In 1995, the U.S. Department of Labor published its research about the effects on company performance of downsizing. Below are its guidelines, (many of which are apparent in Siemens Rolm’s restructuring approach) which have reaped success for both companies and their employees.
- Articulate a vision of what you want your organization to achieve.
- Establish a corporate culture that views people as assets to be developed rather than as costs to be cut.
- Be clear about your short- and long-range objectives; e.g., to cut costs (short-range) and to improve customer service and shareholder value through more effective use of assets (long-range).
- Establish an alternative menu of options for reaching the short- and long-range objectives.
- Get the people who will have to live with the changes involved in making them; provide opportunities for input at all levels.
- Communicate, communicate, communicate! Share as much information as possible about prospective changes with those who will be affected by them.
- Recognize that employees are unlikely to contribute creative, ingenious ways to cut costs if they think their own employment security will be jeopardized as a result.
- If cutting costs by cutting people is inevitable, establish a set of priorities for doing so (such as laying off outside contractors and temps first) and stick to it. Show by deed that full-time, value-adding employees will be the last to go.
- If employees must be let go, provide as much advance notice as possible, treat them with dignity and respect, and provide assistance to help them find new jobs.
- Consider retraining and redeploying surplus workers to promote their employment security and self-reliance and to protect your human resources investment.
- Give surviving employees a reason to stay. Explain what opportunities will be available to them.
- View restructuring as part of a process of continual improvement –with subgoals and measurable check points over time — rather than as a one-time event.
SOURCE: Guide to Responsible Restructuring, U.S. Department of Labor, Office of the American Workplace, 1995.
Personnel Journal, February 1996, Vol. 75, No. 2, pp. 58-69.