During past downturns, layoffs were mostly a private affair. Big companies uses “downsizing,” and start-ups do it without telling the world anything at all.
Not anymore. In the age of transparency, layoff will be blogged.
Some bloggers had no choice other than to blog layoffs at the closely watched company — even though some employees had not yet been told they were losing their jobs.
They do these to prevent media reporters from writing articles that were not accurate and companies feel pressure to break bad news so that they can better control the message.
Today, whatever you say inside of a company will end up on a blog. So you have a choice as a company — you can either be proactive or you can have someone else to write the story for you.
To prevent destructive layoffs in companies:
- Making the tough decisions not to hire in the first place or replace less productive positions. Make the tough decisions now rather than later. It just gets more complicated with time.
- Sometimes it's better to have a position vacant than to hire poorly... especially in management. One bad manager can take down tens to thousands with them.
- Keep to continuous improvement. Productivity is the intermediate measure and if it's not always going up, you are becoming less competitive.
- Manage your financial, time, people, space, knowledge, energy, and material resources well. Look at Cost, Effective, thinking and organizing.
- Use both the pessimistic and optimistic views of the economy to shape your business decisions. Listen to people out there and test against reality and the predictions.
- Partnerships and joint ventures can allow you to leverage your core resources and push the variability to others or reduce it.
- Have everyone in the company on the team. Give everyone some level of influence over and responsibility for profits.
- Make decisions for the greater good of the corporation rather than betterment of top management.
- Those pessimists you are tempted to quash have something important to say. Listen but then take positive action on that negative view.
- Have a contingency plan to review if something bad happens than to have to invent something in the heat of a crisis.
- Manage your inventory as anticipating a slowdown can mediate the impact.
- Just because you announce a cutback, doesn’t mean there is unlikely to be a long-term positive impact on stock price.
- Invest in new processes and technologies.
- Expansion is fun, but excitement can hides the pitfalls of rapid growth. Capital can dries up in the middle of a growth spurt and build revenues based on contribution margin and profitability, not the top line.
- Be a team player and failure to look out for others has taken many entrepreneurs and managers down along with their employees.
- If a business unit isn't achieving its goals, it is unlikely to get better if you just shuffle the staff around. Fix fundamental problems and start with the top people.
- If you have to make layoffs, communicate and get everyone involved. Have a clear and fair policy on and take care of both the people being laid off and the survivors.
If you have run your company well to this point, people would understand that you have done everything you could to avoid this outcome.
Remember: “We always carry a responsibility for the people who work for us.”
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