During tough economic times, companies may be forced to make difficult decisions about staffing levels. However, layoffs can be detrimental to both employees and the organization as a whole and should be avoided if possible.
Instead, companies can explore strategies to prevent layoffs and increase job security for their staff. Below, 15 Forbes Human Resources Council members share some tips for companies that want to keep their teams together during tough economic times. Follow their recommendations to help minimize the impact of a downturn on your workforce.
1. Involve Staff In Decision Making
Companies should focus on their core purpose by involving their staff in decision-making. Companies can also shift their focus to training employees for higher-level skills instead of seeking outside hires. By putting people first, companies are better equipped to move forward during tough times without sacrificing job security or triggering mass layoffs. – Jennifer Patterson, Patterson Consulting Group
2. Build A Solid Foundation From The Start
Use a hire tough, manage easy approach to recruiting; cross-train employees and build interdepartmental collaboration into all jobs and projects. Implement and leverage technology to automate manual processes allowing for easy reallocations of people power. Always focus on process improvement and efficiency. This practice will allow you to run lean but never understaffed. – JacLyn Pagnotta, Rose Associates Inc.
3. Focus On Revenue
Speaking from a mid-sized firm background, a focus on revenue is pivotal for a company’s health and growth. Understand which individuals from supporting staff and non-revenue generating departments are interested in client-facing work, business development and marketing. Shift their capacity towards those goals. – Nick Frey, Avomind
4. Invest In Talent Management Strategies
Investing in the utility players can support an increase in job security through tough economies. This calls for HR to invest in their talent management strategies and call for talent reviews to support the employees that can they can support to reinforce the investments we have already made in our current talent. – Jessica Wallen, Wurl, LLC
5. Look At Other Ways to Save Money
Can some staff members move to part-time work? Would anyone be willing or interested in taking early retirement? Would anyone defer their salary? If your staff members volunteer for this, why not make changes that they want to save laying anyone off? Look at other ways to save money by shopping for benefits, negotiating contracts with vendors and minimizing travel expenses. – Erin ImHof, CertiK
6. Be Innovative
Determine whether your department could generate value by acting as a third party for other companies. Work with employees, be transparent and practical and provide their input. You may be surprised by your employee’s ideas for limiting costs. – Patricia Sharkey, Sharkey HR Consulting, LLC
7. Examine Budgets For Inefficiencies
Businesses should examine their budgets carefully for inefficiencies and create a plan of action to avoid layoffs. Alternatives to layoffs include staff furloughs, reductions in work hours, temporary pay cuts, voluntary short-term sabbaticals and short-term elimination of benefits or perks. While no budget reduction option is perfect, each of these alternatives cuts costs while preserving jobs. – Niki Jorgensen, Insperity
8. Hire Responsibly
The best remedy to the situation is preventative, and not reactive. Take time to invest in proper human capital forecasting to meet the needs of the business in the short and long term, so as to not overextend your resources. Providing a safe work environment, free from the fear of job loss can help your company survive and thrive in a tough economy. – Omar Alhadi, Adobe Care and Wellness
9. Explore New Models Of Employment
Explore new avenues and models of employment as terms of engagement have changed in today’s world. Layoff impacts both sides—employers pay the price with brand impact, and employees bear the financial and social brunt. The gig economy has opened a new hope and company association continuity until an employee stands back on their feet, acts as an immense help in dealing with odds and shows gratitude for employers. – Raj Tanwar, ADVANTAGE CLUB TECHNOLOGIES PRIVATE LIMITED
10. Use Temporary Or Flexible Hiring
Temporary (or flexible) hiring is an effective strategy to avoid overstuffing during strong markets. By hiring temporary staffers, a company gains access to extra resources when needed but retains greater flexibility when the market contracts, thus ensuring job security for the organization’s full-time employees. – Elisabetta Bartoloni, Heidrick & Struggles
11. Work Together
Transparency is key, and communicating with employees about the company’s financial situation and plans to mitigate any negative impact is a best practice. Working together and exploring alternative cost-cutting measures, including your team in the process and partnering with them reduces workplace anxiety, improves retention of top performers and keeps productivity high. – William Stonehouse, Crawford Thomas Recruiting
12. Hire The Right People
Hire humble and growth-hungry talent at entry points. Build a partnership that is focused on learning culture to ensure all feel a sense of belonging, growth, value and contribution to a purpose. Such a culture spends less on entitled people at mid-levels and above and more on training and education to grow grateful, motivated talent. You can pause training during downturns before needing to reduce headcount. – David Alsop, Ultradent Products, Inc.
13. Be Open And Honest With Employees
Increased revenue solves a lot of problems so do everything you can to that end. In the event revenue is slowing, ask employees to help reduce expenses. They will understand some costs are unavoidable, some are and those need to be eliminated. Freeze overtime, cut back perks and socialize reduced hours. Leadership matters, so start setting an example. – Gordon Pelosse, CompTIA, the Computing Technology Industry Association
14. Conduct Team Norm Exercises
During tough times, it can be wise to conduct exercises to establish what team normalities look like. Born out of agile methodology, team norms are a set of best practices to help shape team members’ roles, responsibilities and interactions with one another. They establish clear, agreed-upon roles and behaviors, and determine how the work will get done and the expectations. This is a key way to build trust, which is critical for team success. – Cat Colella-Graham
15. Identify Transferrable Skills
Assess the transferrable skills of staff in areas that are or will be underused in the changing environment and redeploy where possible to areas needing support. Be sure to identify where shifting resources could have the potential to damage organizational viability in the short- or long-term when redeploying. An up-to-date skills inventory can be an invaluable tool during this process. – Jennifer Rozon, McLean & Company
Successful HR executives from Forbes Human Resources Council offer leadership and management insights.
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