FC NOW: The Fast Company Weblog
December 20, 2004
Question of the Week
Should leaders feel guilty about layoffs? Tell the Corporate Shrink what you think.
Posted by Heath Row at December 20, 2004 6:15 PM | Category: human resources |
7 Comments
ADVERTISEMENT
FC NOW MENU
NEWSLETTERS
FC NOW CATEGORIES
FC READS
It depends on the criteria the leader uses for deciding who gets laid off. Often times the company wastes resources on the "turkeys" (poor performers), until they suck the company dry. Then all at once they decide their only solution is to make significant cut backs.
Look around...if you're laying off your "eagles" (high performers), and there are still "turkeys" in the midst sucking up your resources...go ahead and feel guilty...you haven't done your job.
Yes, without a doubt.
Layoffs are a failure of a basic management competency: resource allocation. Very few "sudden turns" are completely sudden. Leaders have the responsibility to manage the business well, and that includes the people resources that operate the business.
Unless it is an absolute last resort to save a viable business model that will continue to serve a useful purpose in the marketplace, they should not only feel guilty, but include his/her own pink slip in the stack. Restructuring is too often used to cut payroll in lieu of competently managing the growth and maintenance of the business, because salaries are such a big target. Layoffs generally have the most personal impact on the individuals with the least culpability in the circumstances that led to the layoffs.
What we too often fail to understand is that layoffs are not always a failure of the manager who needs to make the layoffs. Sometimes it's the failure of his boss, or his boss's boss. Maybe it's further up than that.
The manager who has to make the layoffs is typically not even involved in the decision that layoffs are the solution to the problem; it was passed down on him/her to reduce staffing by 5%, 10%, whatever.
Layoff guilt comes into play because of personal feelings for those manager's supervise. It's not necessarily a bad thing: empathy is one thing most of us feel our managers could use more of.
A manager is asked to take the responsibility that the good of the corporation is more important than the good of those they supervise.
It isn't bad to feel guilty, but by acknowledging it, grieving appropriately, and moving on, managers can lead their organization well into future successes.
Corporate restructuring - real and euphemistic – is a fact of life. It will be inevitable the market forces will change and require companies restructure to continue to meet customer’s needs in a manner that maximizes value creation for both parties. However, this does not excuse any restructuring and resulting layoffs. I think as a manager that any layoff is a poor reflection on our performance – that we were caught unaware of the changes in our market or that we allowed sales growth to slow or reverse such that once-necessary staff became surplus.
Guilt is a common emotion, and useless unless you want to live with negative energy. As a leader dealing with shifts in work force you want to ask yourself several questions:
1. Have I considered all options available, and then made the best decision for the business & key stakeholders?
2. Is there an opportunity to use training and job placement to move employees into other areas of the business?
3. Have I brainstormed and considered "out of the box" opportunities with all key interanl stakeholders, HR, Fianance, Product Development, R&D etc? Often we ignore others who may have ideas that can help avert what we think is the inevitable.
4. Finally when you believe people must exist the business, are you providing a package that supports their transition? Outplacement, salary/medical coverage for a period of time, mental health care etc. If I believe the business has a purpose for their action, it is explained to me fully, and I am "taken care of" I feel better about the situation.
These steps can help reduce or eliminate the useless energy of guilt.
If, by "leader," we mean "executive," and if the leader knows full well that the purpose of the layoff is so the company can afford bonuses at the end of the year, then yes, the leader should feel incredibly guilty.
I've been in too many crappy companies to believe that market forces alone are responsible for layoffs. And I've seen too many accounts of successful, industry-leading companies managing their growth appropriately and hiring intelligently to believe that layoffs are simply a fact of life in the private sector.
The fact of life is that most companies are run by idiots. And it's idiotic management decisions that result in most layoffs.