Retrenchment always happens as a result of plummeting sales, low productivity or sudden market instability. Although an unpreferred option, companies should temper its impact on the physical and emotional wellbeing of the employee. It can also spark off a series of communication tangents in the way of other employees who take this as a cue as to what’s in store for them. Damaging as it is to employee morale, untimely communication can affect brand image to a point of no return even if the crisis abates in due time.
Softening the effects of retrenchment has positive effects for both the employee and employer. Enabling talents to transition into a new state where they can be employed or upskilled to take up new roles can be a great differentiator than allowing them to wallow in distress. No company can hope to gain losses by eliminating talents who they don’t care to reinvest in. As a two-pronged strategy, reinvestment in stakeholders (in this case, employees) also pumps investor interest. After all, investors are privy to the way corporations deal with crisis and the post-crisis period.
Not only does the transition process pivot the strategy from ‘rejection’ to ‘transformation’, it also aids employees overcome their fears and face their next step with the right attitude. As for the employer, this strategy helps them leverage the support of both the departing as well as surviving employees. To transcend the myth that ‘downsizing will further lead to increased revenues’, companies need to first focus on creating ‘employee goodwill’ as a measure of its growth and brand popularity.
For many companies, helping out their exiting talents with transition can be a fairly new experience. There are many outplacement support services firms that cater to this requirement by focusing on the niche requirements of talents and how opportunities in the industry look like. Many executive talents would be far removed from the job-search scenario for years together and these companies can offer unlimited support in finding the right opportunity for them.
