How to trim a workforce
It is rarely a pleasant experience, but cutting staff is an inevitable part of human resources. Handled properly, downsizing can save a company money. If mismanaged, it costs more. So how should it be done?
List all of the activities for which your organization is responsible. This should include both revenue-generating and cost line items. Once you have a complete list of activities, rank them in order of importance. The most important activities would be those that, if you stopped doing them, would mean your organization would not be able to achieve its mission, now or in the future. What is the vision of your organization? What are your strategic objectives?
List all of your organization’s positions. Focus on positions, not people. Which are most critical to your organization? Remember it is the role, not the incumbent in the job, you are assessing. Rank every position from most critical to least critical. This does not necessarily align with compensation.
Reflect back on the two lists. Given the tasks that you need to accomplish, what positions do you need? How many positions need to be dropped? Which outputs? Draw a line on your list of activities to indicate what needs to be dropped to achieve the desired savings.
Even in unionized environments, consider performance. With a strategic mind focused on value to the organization, now and in the future, put your employees into three groups: those whom you must keep, those whom you would like to keep, and those with whom you could survive without.
Go back to your list of positions. Do you have employees you placed in the “survive without” category that are in your critical roles? Or are your “must keep” employees in jobs you plan to cut? What would it take to align people and positions? Come up with a single list of people and positions that could be downsized.
If you are in a unionized environment, look at your collective agreement. Collective agreements rarely, if ever, restrict the employer’s ability to organize the operation, so the reduction of positions is usually not limited. It likely does cover what happens to those employees affected by the cutting of positions. Is there bumping? Severance entitlements? Requirement for union consultation? Are you able to downsize using discretion or must you do it by seniority? Read and reread the collective agreement to understand the process you are required to follow.
Brainstorm. You must follow the collective agreement. You must achieve the dictated savings. How can the organization be structured to do this? Explore all options.
You need a communication strategy. When are you going to implement this plan? How are you going to communicate it? To whom? When? Who is delivering the message? How are you going to support the people who are being downsized? How will you support the people who stay?
Implement and monitor. Are you achieving your desired outcome? If not, go back to your plan and make adjustments. Susan Haywood is president of Human Resource Blueprints and a board member of the Ottawa chapter of the Human Resources Professionals Association.