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Downsizing companies - things to consider

Organisations downsize through necessity, taking cost out of the business so that they can remain competitive and/or refocusing activity so that they can survive.   

Organisations that downsize at the right time and in the right way usually return to profitability reasonably quickly and go on to achieve continued growth and prosperity.

Ensuring that you have the right people to lead your downsizing activity is critical.  As is ensuring that you identify the critical capability needed to take you from where you are now to where you need to be.

When an organisation communicates the need to downsize, individuals become unsettled and sometimes unproductive and if the change isn’t managed effectively, the most talented and able individuals “jump ship”, leaving the organisation sometimes with large pockets of mediocre talent.

What are the critical considerations when downsizing:

  • Be open about the need for change, communicating the reasons for the change, the process of change and the likely impact of the change.
  • Ensure line managers are “on message’ with the change and are adequately trained to have meaningful conversations with individuals and teams.
  • Establish what activities and capabilities are critical to the organisation and use this to identify its future shape.
  • Build a fair and robust process for assessing existing capability and the allocation of people into roles.
  • Build support mechanisms, which will enable people to quickly become effective in new or redefined roles.
  • Recognise the need to provide support for those who remain within the organisation as well as those selected for outplacement.
  • Review HR processes to ensure they are still aligned with the organisation’s change in direction, structure or focus.

Cornelian Ltd
39 Prestbury Road, Cheltenham GL52 2PT
Tel: 07880 769906