How to lead when working through layoffs

As an IT manager, one of your many jobs is to keep your team productive and its morale high through a layoff process. That, of course, is no easy task, so we asked tech leaders and career experts what you can do to ease fears and keep the remaining workforce productive.

leading through layoffs
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Workforce reductions have become commonplace as companies look for ways to decrease their costs and reallocate resources. In fact, BLS stats show that there were 1.7 million layoffs and discharges in December 2014. It's not an easy process for all parties involved -- the people leaving the job, the people still working and the managers who need to keep things moving forward. Layoffs send morale spiraling and many times they send employees heading for the door.

Most managers agree that layoffs are one of the most difficult workplace issues they deal with. In tech, with unemployment near 3 percent you may not think it's something you need to be concerned with, but money problems happen to even the largest of tech companies and when they do you can be sure that laying off employees is an option they consider.

Pamela Rucker, co-chair for Women in Leadership at the CIO Executive Council (a sister company of CIO.com) details one of her experiences working as an outsourcer to a company that was going through debilitating layoffs:

"It was so bad that we knew that when we showed up at work and there were police cars parked in the front, that people were being laid off that day. We just didn't know who would be going. Everyone's nerves were raw, and it became increasingly difficult to stay focused at work."

So what can you do as a manager to keep things on track and moving forward? Step 1 is to get as much information as you can before speaking to your people. You have to understand that your workers will have questions and although you may not be able to answer all of them either because you don't know or can't tell, you should have as much of the right information as possible to help quell rumors.

"I attempt to pause, to make sure I know what's happening and why. I speak up in leadership meetings and ask questions where necessary, especially the ones I think my team will want answers to. Having all the right information before you start to talk about it is key, since you don't want several different versions of the truth floating around that all contradict each other," Rucker says.

Rumors and speculation are sure to be afoot so sharing as much as you can will help put much of that to rest. "When I was a senior leader during layoffs, I saw how that same feeling of being demoralized was threatening to derail the team. There were lots of rumors circulating about who might be let go, what types of packages might be given, what packages wouldn't be given, and how tough the job market was in the city. It seemed to be all that people talked about," says Rucker.

Be as Transparent as You Can

Experts agree that communication is paramount to allaying fears and keeping employees focused. "The first and most crucial action is open and honest communication with your team. In order to lead effectively you have to be trusted by your team. Share as much information as you can and allow your team to ask questions. This will stop the corporate rumor mill in its tracks and allow you to take control over the message that inevitably comes out regarding the layoffs," says Matt Brosseau, CTO and head recruiter at IT staffing and recruiting firm Instant Alliance.

Once you are armed with the right information, it's time to address your workers. According to Brosseau, you should meet with your entire team to discuss the issue. "Typically one, roundtable-style discussion the week following the layoffs should be enough," says Brousseau. However, managers should expect follow-up questions and be prepared to meet with people one-on-one to discuss these.

Typical Questions

So what kind of questions can you expect? We asked our experts and they agree that the first questions is normally "Why?". "You have to handle this one carefully," says Brousseau, "It's often best to talk about the long-term strategy of the company and the reinvestment of the cost from that department and how that will benefit the company as a whole."

Here are some other typical questions as well how you should approach the answer, according to Rucker.

  • Q: Are more layoffs coming?
    A: Tell the truth, if you know it and you're able to share it.
  • Q: Why did you pick that person? They were responsible for a lot, and now we have critical projects at risk.
    A: There's no error-proof way to decide which member of the team you'll lose. Even though you value everyone, and try to do your best to minimize impact, sometimes you will still see gaps when you have to let people go.
  • Q: I heard that we could have saved money without doing layoffs. Why did we go this route?
    A: One of the challenges with the rumor mill is that it's hard to talk about all the information you have and what led you to the decisions you made. While you can't share everything you know, you can assure team members that you agonized over the best ways to make the cuts that you needed to make, and came to the conclusion that this was the best course of action.
  • Q: I heard that we're doing fine financially. Why are we laying off people?
    A: There are times when you've grown too much or too fast as an organization, and in order to keep the innovation you need in the marketplace, or in order to aggressively compete in the industry, you have to get lean. These types of layoffs aren't so much about responding to bad times, as they are done to help you prepare for the good times you're hoping to see down the road.

Keeping Employees Engaged

According to Rucker, instead of treating this situation as a "wait and see what happens" type of moment, IT leaders should be proactive. Consider how things will change and look for opportunities to reshape how things are done. "For me, this isn't a time to sit back and wait for things to happen to us, but for us to look at how things will change, and what we'll do to change with them. The process of change itself is a challenge, and can present many opportunities for you to talk about other things with your staff outside of the fallout from the layoff process."

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