Conducting Layoffs

Having been a leader through many layoffs in my career (not surprising since I spent the first part of my career at GE with "Neutron Jack" Welsh) and they always suck.   At times I have felt like Ryan Bingham in the movie Up in the Air. (except unlike him layoffs had a high personal toll on me).

The folks at Andreesen Horowitz put out a timely post on Planning and Managing Layoffs. It is an excellent resource and a great checklist for planning and conducting reductions.   However, the post doesn't fully communicate the amount that layoffs suck and the level of emotional impact both on the affected person and the manager forced to conduct the layoff. 

During the crash of 2000 and 2001, I was a leader in a firm that went through more than five rounds of layoffs.   Yes, we could have cut deeper earlier but the downturn had repeated waves of economic impact with some geographies continuing to produce and while other geographies were negatively impacted early.   We did layoffs differently each time trying to find a way that didn't suck.  We did one-on-one layoffs.  We did small group layoffs.  We did large group layoffs.  We had the direct manager communicate the layoff.  We had a CXOs communicate the layoffs.  We failed.  All the different approaches sucked.

We did get a few things right.   We were transparent about the business performance before and during the layoffs.  People knew where sales were at and how much capital we had in the bank.   We were objective and fair in deciding who would be laid off vs. who would live to work another day.  We were authentic about what was happening and why.  Finally, we felt and showed tremendous empathy.   Mark Suster had a good blog about Hard Decisions Require Empathy.

In the end, we thought all the employees would hate us.  Instead, they appreciated our transparency, objectivity, empathy.   When we started the next company, many of those laid-off employees became early hires of the next adventure.


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