When Lawrence Stuenkel founded his outplacement firm in 1977, those first few sales calls were painful. Not only did his service require some explaining, stunned business owners occasionally laughed at him as they turned him down.
“I remember one fellow from a major corporation telling me, ‘Now let me get this straight, we fire somebody, pay them too much severance, and you want us to pay you more money to help find them a job?'” Stuenkel says. “I said, ‘You understand the concept perfectly.”
Revenge is sweet. Today, many companies large and small hire outplacement firms like Lawrence & Allen in Chicago to assist with downsizing and restructuring.
“No two downsizing situations are exactly alike,” Stuenkel says. “That’s why it pays to bring in an objective third party who really knows the ropes. Besides helping your company keep everything legal, he or she can be on site to help shell-shocked, released employees begin their transition plans.”
After years of helping terminated employees find a new career, Stuenkel wrote a guide which covers all aspects of unemployment, job hunting and salary negotiation. The guide, “From Here To There: A Self-Paced Program for Transition in Employment,” was originally just for his clients. It’s now in its fourth edition.
“There were books on resume writing and there were books on interviewing, but there really wasn’t a complete guide from filing for unemployment to whether you should do temp work — the whole nine yards,” explains Stuenkel.
The book is a meticulous guide for job hunters, but Stuenkel could also write a volume about how to properly shrink your work force. His 20-employee firm has been quite busy lately with new projects, prompting him to add an office outside Chicago.
“I think we saw this in the early 1990s,” Stuenkel says. “But the lessons of this downturn will not long be forgotten, just as I think we learned from the last one.”
Stuenkel suggests the following for employers considering cutting back their work force.
Don’t try to keep secrets
Employees know how many shipments are going out, if sales are dropping and if things are changing. As soon as possible, communicate with all employees that the company is facing difficulties and evaluating methods to handle the problem. Then, decisions to downsize will come as no great surprise. It is one means of maintaining credibility.
Get important information on paper
Have human resources prepare a full written explanation of benefits, including profit-sharing, vested pension rights, stock options, bonus arrangements, medical insurance continuation and unused sick days. People are not in the right frame of mind to understand benefits during a time of separation. Be clear that this is a lot of information and they are not expected to grasp it all, but you are available to talk any time to review it.
“Anything you say after that communication is probably going to be lost,” Stuenkel says. “I’m just not hearing you, I’m thinking about the mortgage, the car payment, the tuition, and you don’t want to hear somebody go on and on about salary continuation and medical benefits.”
Plan separation meetings carefully
Separation meetings should take place as early in the week as possible. People are fresher and psychologically stronger in the morning and better able to absorb the impact of a termination than if they are confronted at the end of a hectic day or week. The meeting should be one-on-one and in a closed-door environment.
Be certain to give the same reasons to each employee because they will compare notes. Talks with affected employees should be kept brief. It’s not the time for discussion or debate. Most managers or supervisors do not effectively plan what they’re going to say, and the meeting runs much too long. To end the meeting, simply stand up. This physical action will end all communication.
Details are important
Company property such as keys, credit cards, etc., should be collected during the separation meeting. Computer passwords, especially for IS employees, should be changed immediately.
“It might seem a little contradictory, but keep in mind, if you were going to give somebody your computer PIN number for your bank account and fired them, would you wait a week to two weeks before you cancelled it? Probably not,” Stuenkel says. “The chances of something happening are just too great.”
Be aware vendors can spread misinformation
Don’t forget to arrange for a transition call with vendors, who can be a source of negative rumors if not informed appropriately.
Think about the small things
Make sure affected employees have transportation home. To avoid potential embarrassment, suggest they clean out their desks, with prior arrangements, in the early evening or on Saturday.
“If they have a laptop computer, maybe they would want to buy it from the company to help with their job campaign,” Stuenkel says. “Think of the things that you wouldn’t think about when you have just been terminated.”
Don’t make promises to existing employees
Phrases such as “There will be no more cuts,” or “All organizational changes are in place,” are seldom true. When further changes are required, employees will recall these statements, and management will lose credibility.
Don’t get caught with your face in the mud
Check to see if any affected individuals are due to receive sales awards, service awards or other forms of recognition. You don’t want to be laying someone off the day a recognition memo is sent companywide.
The truth is always best
Even if your organization is small, be prepared for media inquires. Local press will want to cover the reduction, and you should have a statement prepared explaining the reasons for downsizing.
Appoint a high-level press officer to speak in one clear voice to handle inquiries from the media. Distribute this person’s name to receptionists and supervisors.
“Make sure the door is left open,” Stuenkel says. “Think through these things because a lot of these people that you’re releasing today, six months from now, you may want to rehire. Business conditions change, but don’t guarantee you’ll be back in touch with them.”
How to reach: “From Here To There: A Self-Paced Program for Transition in Employment,” by Lawrence Stuenkel. Lawrence & Allen Press, (864) 240-3000. $29.95