What Companies Still Get Wrong About Layoffs

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Today it’s difficult to read the news without seeing an announcement of layoffs. Just this week, Morgan Stanley announced it will reduce its workforce by 2%, Buzzfeed said it would cut headcount by 12%, and PepsiCo said it plans to cut “hundreds” of jobs. The same is true at Redfin (13%), Lyft (13%), Stripe (14%), Snap (20%), Opendoor (18%), Meta (13%), and Twitter (50%). So many companies have initiated layoffs recently that tech and HR entrepreneurs launched trackers like TrueUp Tech and to Layoffs.fyi dedicated to monitoring the staff reductions across the tech sector.

Traditionally, employers resort to layoffs during recessions to save money. Companies continue to cling to the idea that reducing staff will provide the best, fastest, or easiest solution to financial problems.

As if layoffs aren’t painful enough, many companies make matters worse by handling them poorly. Handling layoffs in a humane way is important for the morale of both the impacted and retained employees, it will impact the company’s ability to hire strong talent later, it affects litigation risk (people who feel mistreated are more likely to sue), and, of course, it’s the right thing to do.

Layoff Myths and Mirages

Contrary to popular belief, there’s not much evidence that layoffs are a cure for weak profits, or, to use the current euphemism, that they reposition a firm for growth going forward.  It’s very difficult to sort out the relationship because firms that are laying off are almost by definition in trouble. The research evidence has not found any support for the overall idea that layoffs help firm performance. There is more support for the idea that where there is overcapacity, such as a market downturn, layoffs help firms. There is no evidence that cutting to improve profitability helps beyond the immediate, short-term accounting bump.

Employers also often underestimate the cost of layoffs in immediate financial terms, as well as in the lingering burden it places on remaining resources — both financially and emotionally. There is a huge problem in HR generally that the stuff that is easy to put on a spreadsheet outweighs the stuff that isn’t.

The toll of layoffs is high. In many industries, layoffs beget lower productivity and profits. When sales are slow, for instance, many retailers cut staff. But several studies show a correlation between bigger staffing and substantially higher sales.

Layoffs destroy trust

Eighty-five percent of respondents rated job loss as their top concern in Edelman’s 2022 Trust Barometer. Layoffs break trust by severing the connection between effort and reward. The premise of a layoff is that if it weren’t for the economic conditions facing the firm, employees would keep their jobs as long as they perform them well.

The fact that this is a psychological contract rather than in most cases a legal one is beside the point. In the domain of trust, what matters is that employees are being asked to willingly be vulnerable to the power their company has as an employer, and trust that the company will act in ways that don’t violate their trust. Research finds that, once betrayed, this trust is hard to recover.

Forgetting to be human

In the process of trying to do everything “right,” some managers forget to be human. It’s amazing how often people rigidly follow a script during notification meetings for fear of saying something wrong. It’s even more amazing how often they forget to mention the niceties, like the fact that they appreciate everything the employee did for the team or affirmation of the employee’s abilities. Layoffs are emotional and raw; it’s critical to show empathy when delivering such painful and often scary news.

It’s also critical to help employees maintain their dignity. That’s why having a security guard escort the employee out the door should be avoided, except in the rare cases where it’s truly needed.

Failing to plan ahead

Founders and executives at high-growth companies are often caught unprepared for layoffs. Many assume the only possible direction is up. With pressure to grow, it’s easy to hire too many people too fast, and later need to lay off employees quickly. And, even under conditions of sustained growth, layoffs can become necessary due to acquisitions.

Successfully managing workforce changes within today’s landscape ultimately requires evaluating your actions against the backdrop of trust. Your company will weather the storm of layoffs more successfully if you can maintain trust with three groups who will determine your success in the future: employees you let go, employees you retain, and employees who don’t yet work for you.

You have a great opportunity to be better at this than other companies. Keeping trust at the centre of your decision-making can lead to surprising, beat-the-odds success, as the above examples from Honeywell and Nokia show. Centring trust also offers leaders a reminder: Your actions will have consequences that are more visible than they’ve been in the past and you will be judged as trustworthy — or not — based on them.

Given our current situation knowing that your colleagues or employees are best suited for this new scenario we find ourselves in. Finding the right talent, the best fit for the job and your organisation can be a very challenging task. It is now important to find out whether your managers or your team is well-equipped of working together from various locations. It requires deep knowledge of their personalities, strengths, weaknesses, interests, work style and other characteristics. Our technology and solutions will do the work for you, helping you discover if your people are resilient during times of hardship, if they are autonomous, if they are team players, without actual human contact. Given that our platform is cloud-based, everyone can use it from home as well. Humanity finds itself at a crossroad for various reasons now, why not help people discover and develop themselves from the comfort of their own homes?

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Sources:

https://hbr.org/2022/12/what-companies-still-get-wrong-about-layoffs
https://www.entrepreneur.com/leadership/the-7-worst-mistakes-companies-make-when-laying-off/307308
https://knowledge.wharton.upenn.edu/article/how-layoffs-cost-companies/

Recruiting Top Talent – A Hidden Gem during the Pandemic?

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Many potential new hires who have applied for, been interviewed for, or even been offered a new position are now in limbo. Due to the COVID-19 pandemic and the start of social distancing, self-isolating and the majority of people working from home, recruiting and hiring at this time and even afterwards, will pose its own challenges. The steps that HR departments or hiring managers have to take in order to avoid losing out on top talent and boosting their employer brand will determine the future of most businesses post coronavirus outbreak.

Will this outbreak turn the remote workforce into the new reality we all sensed it could become? Should hiring managers and employers invest in top of the line digital interviewing tools? Are they using their time in lockdown to create a unique business advantage? Even though this is an unpredictable and overwhelming time, it could very well be the perfect time to dust off ideas that would normally take a lot of time to put into practice or simply open the mind to new and exciting ideas.  At the same time, there’s never been a better time to assess your organisation to help you to prepare for life after COVID-19, including the people within it.

Recruitment is a topic many businesses are not even thinking about right now, and it’s even more difficult to plan which roles you’ll be ready to fill when the pandemic is over. However, there is a way you can ensure that when you can hire, the best people are ready and waiting.

Building a pool of suitable candidates interested in working for you, can be done through smart recruitment marketing, social media and digital campaigns. A talent pool is almost a queue of candidates ready to step into roles which include a wide range of skills and people at different stages of their professional career. In a world of data-driven recruiting, talent pools are more useful than ever before.

According to The Economist, 4/5 of CEOs worry about skill shortages, while outside hiring at the top reached record highs, causing business for large global search firms to increase by 9% to 15% last year alone.

Nowadays companies are laying off workers and downsizing as we speak. Some industries are simply collapsing. It seems that an unprecedented number of people, all over the world, from new graduates to seasoned veterans, will be looking for new employment. At the same time the ‘war’ on top talent may recede for the time being. As companies revisit and rethink their international strategies and business practices, workers are recalculating their personal purpose and individual and family priorities, with serious implications for their geographic and work preferences and travel habits.

All of the sudden, the pool of talent has changed and expanded, whilst leaders have to prepare companies and organisations for recovery and regrowth.

A Lesson In History

Throughout history, economic hardships have created windows in which exceptional employees and leaders are widely available for a small window in time. During the late 1940s, many companies were struggling. At HP, business was slow and finances strained. But as legions of great engineers came out from of closing U.S. military labs, HP’s legendary founders Bill Hewlett and Dave Packard figured out that they couldn’t let such amazing talents pass them by. When asked how they could afford to keep taking on new people in those difficult years, their answer was simple: “How could we afford NOT to!”  Years later, when asked about their unrivalled success they routinely said that their willingness to invest in talent no matter the external economic climate was quintessential.

Harvard Business School’s Ranjay Gulati, Nitin Nohria, and Franz Wohlgezogen considered the benefits of this kind of long-term thinking in an analysis of 4,700 companies across the last three recessions. They discovered that 9% were able to come out in much better positions than they entered because of their “progressive” focus. They did cut back, but were extremely selective about when and where they did so and, more importantly, they continued to make strategic investments. Rather than thinking you’re either hiring or you’re downsizing, they ‘copied’ the HP approach after the war, understanding they could do both things if they were smart about it.

Unfortunately, most organisations make the mistake of uniformly freezing hiring in downturns. During the 2008 global financial crisis, BCG and the European Association for People Management surveyed 3,400 executives, including 90 senior human resources leaders in more than 30 countries, to see how they were responding. The most frequent action was to scale back recruiting. At the same time, survey participants rated the selective hiring of high-performing employees from competitors as one of the three most effective responses to the crisis and the one with the best impact on employee commitment. This irrationality is widespread. Those who stay rational can exploit it.

Talent At the ready

It may seem like an obvious point to begin with but building a talent pool now means that when you can hire again, and hopefully you will be soon, the talent will be ready and waiting for you. By putting in the hard work now, you’ll have a group of engaged and talented candidates ready to contact as soon as roles become available. As they’ve registered their contact details with you, you can be confident that they are interested in working for your business, which give you a head start once it’s back to “business as usual.”

Better quality in hiring

Because you aren’t rushing to fill urgent requirements, using this time to build a talent pool means that you have longer to collate and source the best talent, which is a luxury that is rarely available. With a wide range of individuals and skills to choose from in your talent pool, all of whom are ready to start working, you’ll be able to compare expertise to find the best talent for you.

As there is less rush to fill key roles, it also means you won’t miss out on talented candidates that may miss the deadline by a few days. Instead, you’ll have collated them over the lockdown period, however long that may be.

Fast hirings

It should go without saying but having suitable talent at your disposal will make filling vacancies a much quicker and smoother process. When you’re eventually ready to hire again, it will be beneficial if you can hire talented people quickly so that critical roles can be filled, and your business can return to normal! This will give you more time to focus on growing and rebuilding other aspects of your business, knowing that the recruitment side is very much under control.

Plus, with many people, unfortunately, being made redundant as a result of COVID-19, the sad truth is that the faster you can make a talented candidate an offer, the more likely they are to accept. In the aftermath of a pandemic, people will need employment and crave job security. As much as we hate to admit it, when it comes to the best talent, it may just be the early bird that gets the worm.

Build rapport with the candidates 

The talent pool approach to recruitment is largely candidate-centric, giving candidates more control. It helps you to build long term relationships, giving the candidates a chance to learn more about your business and what you can offer them. They’ll become familiar with your employer brand as they follow you on social media, receive your email updates and even research your business on their own. This makes it much more likely that a candidate will want to work for you, increasing the chances of your offer being accepted. Regular updates and content are essential to maintaining your talent pool; this provides more touchpoints to capture the attention of passive candidates and helps you to build relationships.

Talent pools also encourage two-way communication; unlike standard recruitment practise where the employer holds all the cards, engaging with your talent pool creates opportunities for candidates to talk to you. This improves the candidate experience massively as the recruitment process feels much less lonely and more transparent.

To find out more about how you can build a ready-to-hire talent pool, get in touch with the team at Talent Works International. Our experts can help you to conduct talent attraction campaigns, manage candidate data and most importantly build up and maintain your talent pool ready for when this pandemic is over.

motivate your best candidates

Once you are convinced that you have the opportunity to bring in someone you really want, arrange to have the person speak to senior leaders who can share their love and passion for your company and describe the value they hope to build with the new colleague. Pay can be important but research shows that what truly motivates knowledge workers is a high level of autonomy, mastery, and purpose. In these trying times, flexible work arrangements will no doubt continue to be key, as will the chance to keep on learning and growing while working to build something larger than ourselves.

Given our current situation knowing that your colleagues or employees are best suited for this new scenario we find ourselves in. Finding the right talent, the best fit for the job and your organisation can be a very challenging task. It is now important to find out whether your managers or your team is well-equipped of working together from various locations. It requires deep knowledge of their personalities, strengths, weaknesses, interests, work style and other characteristics. Our echnology and solutions will do the work for you, helping you discover if your people are resilient during times of hardship, if they are autonomous, if they are team players, without actual human contact. Given that our platform is cloud-based, everyone can use it from home as well. Humanity finds itself at a crossroad for various reasons now, why not help people discover and develop themselves from the comfort of their own homes?

Request a free demo:

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Sources:

https://www.hrtechnologist.com/interviews/recruitment-onboarding/hire-talent-post-coronavirus-pandemic/
https://hbr.org/2020/05/now-is-an-unprecedented-opportunity-to-hire-great-talent
https://www.talent-works.com/2020/04/06/heres-why-you-should-be-building-a-ready-to-hire-talent-pool-during-lockdown/

Creating the Perfect Internship Programme

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For the majority of young adults, an internship represents that first step, the initiation phase where you go from being a student to a professional worker. Internships are meant to help young people apply what they’ve learned all their lives and apply them to the real world. It has become a bit of an urban legend, that an internship at a respectable organisation means more than the actual degree.

However, reality has the tendency to prove us wrong most of the time. In the past few years, numerous internship programmes have come under intense scrutiny for being a very legal way of exploiting young people by paying them close to nothing, if they actually decide to pay them anything. Then again, it must be said that not every organisation looks to take advantage of young adults and offer them internships where they are being used. You might be one of the lucky ones who can say that your internship programme was meaningful both professionally and personally.

Ideally, it is best to recruit interns that are geographically close to your base of operations. Drafting young people from local universities is just common sense. Alternatively, if you recruit someone from a different location to work for a summer, it is highly unlikely they will return to you for a full-time job if you offer them one.

There are a number of factors that must be weighed in when it comes to recruiting the best and offering them the best conditions to thrive.

Firstly, it is highly recommended to recruit early in the year. If you plan to organise a summer internship, if you start looking in the spring then all the best talents are already taken. Fall seems like the ideal time to start recruiting if you wish to have the best possible students available. Obviously, this requires being proactive as an organisation.

Secondly, make their first day amazing. Keep in mind that they are most likely nervous about their first day and they didn’t sleep too much due to their anxiety. Some of the following things may help ease them in: someone greeting them as soon as they come in, make sure their offices are properly set and ready to work and take them to lunch.  Furthermore, if you will have interns in various departments try and create opportunities for them to meet. This can be easily done by creating training and social sessions for them in order for them to get more accustomed to their surroundings.

  1. Offering your interns actual work

Everyone is scared of going to an internship and all they will have to do is deliver coffee. Some of the best ways in which to offer them meaningful work is to assign a project that will impact the way business is done. Give them the possibility to present their ideas and solutions in front of the executives and shareholders. You will be surprised how many good ideas may come from someone who is new in the place of business. More often than not, interns’ ideas are being implemented and have something extra to add to their CVs. Moreover, it gives the manager a clear idea of who they can recruit full-time after they finish their studies.

  1. Continuous feedback

Although it is fairly important to offer your interns meaningful work, it is as important to give them continuous feedback. Do not drop a project on them and then check their work in their very last day. For example, L’Oreal offers ongoing feedback considering it an integral part of the development of all their employees, either temporary or full-time. And that is not all. Interns have the possibility of providing feedback as well. L’Oreal considers that there should always be a dialogue between interns and managers, thus leading to better engagement levels and productivity.

  1. Compensation

In an article from the New York Times, it has been brought up to everyone’s attention that there are violations of labour laws when talking about unpaid internships. A few of the rules that are in place at the moment state that the internship should be related to an interns’ academic capabilities, interns should not displace full-time employees and that the company cannot obtain any immediate advantage from an intern’s work. In layman terms, internships should benefit interns, not organisations. All in all, the criteria mentioned lead towards the idea that internships should be financially compensated. After all, a successful internship must be a win for everyone involved in the process.

  1. Closing time

Request a summary of your interns’ experience at the end of the programme. This is a win-win situation for both parties. The interns have the opportunity to reflect on their experience and what they have learnt, whilst providing you with valuable information on how to improve office relations, communication, etc.

If there are interns who have impressed during their time at your organisation make sure to make them offers for a full-time position before they go back to school. This is a crucial step because not only does it offer you with a young and consistent new employee but it may also drive other interns in the future to seek your programme.

In their last day, offer them a small token of appreciation. It could be a keychain, a hat or a coat with the company logo on it. If he or she had a great experience within your organisation they will wear it proudly (plus, a little bit of advertising goes a long way).

Most companies think that when interns leave that is a job well done. This could not be more false. It is essential you keep in touch with them. Managers should make sure that whoever worked the closest with an intern touch base on a monthly basis. It is also important for interns to know that the work they have put in the projects they have been assigned is developing nicely.

Finally and this is more food for thought than anything else. Just think about how you would like to be treated if you were embarking on your first internship experience. You know very well what the difference is between being treated as an equal or as a ‘servant’. By applying just some of the ideas discussed in this article your organisation will see an increase in demand for students to come and take your internship programme.

There is a real value in providing companies with the tools to carry out regular organisational assessments and this is where Great People Inside comes to your aid. Our online platform offers the best solutions and tools for your company to thrive in every type of industry and any possible situation your organisation may find itself. In terms of lowering your employee turnover rates, we recommend our GR8 Full Spectrum assessment for hiring and 360° Survey for retention. Finding the right talent, the best fit for the job and your organisation can be a very challenging task. It requires deep knowledge of your own organisation’s culture and a keen understanding of the candidate’s personality, strengths, interests, work style and other characteristics. Our technology and solutions will do the work for you, helping you find employees who can flourish and reach the highest performance required to constantly bring your company forward.

Request a free demo:

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Sources:

https://www.fastcompany.com/40556255/how-to-build-an-internship-program-that-works-for-the-interns

https://www.cio.com/article/2902929/hiring/looking-to-build-a-great-internship-program-read-this.html

https://readwrite.com/2010/05/27/5-tips-for-creating-an-interns/

Recruitment based on Organisational Culture

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Appointing leaders may seem to be easier said than done, but this is not the case at all. According to an academic research paper done by the American Psychological Association, the rate of successful hired leaders is around 30%. In the United States alone, 75% of employees have reported that their direct manager has been poorly chosen and it obstructs them from doing their work. Furthermore, 65% of them would accept lower salaries in order to change their manager with someone better equipped for the job.

There are numerous reasons why this situation occurs over and over again. Mostly, this is due to the over-reliance on intuition in the early stages of recruitment instead of using proper scientific validated selection tools. The problem that almost always arises when hiring new leaders is their incongruity with the organisation’s culture. Even though on paper the candidates may seem perfect and they tick all the boxes in terms of skills, leadership capabilities and expertise, organisations tend to overlook the congruence between their values and the candidate’s values. Consequently, leaders hired for their excellent skills and talents are often fired on the premise of poor cultural fit.

What Is Organisational Culture?

In layman’s terms, organisational culture revolves around the collective mindset and norms of employees, as well as palpable aspects revolving around the work environment which directly mirror these beliefs. The effectiveness of organisational culture relies upon the company’s workforce, business market and strategies. Moreover, given the fact that there are countless organisations around the world, organisational cultures are abundant and different altogether.

How Can Culture Be Related to Recruitment?

There is a close relation between the recruitment process and organisational culture due to their association to employee selection and retention. Attractiveness wise, culture represents everything ranging from brand image to company projects. There are organisations that hold culture in high regard and plan their recruiting accordingly. Due to this type of recruitment, only the right people are being targeted and attracted, whilst others are somewhat determined to look elsewhere for employment.

Primarily, experience and expertise are central characteristics to a leaders’ potential, but, unfortunately, they are unsatisfactory in determining leadership performance. To be more precise, personality traits such as: curiosity, self-awareness and integrity won’t help predict a proper leader to fit the role within the company. In order to properly evaluate how fit a leader is with an organisation, their motives and values should be analysed. These characteristics act as an inner compass, revealing how they would conduct activities, in what type of culture they would thrive and what kind of projects they will deem necessary or engaging.

For instance, if a leader truly values tradition he or she will have a strong opinion regarding right and wrong, will have an affinity for hierarchical companies and will exhibit a low tolerance for innovation. Simply put, these types of leaders would struggle in a creative environment. Leaders who value relationships will develop a strong bond with their staff and their focus will be on creating and maintaining collaborative work and social relations. If they are given a role within an individualistic organisational culture, which would isolate them, they will fail. Subsequently, we have altruistic leaders who focus on improving employees’ lives. If the organisations they work at are profit driven, their skills will be wasted.

Understanding the company’s organisational culture

It is absolutely essential for a company to know their own culture; otherwise knowing a leader’s motives and values becomes practically pointless. Regrettably, a vast majority of companies do not understand the importance of pinpointing their culture and generally tend to rely on clichés such as: ‘entrepreneurial’, ‘innovative’, ‘diverse’ and ‘results-oriented’. Of course, there is the off-chance a company hires a leader who can perform in any kind of environment. Unfortunately, these leaders are an exception, a rare breed, because in most cases potential in leadership depends greatly on context.

Although its significance, organisations don’t pay attention to culture, they just let it evolve from within. It is somewhat good news, due to the fact that if companies start recruiting with the idea of developing a proper organisational culture, it can vastly improve employee retention and performance which translates into growth and profits. Another argument for cultural-based recruitment is that while job demands may constantly change, culture will always be a constant within the company. Statistically, people being hired in part to their cultural fit are more likely to become a company asset.

Great People Inside provides easy-to-use tools and processes to attract, assess, match, select, onboard, manage, develop, benchmark and maintain workforces anywhere in the world.

Finding the right talent, the best fit for the job and your organisation, can be a very challenging task. It requires deep knowledge of your own organisation’s culture and keen understanding of the candidate’s personality, strengths, interests, work style and other characteristics. Our technology and solutions will do the work for you, helping you find employees who can flourish and reach the highest performance required to constantly bring your company forward.

Request a free demo:

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Sources:

https://hbr.org/2017/06/when-leaders-are-hired-for-talent-but-fired-for-not-fitting-in

https://www.forbes.com/sites/propointgraphics/2016/11/13/hiring-for-smart-talent-not-direct-experience/#37b671f42dcf

https://hiring.monster.com/hr/hr-best-practices/recruiting-hiring-advice/strategic-workforce-planning/hire-for-the-organization.aspx

Reducing Employee Turnover

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In the majority of cases, a high employee turnover is not regarded as ideal for a company’s reputation, performance and goals. The costs themselves are high due to the fact that people are leaving, thus leading to numerous hirings and training programs for the constant flow of new employees. If your company has experienced high turnover in recent times, it might be time to think about effective retention strategies.

A high employee turnover is bad for any organisation’s bottom line. It has been estimated that the cost of replacing an employee is nearly double their salary for a year. Morale can also go down if too many people come and go through the office doors.

There are a number of ways in which you can reduce employee turnover and they are not as difficult as you might think. When employees feel their work environment offers them the necessary support for them to achieve their goals that is when they thrive the most.

There are many ways in which you can make your employees feel that their work is appreciated enough so they don’t leave or you are not forced to fire them. Let’s go through these ideas step-by-step:

  1. Flexibility – Work flexibility is all about the possibility of working either from home, a café or even while on vacation, as long as employees have a good internet connection (and that is not hard to find nowadays). People are more motivated to produce great results when they have the opportunity to work in the environment they’re most productive. This idea works best on the new generation i.e. millennials.
  2. Honest job expectations – Many companies suffer from high employee turnover due to the fact that employees are assigned something different from what they have seen in the initial job description. When employees are given responsibilities that do not suit their interests and strengths, their drive to perform goes to ground.
  3. Promote a healthy work-life balance – The work-life balance has become extremely important to employees, but many managers fail to realise that. The managers should take care of their team in order for them to avoid employee burnout. Regular check-ups help, because if you observe something is not right with one of your staff you can give them a day off to decompress. It is key you do not bombard your employees with one too many projects at once.
  4. The possibility of professional growth – It is as clear as day that people are more interested in jobs where professional development is one of the advantages. In order to boost your company’s performance, (internal) growth has to be one of the core principles. Whether we are talking about a promotion or a simple salary raise, this will motivate your employees to achieve the organisation’s goals/objectives. Provide the opportunity for career and personal growth through training and education, challenging assignments and more responsibility. Welfare is important to people, undermining their value and pay would be a fatal mistake. Managers and CEOs should work hand in hand with the HR department in order to devise to most appropriate pay plan possible for their employees.
  5. Finding the best candidate from the beginning – It may seem like a pretty obvious idea, but many companies fail to realise the importance of the recruiting process. Besides the necessary skills any employee should have, try and find out if that person identifies with the company culture and gets along with the co-workers and managers.

This is where Great People Inside comes to your aid. Our online platform offers the best solutions and tools for your company to thrive in every type of industry and any possible situation your organisation may find itself. In terms of lowering your employee turnover rates we recommend our GR8 Full Spectrum assessment for hiring and 360° Survey for retention. Finding the right talent, the best fit for the job and your organisation, can be a very challenging task. It requires deep knowledge of your own organisation’s culture and keen understanding of the candidate’s personality, strengths, interests, work style and other characteristics. Our technology and solutions will do the work for you, helping you find employees who can flourish and reach the highest performance required to constantly bring your company forward.

 

Request a free demo:

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Sources:

Theculture.com

Guides.wsj.com

Thebalance.com