Coming out the other side…Managing the Risk

You will be restructuring your business.

And sadly, people will be losing their jobs.

Did you know there are best practice approaches to managing your business ‘through and out the other side’ of that?

During one of my earliest jobs I ‘ghost wrote’ Bell Gully’s contribution to CCH’s text on the then new Employment Contracts Act - since replaced by the Employment Relations Act 2000 - (I was a mere Solicitor; the named author was a Partner…).

Shortly after that, my work as a Consultant involved a lot of business restructuring as businesses continued adapt post the ’84 economic reforms and the ’87 share market crash.

I did a lot of work looking into ‘best practice’ approaches to restructuring from the organisational culture perspective, and discovered that the required approach to consultation under the law as applied by the Courts coincided quite closely with what Organisation Development theory developed from the research recommended if you wanted the best possible outcome for your business.

So, I put together a process for approaching restructuring combining the New Zealand legal requirements and those steps recommended as Best Practice out of the research data.

And, although aspects of the requirement to consult have continued to evolve, the key elements to leading people 'out the other side' of such change still hold true.

I thought now would be a good time to revisit the background to this, and have found an article which covers most of it rather well. The article is by Boston Consulting Group and can be found at:

file:///C:/Users/User/Documents/Business%20Organics%20Limited/survivor%20syndrome.pdf

In short, what the research shows is:

➢ layoffs hinder the workplace performance of survivors (the people who get to stay). If not managed properly, they will suffer from what is known as “survivors’ guilt” … ➢ if employees believe that their company is laying off people only to cut costs, they are more likely to suffer survivors’ guilt as well as lower performance and engagement… ➢ but – if they believe the employer is fundamentally reshaping the company for future stability and success while treating people with dignity, they will likely reward the organisation with their best efforts (of course cost is a driver – but that is no excuse for not developing a vision for what happens next…)

and that Best Practice in managing for this involves:

1. articulating a vision for the new work environment 2. using a fair, merit-based approach to selection of who stays and who goes

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[these first two steps are of course very similar to what you would do complying with the consultation requirements of NZ Employment law. The key is engaging the workforce in the issues, the vision and the pathway]

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3. ensuring that all the management team at all levels are fully engaged in the pogramme

4. ensuring the survivors are involved in ‘building’ the new company 5. Communicate – Communicate – Communicate! 6. measuring and managing engagement, and drive momentum using objective measures against the new goals (focus on future rather than wallowing in the past).

But, with the isolation requirements of New Zealand’s approach to the Covid – 19 outbreak, it will be impossible for some businesses to manage the first steps in this process in other than a rudimentary way – except for communication!

So, the emphasis will fall even harder on the effectiveness of setting and leading for the ‘new normal’ – points 3 – 6 above must be done right.

This is all a rather high-level summary of what needs to be a well-managed and authentic process – but hopefully it works as a prompt…call if you want to know more.