ORGANIZATIONAL
DOWNSIZING:

A Manager Workbook

How well an announced downsizing will go for everyone concerned will depend to a large extent on what we as managers and executives do and don’t do. This memo is intended to help by outlining some of the dynamics of a downsizing situation, by sharing insights about the effects of downsizing and to suggest ways of helping those who will be leaving, as well as those who will be staying.

(1). BE AVAILABLE:

(a). We need to be around and available

(b). People need to see that we care and one best way of showing that is by expressing our feelings.

(c). It is important that we share our feelings and that they be in fact what we do feel. We have to be honest about what we do feel or else our efforts will backfire.

(d). We will be “dumped” on and the issue is to not respond in kind but to agree that they have every right to be angry, depressed, etc. The issue is “their right to feel any way they want”, but not to agree with the sentiment that XXXX could have done something different or that it could have prevented the downsizing.

(e). It is easy and in fact tempting to “disappear” and keep others at arm’s length – however, this does and will exacerbate the negative feelings of employees. It is equivalent to their feeling of being abandoned in a time of crisis by their leaders.

(f). All of their questions should be answered fully and truthfully. And, the less we respond with “we don’t know as yet”, the more positive the reaction. Just think about times when we or a close relative have been waiting for a diagnosis from the doctor and the call “takes forever” to come.

(2). SHOW THEM:

(a). The concern should be accompanied by direct action – this “proves” that indeed we are concerned and that we are not trying just appease them.

(b). Conduct “job fairs” in which representatives from companies in the area are invited. Invitations and announcements should be accompanied by direct and personal one-to-one invitations to ensure attendance.

(c). Access to therapy and counseling should be made easy and immediate, as opposed to having people go through a series of steps to get help. Also, the family should have access to this type of assistance. Be prepared to hear about wife-battering, children not doing well in school, unusual number of doctor’s visits for a variety of ailments, increased accident rates (both on and off the job), etc. All of these are reactions to the stress accompanying an organization shutdown or downsizing. Another reason for family involvement is that many employees will not want to admit to the need for counseling when in fact they will need it – the entrée, then, to helping them would be through the family.

(d). Encourage and support, if not formalize, the formation of employee discussion groups that can serve as sources of support and encouragement. Some of these discussions (e.g., “how to network”, “where to seek assistance when problems develop in the family”, etc.) might be led by HR personnel. It is important that, if this suggestion is undertaken, that it be led either by XXXX personnel (e.g., HR) or by facilitators known to the people in the organization.

(e). It is very important that, as employees leave the firm, that “going away” parties are encouraged, including leaving with a momento of some kind. Staff has in many instances spent many years of their adult life at XXXX – this has to be recognized, appreciated and remembered.

(f). If XXXX has been active in the community (e.g., sponsoring teams, supporting the local Chamber, etc.), how we take leave of these groups will be very important not only for the community itself but also for employees. If this is an issue, we should discuss it.

(3). FEELINGS & CONCERNS:

(a). We also will experience a range of emotions that need to be considered. For example, we might feel guilty even though we had little or no input into the decision to close the organization. There are a whole host of other reasons why we might feel guilty or depressed: “I might have done more to save the organization”, “I should have spoken up sooner”, “Who am I to have caused so much pain to others?”, etc. If we have been a manager in the organization and have been asked to remain, our reactions may be even more pronounced than those of others (a reaction termed “survivor’s guilt”). If we do experience it, we may find ourselves making decisions that we might later regret.

(b). Our reactions may vary from:

(i). An avoidance reaction, i.e., staying away from the “scene”, much like many people do when a friend or relative is dying.

(ii). Being over-involved and over-identified with employees, sympathizing with them to the extent that we begin to share with them anger at the firm.

(iii). Becoming depressed to the extent that our work is affected.

(iv). Working extra hard to avoid feeling guilty or depressed.

(v). Acting unduly “snippy”, angry and/or critical.

(c). If we are a “survivor”, i.e., we will continue to work at the XXXX Corporation after the downsizing, we face even more of a difficult situation. Not only do we have to deal with the feelings described above, but we may also have to deal with what’s been called “survivor’s guilt”. We will be working side by side with colleagues and staff who will be leaving and who usually know that we will be staying. A major concern that we may be feeling is, “Why me?” We may begin to wonder if we did something “wrong” (e.g., “sucking up”, doing too good a job at personal PR, too many friends higher up, etc.) or something “right” (“Maybe I was given too many opportunities to develop whereas they weren’t”, etc.). In either case, we may begin to question ourselves, our morality and ethics, how good a friend we really are, etc.

(4). RECOGNIZING THEIR FEELINGS:

(a). The accompanying chart plots the range of feelings that can be displayed among employees. Note that though the model is outlined as “stages”, the fact is that all the emotions can occur at any time. Also, be aware that each reminder of the organizational downsizing (e.g., either the different sections of the organization being closed at different times or individuals leaving at different times, the occurrence of either serving as a reminder) will re-open the “wound”. In general, even when we think that the employees have accepted the inevitability of the organization closing, these emotions will nevertheless spring out unexpectedly.

(b). Whom should we look out for? There are three major groupings of people, mostly male – the ones who turn into themselves and withdraw from others, the “mutterer” and those who are denying the situation.

(i). The “mutterers” are not outwardly vocal about their anger, but they are visibly seething inside. They tend in general to be suspicious and overly critical – in fact, paranoid. The organization closing is the final proof that they were right all along, that people have it in for them personally. Anything can set them off.

(ii). At the other extreme are those who tend generally to be quiet and shy – when their withdrawal into self becomes almost total (e.g., they don’t talk to anyone, they go about their work listlessly, they appear in a daze – but they don’t complain), their inner rage which has been tamped down as far as it can go can explode for apparently irrelevant reasons.
In both situations the “straw” is not important – the cause can appear innocent. The “mutterer” might experience any sign of criticism as further evidence – the shy withdrawn person might take someone too busy to talk to them as a sign they are being ignored and not important at all.

(iii). The people who are denying the experience all together are quite similar to the group of individuals described in (ii) above, except that they look as if nothing unusual has happened and they go about their business. The full impact only gradually hits them and then it hits them hard. Their despondency at that point is cause for concern.

(5). ADDITIONAL CONSIDERATIONS:

(a). The firm might publicize to employees on a regular basis what it is doing on behalf of those people being downsized. It might even include success stories in its newsletter, e.g., of how XXXX helped ex-employee Y find a job. This will help the survivors feel that the company is a caring company and does look out for its own.

(b). Any corporation needs to consider how to minimize future downsizings and organization closings. Many times over-hiring (particularly in third world countries) can initially be less expensive than investing in technology, organization re-design, outsourcing, etc. Since market turns are inevitable, this policy can and no doubt will lead to future downsizings. In some cases, no matter what consideration is given to this matter, downsizings will occur. However, other situations might be avoidable. Management might keep this in mind in plotting strategy.