Management Development in a Recession

by Lucy Cadman @ Developing People Limited

I am very fortunate that my own career has never yet been affected by redundancy, but sadly at the age of 43, my husband has proved not quite so lucky – tomorrow is his last day of work at what has been his job for the last four and a half years. Unfortunately his own redundancy (along with the twenty or so colleagues leaving with him tomorrow) is just the first part of a three-part wave of redundancies in the business scheduled for the next three months, so many others will shortly be facing the same fears around trying to find new employment.

With news of a “double dip” recession, more short time working, further redundancies and unfortunate business closures, it is not surprising that many employees – staff, managers and leaders alike - have become nervous about what the future holds for them. It is understandable that this will cause some people to become distracted and therefore not completely focused on what needs to be achieved. A potential consequence of this is that they become less productive, less creative and take fewer risks, which is obviously not what a business needs in the current climate. It becomes an ever-decreasing cycle of less productivity, poorer results and potential job losses, and it is hard to see a way towards breaking the cycle.

It is even more important now than ever before, therefore, that managers are trained not just to recognise the ‘mood’ of their staff, but that they are also given the skills and capability to influence the motivation and morale of their staff in a positive way. There is no doubt about the fact that some business will have to restructure and make staff redundant, but the way managers handle this sensitive and emotive issue can have a big impact not just on those who leave, but also on the morale and commitment of the staff who remain.

It would be an understatement to say that my husband has not had a good experience from his managers surrounding the news of his redundancy. Thankfully he does have an opportunity to retrain, but the news was not given sensitively or kindly, and he has recently learned that there will be no management staff in the office on his last day at work to wish him well after four and a half years of 3am starts. He feels unappreciated, uncared for, and would not jump to the front of the queue to recommend his current employer to anyone else considering embarking on a career with them.

One of the key characteristics of how successful organisations perform after any such restructuring is how the employees who remain feel that their colleagues who left the business were treated. Organisations whose staff felt that their redundant colleagues were treated poorly often subsequently struggle with low levels of employee motivation and productivity for a while after the restructure. Treating people ‘unfairly’ can range from a number of things. For example, redundant staff may have experienced:

* No sensitivity in breaking the new of forthcoming redundancy
* No apparent logic to who is made redundant and who is not
* Little or no support to find a new job.
* No opportunities for retraining.
* Redundancy payments handled incorrectly.
* Broken promises from managers.
* Leaving the organisation’s premises with out any recognition or thank you from their manager.

It is important therefore that managers are given the appropriate management training and support to help them deal with the consequences of a business restructure. For example they need to be able to:

* Give appropriate time, attention and sympathetic support to affected staff.
* Help staff to focus on the future and not dwell on the past.
* Give practical and useful advice and guidance about how to find a new job.
* Demonstrate independence and not collude with staff.

Management training and development can therefore play a vital role in a successful restructure. Cutting back on training costs will only worsen the situation, but investing in training will help managers deal with the effects of redundancies sympathetically and appropriately, and it will also enable them to keep an eye on the mood and motivation of their staff who remain. After all, you want staff who leave the business to be prepared to recommend it to potential employees in the future, as well as needing to maintain the productivity and commitment of those who remain, if the business is to have a hope of riding out the current recession and moving forwards into a successful future.