Managing layoffs in a hostile takeover

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    Wessam AlZamil
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    For M&A deals where optimization is required to remove redundancies, what are the best approaches to manage layoffs while balancing other important factors such as gaining trust of high caliber employees of the acquired company, maintaining a healthy culture, and accelerating organizations’ integration efforts?

    #123025

    It’s all about the communication plan and the appropriate RIF strategy. The messaging to retained employees should reflect empathy, compassion, and appreciation towards those who are let go while emphasizing the bright future for the organization and the focus of the organization on caring for it’s people and it’s clients/customers. As part of the RIF strategy, while following the letter of the law (WARN Act, OWBPA, etc. in the USA) is important, it is equally important to also follow the spirit of the law. Where possible, go the extra mile. Make sure you document all business case decisions for who will be separated and who will be retained. Perform appropriate risk analysis to ensure no disparate impact for any protected classification and craft all communications to those separated with the same empathy, compassion, and appreciation as you would for those you retain. How you separate with employees is equally as important as how you obtain and retain employees. As you balance these 2 initiatives – the RIF and retention – communication will make or break the trust, development of a healthy culture for the merged entity, and acceleration of integration efforts. Bungle the communication around the RIF or retention and you have an exponentially more challenging task of managing both and problems can spiral out of control quickly.

    When I advised on the RIF of a client during an internal reorganization, one technique I used were the equivalent of Gemba Walks or impromptu Communication Meetings with different departments. I would do this frequently throughout the week, targeting different areas of the facility, different departments, and different shifts. During these meetings, I was as transparent as possible, acknowledging missteps of the organization while demonstrating the corrections we made and the impact on the business. No company is perfect just as no person is perfect. Phrasing the communication in a manner that the audience could relate to while showcasing the WIIFM (What’s In It For Me) to those retained as well as demonstrating care, empathy, respect, compassion, and appreciation for those released all served to hep move the culture forward and make a successful reorganization. Within 30 days, the facility turned performance around and the new culture… the desired culture… began to take shape.

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