Talk to us about the business climate leaders are operating in?

In our coaching work, we are observing that many leaders are currently encountering a variety of organisational transitions. These changes are occurring with a backdrop of sector-specific pressures, leading some to opt for downsizing as a strategic move to ensure a more robust P+L. During these uncertain times, organisations are therefore experiencing a loss of talent. Conversely, this is resulting in an increased availability of talent within the job market.

Two or three years ago, when uncertainty was at an all-time high, leaders were willing to make utterly extraordinary decisions. We saw some leaders who were moving staff to four days a week and temporarily adjusting pay structures. The economic context is different now. 

We have a few key drivers for recent transitions. There is inflation and increased interest rates driving a lack of confidence to invest, of course is also influenced by the media machine which also impacts confidence. Many leaders will also be going through transitions themselves as many of the cuts are happening at the top tiers.  Its not unusual that some leaders are managing their own transition out as well as some of their team members in parallel.

What’s happening in larger organisations around retrenchments?

Depending on the role and industry, we are noticing an increase in retrenchments. With industry 4.0, some of the roles that we take for granted on the assumption that they will always be around, are changing due to AI and new technologies. It poses the question… what type of leadership skills are needed to manage these transitions as well as the capability to manage growth?

Given these changes, how can leaders simultaneously care for their people and manage transitional growth?

To manage these transitions really well, organisations need to offer individual support for the people that are leaving as well as a sound process for those who are staying. 

We had a recent client who announced that there will be a tranche of people transitioning out who have been in roles for 50 years. That is extremely unusual, but regardless of the forewarning, this will have serious implications for the individuals and their identity when they are asked to leave.

When our sense of belonging breaks unexpectedly, it can trigger an anxiety response. There are of course cases where people who know it’s their time to go and want to go, can celebrate their redundancy, but that may not be the majority.

In the majority of layoff situations and with industries phasing out roles over the coming years, there will be more anxiety about job security and future employment.

With this said, looking after the individual (those leaving and those remaining) is important. Culture can be more fragile at times like this, so sending the right leadership messages will help reduce anxiety and improve the psychological safety within the organisation. In fact, if done well, it can actually strengthen the culture.

How can leaders look after the individuals leaving?

We support senior leaders in creating a program that enables a dignified exit from their organisation. It generally correlates to the amount of time in the role but even with those that have been there for a short amount of time, we should not underestimate the impact on them and their well-being when they are facing a retrenchment and how that could land for them.When a role is no longer needed or when someone can no longer meet the needs of a role, people often realise when it’s time to go, it’s time to go. In these cases, it is not wise to keep somebody inside the organisation if they are no longer serving its purpose. They will be inherently excluded by those who remain and who still are serving the purpose, so it really is the kinder thing to do.

What are the ingredients for running an outplacement program? 

It is incredibly helpful when the individual feels acknowledged and recognised for the contribution that they have made while they have been there. It reinforces that their contribution will be honored ongoing. 

A message along the lines of … “All that you’ve given while you’ve been here, we will carry forward.  Your contribution will always belong to the story of our company; it has an important place and you have played an important role in the time that you’ve been here.”

This does wonders for people’s ability to leave with their identity and self-esteem intact, complemented by sincere thanks for all that they have done. Make sure it is visible and it’s recognised publicly with gratitude, and highlight some of their unique, individual aspects as people are on their way out.

A good transitional coaching process, normally provided from outside the organisation includes career and outplacement work to provide an additional level of support.

When we deliver that coaching, we offer an orchestrated process where the individual can see what they have given, see what they’ve received, and also vitally make sure that they leave with their identity intact. This will play a very big role in successful transitions that are also visible to the people who remain.

How can leaders assess if an outplacement program has been successful?

For the individual

The rate of reemployment is the most obvious indicator. However, where we have a high number of retiring baby boomers, the rate of reemployment is not the best form of measurement. We need to look at certain wellbeing indicators.

How can you promote wellbeing?

We have a client in the manufacturing industry where we are recommending an ‘outside-in’ mentoring program formed through their alumni community. It works where you have decades and decades of corporate knowledge leaving the organisation, and you have a huge amount of goodwill sitting there in those leaving.

Where possible, we can make them mentors for the next generation coming through and create an alumni environment – the organisation wins and the individual wins. So this, in combination with outplacement coaching, is what we would call a Rolls-Royce solution. 

With the age of retirement increasing, many organisiations are also retaining people on a part-time basis to keep significant knowledge and applied wisdom within the business.

For the organisation

Managing transitions plays a vital role, particularly in the sense of safety for those who are remaining. If staff can see that people are given a dignified transition, that their contribution is duly honored, if they witness these people being thanked and being appreciated it creates ongoing engagement and safety in the culture.  Even better than that, if that contribution can be acknowledged even after they have left, in the way that leaders speak, then safety can be significantly reinforced.

For those that are staying, there can be a sense of, “Why am I here and why have you gone?” That can lead to survivor guilt. Or it can lead to a real sense of, “I want to carry on what you started. You came first and I came later. You’ve created and sowed the seeds of these opportunities for us, and we can carry these forward and honor what you’ve already laid as the foundations.”

Leaders can reinforce this. The fact is this is not a big feature in many leadership development programs whereas it needs to be. There is a big emphasis placed on onboarding, recruitment, and induction.  Yet, the end phase, just like the end phase in life for that matter, is often neglected. But it has an extraordinary yield. We advocate that managers learn these skills holistically for those who are leaving, and equally and arguably even more importantly for those who remain.

Tell us what happens when the CEO moves on? 

When the CEO moves on, the whole dynamic is amplified in its significance. If the CEO is not transitioning well, the loss of engagement, the loss of faith, and ultimately the loss of retention can be quite significant as the impact cascades throughout the company. 

What works well is when the CEO can really support their own transition with the right messaging, and if their people can be assured that the CEO, and all that they have implemented and instigated, will have ongoing significance and relevance in the organisation.When a CEO transitions badly, then the loyalty behind all the changes that they have made is thrown into question, and people can feel that they were wrong to be loyal to the organisation. What we don’t want to do is undo all the loyalty that went behind that leader. We actually want their successor to pick up where they left off and not to discredit all the good that they have orchestrated.

What are some top tips to for CEOs to navigate a ‘new beginning’ transitions ?

A corporate mentoring program is not a large spend for an organsation. Its returns significantly outweigh the investment. In conjunction with external training and facilitation resources and high quality mentoring assets such as articles and guidebooks there are also internal requirements to ensure your success.  Importantly, organisations need to allocate sufficient internal resources to manage and co-ordinate the program. It can also be useful to have a senior leader providing program governance and oversight. That effort is greatest upfront in the three months before the program commences and in the three months following launch. The demand on these internal resources will taper off after three months but still be required for the duration of the program.To ensure a high-quality program with a strong reputation that delivers on the promise, working with an experienced organisation to hone your program design and support the development of mentors and mentees upfront and throughout the program is vital to ensuring the best mentoring experience that returns the desired outcomes for mentors, mentees, and the organisation.