Shouldn't the employees who survived a downsizing be thankful their jobs were saved? Perhaps, but employees who see their friends and colleagues let go will be fearful and disconcerted. They will wonder if the company is still the best place for them to pursue their careers. Given a chance to go someplace they think is more secure, employees may begin to be disengaged and jump ship.

As always, the employees most likely to have the opportunity to get a job elsewhere are precisely the ones you least want to see go. Working to improve employee retention after downsizing is a wise tactical move. In this article we'll show how it's done.

Getting off on the Right Foot

Companies that do the right things pre-downsizing will have the fewest problems with retention post-downsizing. The key is to engage employees in the downsizing process; they need to feel that downsizing was done with them not to them.

Involving employees in downsizing is counterintuitive; the natural tendency of managers is to shut themselves behind closed doors and call all the shots. At a minimum, very open and honest communication before, during and after the downsizing process helps maintain employee morale. Even better is to ask employees for their ideas on saving money and generate new revenue-not only do you get good ideas, you prove to employees that downsizing is only being used as a last resort.

Keeping employees engaged not only improves retention, it improves productivity at a time when reduced headcount makes productivity more important than ever.

Information and Engagement

Another way to improve retention is to survey your employees to find what their likes-dislikes, ideas for improvement, etc. Employers often are hesitant to do a survey after downsizing fearing they will get bad news, but it is a powerful way to engage and retain those who remain. In addition to the usual survey questions, you can ask questions aimed specifically at finding out how people are feeling about the downsizing process and life in the organization after downsizing. The survey process needs to include not just asking the right questions, but also analyzing and publishing the results then working with your people to implement change.

For example Drake's HR consulting team performed an overarching HR audit for a chain of restaurants and that audit included an employee survey. The company suspected that people were not happy with their compensation. However, the survey showed that people were not unhappy, they were just confused. Employees didn't know if they would get a bonus or not and what it would be based on. The company didn't need to increase the compensation, just do a better job of communicating how it worked-which is exactly what they did.

Digging for More Insights

Another basic but underutilized tool is exit interviewing. When anyone leaves after a downsizing event, HR should be doing exit interviews to get as much intelligence from the employee as possible.

However, just as with surveys, it is not enough simply to collect information. It is important that every six months or every year you gather up the data, summarize the results and communicate to employees what you are learning from the exit interviews. Then, explain what you are doing in response to what you've learned. If you fail to summarize and communicate or don't make positive changes employees will suspect that you may be hiding the results and all your good intentions will be undone. By doing these things, not only do you make the changes needed to improve retention, the simple fact of listening to employees drives engagement making it less likely they will leave.

One client asked Drake's HR consulting team to conduct online and telephone exit interviews for their call centre business across North America. The client believed the high turnover was caused by poor compensation and poor supervisory skills. But the exit interviews showed that people were actually leaving because they simply didn't like the job. This result showed why the recent investments in training supervisors and increasing compensation were not having an effect. After the HR consulting intervention the client changed their recruiting process to ensure candidates got a realistic sense of the job before they were hired. Listening to employees through exit interviews, and acting on what was learned, enabled the call centres to improve retention.

A Sense of Belonging

Finally, organizations should look at a variety of culture building activities that create a sense of team. People will stay to support their team members even when times are tough. Being on a team can improve morale and help people focus on bigger goals. You don't need sophisticated or expensive HR consulting interventions to create a sense of team. Meetings to discuss shared objectives, celebrations of successes, and group meals are all simple ways to create a sense of belonging.

All the actions we have discussed are good HR processes at any time. What companies overlook is how these processes are particularly valuable after a downsizing event when morale is fragile and the organization absolutely needs the best from every employee.

Drake's Approach

Drake has many decades of experience helping small and mid-sized firms with their HR needs. We've learned how to take off the shelf solutions and tailor them to the specific needs of the client's business because every company truly does have some unique issues. We take a consultative approach focused on generating Exponential Impact (tm) for your business, through a long term relationship. Our focus is on helping you engineer an improved bottom line through the efficiency and effectiveness of your people. If we can't do that then you shouldn't work with us!