Lately, many companies are in deep financial doo-doo. Some have addressed this issue by downsizing. Basically, they fire a lot of people. Often this tactic is so harmful to the company that customers, shareholders, and employees wonder whether management is actually trying to hurt the company.
Is that really possible? To evaluate the performance of your company's Chief Downsizing Officer (CDO), use this handy checklist for executives who really want to ruin their companies in an effective manner.
- Be sneaky
- Don't let on that you're about to fire 20% of your employees. Giving people a heads up just lets them avoid major purchases and warn their families.
- Maintain executive compensation
- Don't reduce executive compensation at all. If possible, increase it. This builds resentment among employees, insecurity among customers, and fury among shareholders.
- Don't downsize enough
- Maintaining or increasing
during a time of cost
reduction and layoffs
is a great way to
- Make sure that you'll have to downsize again. Doing it twice in quick succession puts everyone on edge permanently.
- Announce rolling layoffs
- Tell everyone you plan monthly reductions for the foreseeable future, because rolling layoffs could reduce the total number of people affected, assuming conditions improve. But you know what will really happen — people will believe that every month is their last.
- Schedule the announcement for December 24th
- In Europe, Australia, and the Americas, the optimum time for downsizing announcements is just before Christmas. That way, people will already have spent more money than they would have if only they had known. No point hurting the economy too.
- Don't solicit volunteers
- Some people actually want to leave — they would prefer a layoff to quitting. Don't lay off people who want to leave, while you keep people who want to stay. You can do more damage if you lay off people who want to stay, while you keep people who want to leave.
- Offer early retirement
- Early retirement programs offer a relatively safe way to jettison your most valuable and experienced people first, without the legal risks of laying somebody off one week before they become eligible for retirement.
- Don't close unprofitable operations
- Keep them running. They'll probably lose even more money with only 80% of their staff. Instead, close or spin off any profitable operations, assuming you have any.
- Don't cancel any initiatives
- Internal initiatives, especially those with only long-term benefits, should remain at high priority. If you must cancel something, cancel anything that might immediately cut expenses or shorten the sales cycle.
- Hint that there might be more
- In media interviews, when asked if these cuts are the last, squirm. This signals the employees who have alternatives — who are, of course, the most difficult to replace — to get moving on job searches.
Are your projects always (or almost always) late and over budget? Are your project teams plagued by turnover, burnout, and high defect rates? Turn your culture around. Read 52 Tips for Leaders of Project-Oriented Organizations, filled with tips and techniques for organizational leaders. Order Now!
Your comments are welcomeWould you like to see your comments posted here? rbrenmhXARWRMUvVyOdHlner@ChacxgDmtwOKrxnripPCoCanyon.comSend me your comments by email, or by Web form.
About Point Lookout
Thank you for reading this article. I hope you enjoyed it and found it useful, and that you'll consider recommending it to a friend.
Support Point Lookout by joining the Friends of Point Lookout, as an individual or as an organization.
Do you face a complex interpersonal situation? Send it in, anonymously if you like, and I'll give you my two cents.
More articles on Personal, Team, and Organizational Effectiveness:
- Take Any Seat: I
- When you attend a meeting, how do you choose your seat? Whether you chair or not, where you sit helps
to determine your effectiveness and your stature during the meeting. Here are some tips for choosing
your seat strategically.
- Films Not About Project Teams: II
- Here's Part II of a list of films and videos about project teams that weren't necessarily meant to be
about project teams. Most are available to borrow from the public library, and all are great fun.
- Recalcitrant Collaborators
- Much of the work we do happens outside the context of a team. We collaborate with people in other departments,
other divisions, and other companies. When these collaborators are reluctant, resistive, or recalcitrant,
what can we do?
- Symbolic Self-Completion and Projects
- The theory of symbolic self-completion holds that to define themselves, humans sometimes assert indicators
of achievement that either they do not have, or that do not mean what they seem to mean. This behavior
has consequences for managing project-oriented organizations.
- The Risks of Too Many Projects: I
- Some organizations try to run too many development projects at once. Whether developing new offerings,
or working to improve the organization itself, taking on too many projects can defocus the organization
and depress performance.
Forthcoming issues of Point Lookout
- Coming January 22: Disjoint Awareness: Bias
- Some cognitive biases can cause people in collaborations to have inaccurate understandings of what each other is doing. Confirmation bias and self-serving bias are two examples of cognitive biases that can contribute to disjoint awareness in some situations. Available here and by RSS on January 22.
- And on January 29: Higher-Velocity Problem Definition
- Typical approaches to shortening time-to-market for new products usually involve accelerating problem solving. Accelerating problem definition can also help. Available here and by RSS on January 29.
I offer email and telephone coaching at both corporate and individual rates. Contact Rick for details at rbrenmhXARWRMUvVyOdHlner@ChacxgDmtwOKrxnripPCoCanyon.com or (650) 787-6475, or toll-free in the continental US at (866) 378-5470.
Get the ebook!
Past issues of Point Lookout are available in six ebooks:
- Get 2001-2 in Geese Don't Land on Twigs (PDF, )
- Get 2003-4 in Why Dogs Wag (PDF, )
- Get 2005-6 in Loopy Things We Do (PDF, )
- Get 2007-8 in Things We Believe That Maybe Aren't So True (PDF, )
- Get 2009-10 in The Questions Not Asked (PDF, )
- Get all of the first twelve years (2001-2012) in The Collected Issues of Point Lookout (PDF, )
Are you a writer, editor or publisher on deadline? Are you looking for an article that will get people talking and get compliments flying your way? You can have 500 words in your inbox in one hour. License any article from this Web site. More info
- The Power Affect: How We Express Our Personal Power
Many people who possess real organizational power have a characteristic demeanor. It's the way they project their presence. I call this the power affect. Some people — call them power pretenders — adopt the power affect well before they attain significant organizational power. Unfortunately for their colleagues, and for their organizations, power pretenders can attain organizational power out of proportion to their merit or abilities. Understanding the power affect is therefore important for anyone who aims to attain power, or anyone who works with power pretenders. Read more about this program.
- Your stuff is brilliant! Thank you!
- You and Scott Adams both secretly work here, right?
- I really enjoy my weekly newsletters. I appreciate the quick read.
- A sort of Dr. Phil for Management!
- …extremely accurate, inspiring and applicable to day-to-day … invaluable.