recession, and June 2009 more than 40,000 U.S. organizations held layoffs in an effort to reduce costs, increase profits, and improve shareholder value. Unfortunately, studies over the past two decades have shown that most of the time layoff initiatives rarely actually achieve those objectives. Rather, the studies have shown that less than 50% of organizations that cut staff and employees actually increase their earnings, and about a quarter of those companies realize a decline in profits instead.

 

Why don’t layoffs produce the returns executives hope they will? In short, it is the effect on the employees left behind.The downsizing effects them both psychologically and emotionally in very big ways. At the very point in time when employees must be fully functioning and able to take over the tasks of those who were laid off, they are unnerved, frightened and skeptical. That combination is deadly for the overall success of the company.

 

My colleague, Deanna Banks, Ph.D. and I spent the past six months studying what leaders can do to re-energize their workforce after layoffs. We found that certain types of leaders are more successful than others at enabling staff to recuperate from the damage that layoffs cause.

 

What Not to Do

 

As we interviewed employees from companies that had layoffs, we often heard stories of management teams that took action to stifle any expression of emotion. One example went as far as a ban on employee socialization at coffee breaks, or in hallways and offices. Rather than understanding and dealing with the outrage their people are feeling, some leaders simply want people to get over it, now. They say “Just accept it and move on.”

 

The truth is that when emotion grips people, they simply can’t move on. It is critical they are provided the liberty to share their concerns and work through the emotions they are feeling. If management tries to rush this process and stifle the concerns the employees are expressing, the situation will only become more turbulent.

 

What To Do

 

Whenever a layoff takes place, everyone involved is forced into a state of disruptive change. Most researchers agree that people’s emotional responses to change follow a fairly predictable pattern.

 

If people on your team are suffering through emotional reactions to layoffs, you can’t force them to skip ahead. You may be over it and ready to move on, but until your employees are as well, you won’t have a support system to help. . Rather than pushing people to move forward before they are ready, you should be focused on working with your staff to successfully move steadily through the normal cycle of change and progress.

 

Interestingly, we discovered that the best strategy for helping employees recover from layoffs is one where the manager actually matches his or her actions to the emotions employees are experiencing. The objective isn’t to imitate the person’s emotion (e.g. respond to frustration with frustration). Rather, this means understanding what need is underlying the employee’s behavior and meeting that core need so the employee is able to move on.  

 

In our research, we found that successful leaders:

 

1.  Reduce shock by increasing communication.

 

 

2.  Respond to anger by expressing concern.

 

 

3.  Address anxiety by emphasizing clarity.

 

 

4.  Reduce grief and hopelessness by using supporting behaviors.

 

 

Employees who are emotionally supported are likely to be able to refocus on their job and maintain commitment to it. Instead of feeling miserable and distrustful, they will look to you for guidance. Rather than ending up stalled creatively, they will be more able to take control of their emotions and begin producing and taking necessary risks.   

 

While there’s no panacea for recovering from a layoff, how the layoff is approached, how employees who are let go are treated, and how the surviving workforce is supported go a long way to determining the organization’s future success and viability.

 

Wendy Mack is a professional advisor, trainer, and author with a focus in leading and communicating change. Contact Wendy at, or Download her free e-book, Transforming Anxiety into Energy at www.WendyMack.com