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The media has been profiling mass global redundancies over the past 12 months across different sectors. What have you been seeing locally?  

We are certainly seeing an increase in redundancies or if not redundancies, planned redundancies that are still confidential across our client base. We are seeing this in government and certain areas of corporate and within smaller organisations as well, and NFPs, particularly NFPs who rely on regular giving.

 

What do you think are the key drivers for these redundancies – AI or otherwise?

Ongoing uncertainty and tough market conditions continue to prevail and organisations need to respond strategically and operationally.  AI is definitely in the mix because companies are realising that there is more and more that they can automate that doesn’t require human intervention. There is also just the impact on different industries around the cost-of-living issues that we are all experiencing. That is certainly impacting some markets more than others. Additionally, just change in general. As strategies change then structures need to change to support those new strategies that organisations are zeroing in on. Some sectors are squeezed more than others, particularly retail and linking that back to the cost-of-living crisis. 

 

How do redundancies affect a business? Can you talk a little bit about that in terms of culturally and commercially.

Redundancies absolutely affect a business in many ways. For example, when performance in an organisation has not been managed, and a new leader can come in and start managing performance really well. This can necessitate redundancies because certain roles in the organisation are no longer working and so somebody is now cleaning that up. Now, in a strange way, that can strengthen the organisation because those that are performing well disconnect inevitably from people who are not performing well but that can also cause fractures and friction in the cohesion of an organisation. There can be an unfortunate but necessary realignment towards, hopefully, not just a performance culture, but a performance and a wellbeing culture. If it’s a large scale redundancy that’s due to a change in the market or AI coming in to replace a portion of the workforce, then that can have different implications, and it’s all going to come down to how it’s managed and the quality of the process by which people transition out of the organisation.

This is the often-overlooked part, the quality of the process by which those who are remain observe all that change playing out in the organisation.  They observe and the level of care and attention its getting to be a sound process with the due acknowledgements and the dignity of departure for those that are moving on. 

 

 

Can you take us through maybe some key people strategies leaders need to address when managing redundancies?

I’d always start with a look at how much forethought, care, and strategy has gone into attraction, recruitment and onboarding, and consider counterbalancing that with that same degree of care, forethought and strategising about how people transition out of the organisation. Because what we see is a lot of energy applied into that first phase and not so much energy into that the final phase of how people depart and move on. And yet we know that people depart and move on because organisations aren’t families. Belonging is temporary and conditional, not permanent. I’d start with if you can shift that focus onto a different phase of the employee life cycle and consider how well people leave and how do those that stay witness the process by which those who are transitioning out leave, then there is really considerable upside for the organisation in that. 

What I am talking about specifically is looking at that end of the employee life cycle. By all means looking at what precipitates redundancy. Has there been a good performance management process? If there is, has that been consistent across the whole organisation? Do non-performers actually receive management focus in a promptly, not in an overdue way? And then if you are confident that you really have nailed the performance management and improvement process so that people who no longer can occupy their roles are given the opportunity to transition out in a sound, timely and dignified way, then you can look at, well, once they leave, what support do they get? 

Now, we know you are much more likely to have long-term brand advocates in your alumni staff if you give them support as they transition out. With career and outplacement support, we spend a lot of time perfecting what is a good coaching experience for somebody who’s leaving, and we have distinct and unique elements in there to orchestrate a good leaving process, even after they have left, and to make sure that they haven’t left a piece of their identity behind and they are not facing into a vacuum, disempowered, because they’ve been unceremoniously dumped out of the organisation. 

In summary, making sure that the trigger for a departure is preceded by a sound performance management process, making sure those who are leaving get the support as they leave. Now, that’s external support, as I’ve mentioned in the form of career and outplacement coaching, but it’s also internal support in the form of a good farewell and an acknowledgement upon departure for all that they have contributed. That is not just great for them, that is great for those who remain because it’s sending the message to ongoing staff that people are appreciated here even when they’re leaving. The company is really good at thanking them and not making their contribution invisible as they leave. 

Finally, it’s super important to then put the attention on the stayers where there could be a sense of that survivor guilt, then what is the process by which we support those who remain to carry on the good work of the company and not to feel deflated because their highly regarded, colleagues are moving on? And that involves the whole organisation moving into a new phase. This is how you move the system into a new phase by having an enterprise-wide process so that any redundancy doesn’t live on as PTSD in the system. 

 

Have you seen redundancies work well?

Yes, when it is clearly understood across the whole organisation. Sometimes, when an organisation needs to radically alter its core business focus to remain competitive, to make sure that they maintain their market share, it’s important that a capability review is conducted to re-engineer the organisation to stay in the right focus for success in its market. 

In a recent example resulting in 30% redundancies, the organisation needed to modernise its operational focus. That was off the back of updating its strategy. The tech stack was not fit for purpose.

There was a lot of duplication, inefficiencies and slow processes given the technology had been around for some time and needed to radically improve. What we needed to do was make a clear context for all the change, and the context was capability and modernising the organisation. So when the new structure was built, we carefully co-designed it with the executive team so that the structure would deliver on the strategy and vision, and it would overcome some hurdles and obstacles that had been frustrating staff for a long time. 

It was called a ‘capability review’ rather than a restructure. It did include a complete organisational redesign, but what was grounding was coming back to the fact that the organisation is a collection of roles and functions temporarily inhabited by people, and those that were to occupy those roles needed the capability to do so. Now, the capability needed ten years ago is completely different to the capability set needed now. Even one year ago was considerably different to the capability set needed now. The executive team also put themselves on the line in the capability review and said everything is on the table and all roles must be relevant and all people who remain must have the capability to deliver to the requirement of their role. 

 

Can you give me an example where it’s all gone wrong?

Any restructure that doesn’t make sense through the lens of the organisation’s vision and strategy, like a knee-jerk restructure, “We’ve got to cut costs, let’s just trim from here, here and here,” tends to leave problems in its wake. If any structural change is connected to what is going to get us to our vision and what is going to successfully enable the implementation of our strategy, then it stands a much better chance of making sense to people and strengthening rather than weakening the organisation as it’s implemented.

Of course, that is just the commercial side. Then there is the whole people and cultural side, which is about how this is being communicated. Have staff had the chance to have a say and have a voice? Has there been a thorough discovery process? What is the notification like for those roles that will be made redundant? Will there be the opportunity for voluntary redundancy? It’s about bringing the people and the commercial soundness together into a well-led major change. 

That is the other mistake companies make when they think… “Oh, we’re just trimming. It’s not major,” and then you get halfway through, pressure is escalated on the finances and suddenly they’re in a major change that they had downplayed. I think it’s really important that we don’t downplay the significance of, let’s say, changing the structure in any way in your organisation.