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Michael Useem
Scholar

Michael Useem

Michael Useem is Professor of Management and Director of the Center for Leadership and Change Management at the Wharton School of the University of Pennsylvania.

Fire Yourself

"Organizational downsizing" is one of the most detested phrases in the management vocabulary. Many managers say that the one action they hate more than anything else is letting somebody go, and downsizing entails letting dozens, sometimes thousands go.

For those on the receiving end, aside from the immediate loss of income, health care, and work identity, the dreaded pink slip can foreshadow personal anguish, family stress, and the decline or even end of a work career. This is especially true when widespread hiring freezes and mass dismissals leave few employment alternatives.

For those who unfortunately must lead the downsizing process, research from prior recessions point to the value of imagining they themselves may be riffed (a verb from the acronym, RIF, or "reduction in force"). From this not so imaginary perspective -- those engineering a first round of layoffs are sometimes the victims of a second round -- here are four simple implications:

1. Look for ways to minimize the downsizing as much as possible. Organizations have employed a host of measures to do so, including wage reductions and work furloughs.

2. Disclose as much detailed information as possible. Employees hate an information vacuum when their work lives depend on it as much as nature abhors a vacuum.

3. Provide as many forms of personal support as possible. These range from employment counseling and placement services to the temporary extensions of medical and dental benefits.

4. Avoid repeated rounds of layoffs if possible. To be recurrently subjected to the threat of dismissal is to undergo a work version of water torture.

Such steps are essential both for those let go as well as for those who survive. The latter must still get the job done, and their willingness to do so depends on the respect that remains for those who have led the downsizing. If the leaders' actions are perceived as unavoidable, fair, and taken in ways that minimize the human toll, employee faith in them can constitute foundation for the next and very demanding step of turning around the enterprise.

Here's how not to do it. One manufacturing firm in a prior recession sent a manager around the shop floor late in the afternoon to tap employees on the shoulder and then walk them to a nearby room. There, the downsizing victims learned of their fate, and minutes later they were ushered out another door directly onto the street, with little more than a promise that their personal effects would be mailed. Knowing that a tap on the shoulder presaged such a fate, some employees took to hiding in the restrooms late in the day, an understandable if unsuccessful expression of the dread that downsizing strikes in all.

By Michael Useem

 |  February 9, 2009; 12:28 PM ET
Category:  Economic crisis Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
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