September 10, 2014

4 Win-Win Alternatives to Laying Off Staff

 Empty roll of toilet paper with the phrase Plan B, concept for alternative planning   Save Download Preview Empty roll of toilet paper with the phrase Plan Thank goodness we are coming out of the recession in most countries, but even in a growing economy companies can still falter. Microsoft announced 18,000 layoffs this year, which is the fourth biggest tech layoff in history. JP Morgan announced 8,000 layoffs earlier this year and Cisco announced recently that it’s laying off 8 percent of its workforce, which is 6,000 people.

Now, I don’t want to get too pessimistic as we are clearly in a growing economy, and so we’d hope to be seeing a net growth in all round employment opportunities, but the threat of layoffs is real and damaging to those at the eye of their own storm.

Traditionally, many employees have faced quite a blunt instrument approach when the spectre of layoffs emerge and they are often “let go” involuntarily, which can be bad for the employee and sometimes even bad for the company if it is forced to ditch top talent. However, there are other, sometimes equally effective, win-win alternatives to laying off staff, some of which I have outlined below.

1. Invite workers to work reduced hours. This is such a powerful alternative to layoff with huge potential because it addresses the growing desire amongst many workers to have a better work-life balance while at the same time reducing costs without there being a need to layoff staff. Many workers might appreciate a morning or afternoon off a week to spend time with their family, pursue a hobby or just relax.

2. Reduce or eliminate overtime working. Americans are on average working 47 hours a week, and with productivity dropping by a half after 40 hours, according to studies, this means that 47 hours of work correlates to about 43.5 hours of output. By reducing or eliminating overtime working you may be increasing efficiency, reducing costs and the need to layoff staff and improving work-life balance. It’s a big win-win alternative to layoffs.

3. Have an efficiency and revenue creation competition. Hold an efficiency and revenue creation competition, allowing your staff time to come up with ideas and initiatives to create efficiency savings and generate new revenues. The best ideas can be approved and implemented, which could lead to an improvement in your financial position, negating the need for layoffs. Some staff could in fact create new jobs for themselves in the process. This is another great win-win alternative to layoffs.

4. Let your staff become sales people to increase revenues. Are revenues falling or not rising fast enough, and is that a key reason for layoffs? Is this down to lack of qualified sales people? Are you therefore able to cross train willing staff from other areas, such as production or IT, and turn them into sales people to help boost revenues? This could be a great career development opportunity, and an alternative to laying off staff and a means to boost revenue. It’s a great win-win alternative to layoffs. (I remember a sales director suggested this to me when I was in HR and I just didn’t take it seriously and looking back I wish I had at least given it a go.)

Some of you may be wondering why I have left pay cuts off the list, and it’s because I don’t see this as a win-win alternative outright. Although the person keeps the job, trust may be damaged and engagement levels may fall as a result, which is clearly lose-lose.

So, if you do find yourself in the unenviable position of having to consider executing layoffs, at least take a moment to consider and embrace these four win-win alternatives.

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Kazim Ladimeji is a Chartered Member of the Chartered Institute of Personnel and Development, and has been a practicing HR professional for 14 years. Kazim is the Director of The Career Cafe: a resource for start-ups, small business and job seekers.