Let's Talk About Lay-Offs

Seeing this headline really hit me hard:

Meta, Amazon surge by $270bn as cost cuts cheer investors

If we live in a world where the headlines are "cost cuts cheer investors" - so people are CHEERING when other people have lost their jobs [that are the bulk of said cost cuts], then something has gone very, very wrong.

Let me be clear up front.? I do not believe that layoffs should NEVER happen.? But I do believe that they should definitely happen way, way, way (way) less.? It seems as though every day there is a news headline, LinkedIn post or email bulletin announcing the latest org with its round of workforce reductions.? In the tech space alone, this is translating into approximately 1,200 people that lose their jobs EVERY. SINGLE. DAY.? So every day, 1,200 humans find their whole world shaken up, and IMHO that could be, and should be, not the case.

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When have we gotten so commoditized that we treat people as disposable items that can be hired and fired on a whim?? When have we gotten so detached from the humanity of it all that we can say (and I have heard people literally say this) “oh, it’s JUST a job, it’s not like it’s life or death!" or "no big deal, they will find a new job.”? As if we can now infer what people’s jobs mean to them and de-value it so readily!!!? For many, a job is not just a job.? It is something that most of us spend a large part of our lives doing, derive a significant part of our purpose and meaning from, and even ENJOY doing (except on Monday mornings pre-coffee).? So, when that is taken away suddenly, it can be life-changing.? It can be demoralizing.? It can be destabilizing. ?It can really hurt.

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As someone who has been on both sides of the table, I can honestly say lay-offs SUCK!? As the lay-off-ee (what IS the word for this?!?!) it can’t help but feel personal.? I was 7-months pregnant when I was brought into the windowless room by a somber colleague holding a manila folder.? Naturally, I was assured up front that it wasn’t because I was pregnant and back in the office between two periods of maternity leave.? That it was not about me, but about my role and how it structurally fit in the org.? That it was happening to many, many others this week also. ?Ummm . . . Yeah thanks, that makes me feel SO much better.

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On the other side of the table (lay-off-er? Anyone? Help?) I have been in positions where I have been told I have to let people in my team go due to corporate “restructures” [a.k.a. “cost-cuts”] where I had zero influence in the matter.? I have also been a business owner where I have had to make those tough decisions and have those VERY tough conversations. ?Sometimes sh*t happens. ?And it is sh*t we could never have seen coming (COVID anyone?). ?But what I will say, is that in the latter case, we tried our absolute darndest to make sure that the decisions were not made lightly and reactively.? Scenario planning was conducted looking at possible trajectories and alternatives, both in the short and longer terms. Consideration was given to re-deployment and re-skilling possibilities, retaining where possible for a likely bounce-back or could be augmented elsewhere.? And lay-offs as a balanced, responsive and last-option when there really were no other alternatives.

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Unfortunately, that is often not the case at all for most lay-offs.? They are reactive and almost seen as a “normal” lever that can be pulled as and when needed.? Someone just this week told me that lay-offs are considered such a regular business practice in their org that people no longer bother to bring in anything personal to the office since they may not be there long enough anyway (and it is not because it is a hybrid workplace). ?Employees rush to use up all of their sick leave entitlements like some sort of amazing race gone wrong with a “use it or lose it” mentality. ?Colleagues have stopped turning up to new-starter welcome events or departing colleagues farewells as “it’s too often so what’s the point!” ?[And yes, this person is looking for a new job with an org that doesn’t view its people as expendable.]

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You see, the majority of lay-offs that do make the headlines are driven by purely financial imperatives.? Look, I get it.? I started my career in Finance as a Chartered Accountant (don’t judge ??) and the workforce was absolutely viewed as just another cost line in the P&L.? And we gotta get those costs down!!!? That is something that is the very fabric, the raison d’etre of most finance functions – costs down, revenue up.? Slim chances if we would consider that there are humans that make up that cost line.? And ozempic-slim chances if we would consider that those humans are actually assets, with skills and capabilities, that are creating value for our organization.

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Prioritizing short-term financials over people is widely considered a “recipe for disaster”.? Indeed, how often do we see organizations make those short-term, reactive, knee-jerk decisions involving their workforce, that not only destroy the very things HR professes to care about the most - culture, engagement, EX - but also damages the orgs own productivity and viability! Customers left-unserved, revenue literally walking out the door. And those customers can be VERY hard to win back! Grab a coffee with me and I can share countless examples where I have seen orgs start to really commit to their people - building great cultures, investing heavily in engagement and measures of organizational health over a number of years.?

But then something happens that creates pressure and right on cue: React! ?Cost cuts and sweeping workforce redundancies masked as well-thought-through “restructures.” ?

Overnight, people become distraught and fearful in an uncertain future, not knowing if they have a job. ?Trust and collaboration go out the window. Productivity plummets, highly-sought skills walk out the door (instantly finding a new, happier home – easy!) and discretionary effort? ?As If!? Below the bare minimum is the new level of output amidst the distraction and distress.? This then takes years to rebuild, until the next “unknown” and - spoiler alert - the cycle starts again!

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Shocks and surprises are not new, are never going to never happen.? A couple of decades ago where I worked, we called it “constant shock syndrome” as it felt like it was non-stop disruption, but I think we all feel that the rate and pace of change has never been greater than it is right now.? However, we don’t have to be such “victims” to forces unseen.? Things can be done differently now.? Through scenario planning our orgs are able to lift their gaze and gain insight into how the multitude of variables (internal and external) may impact their business trajectories so they can become proactive, rather than reactive.? Know where we are heading and, as things invariably change, be able to shift our sails and course-correct.?

We are able to see beyond today, so that we can make better decisions for tomorrow.

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Fundamentally, this is about driving what is, IMHO, THE most important conversation a company can have – what are we trying to achieve and how will we achieve it? ?Recognizing that the way to achieve it is through our people – the ones doing the work, interacting with our customer, innovating and creating.

The orgs that do this create a win-win, rather than the default where something or someone has to always lose.?

Through looking at the future, aligning on the path, having the shared view, they are able to effectively have it all!? They can realize business enablement, execution of strategic, transformation and operating imperatives, commercial optimization and risk mitigation.? And be good humans.

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But orgs MUST MUST MUST move beyond the MO ie. those short-term, old-school, reactive means that destroy longer term viability . . .

• Hiring freezes
• Blanket % headcount reductions
• Org Restructures that used to occur annually, quarterly, monthly but are now permanent
• A more recent phenomenon according to Josh Bersin – over-hiring rather than hiring responsibly and sustainably

Not only do these measures undermine the very premise of “social responsibility” but they demonstrate a clear failure or the org to understand what workforce is needed to deliver their imperatives.? They have no way of knowing if they have the right workforce before, during or after all of this.? That kind of approach is never going to give you the longevity, success and sustainability in your business that you are ultimately trying to obtain. ?

Goodbye workforce and cost today.? Hello skill-gaps, failed transformation initiatives, disgruntled customers and missed revenue targets tomorrow.?

Well done you ??

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Which is why it is of no surprise to see endless cycles of these same measures, because those measures in and of themselves can never address the fundamental disconnect between what the org is trying to achieve and what is needed to achieve it. ?Those measures alone have never truly connected the orgs value-chain, activities, objectives to a clear view on the requisite workforce size, shape and skills. ?The organizations in these cycles still can never answer what workforce is needed today and also provide a view on how that needs to shape and shift to deliver changing business needs tomorrow, thereby future-proofing the organization. Trust me, I ask them all the time.? [insert shameless plug for #strategicworkforceplanning which solves this]

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Mis-hiring and firing.? Mis-firing and re-hiring. Where does that really get you?

Furthermore, because the organization has failed to holistically create a clear plan for the future, they?have been unable to ensure what is, arguably, the greatest measure of responsibility for their people – sustainability in employment, either with or without them. ?Your people are the community, are society, are the “social” for which we must be “responsible”. ?Yes, you may have shifting workforce requirements – but imagine you could let employees know well in advance, help them prepare for transition in a compassionate and honest way, over time rather than over night! ??Or even better - identify that they actually have 60/70/80% of the capability you need in a growing/emerging role and bring them on the upskilling/reskilling revolution with you! ?These are people that fit your orgs culture, DNA and have bought-in to being a part of it - why on earth would you squander that so readily?

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Lay-offs are the default option to orgs who are too lazy and reactive to do better. ?To think differently. ?It is for those who have lost sight of humanity and what it means to be an employer. Who focus singularly on the bottom line. Organizations need to fundamentally understand that the workforce IS their organization and that messing around with your people can be irreparably damaging to both.? That you cannot get where you need to go, you cannot achieve what you need to achieve without your people. ?And if an organization thinks that lay-offs are just a part of their standard toolkit rather than a last-resort after all other options have been well exhausted, I think that is demonstrative of what they think of humans. ?It makes me not want to be their customer and definitely doubtful of the security, conditions and treatment offered in that job advertised by Meta . . . but don’t worry, Zuckerberg got $700m in his pocket, so really it’s all good and we are cheering ??