Wednesday, August 1, 2012

You Can Prevent Layoffs

As a manager, here are some actions that you can take to reduce the likelihood of layoffs in your organization:
First and foremost, watch out for creeping structural complexity. Just like any living organism, organizations have a tendency to grow, adding unnecessary layers, positions, and locations. As such we end up with headquarter staffs, divisional staffs, regional staffs, and local staffs all creating work that justifies their existence. Maintaining structural simplicity to begin with, with limited layers and as few extra locations as possible, is one way of avoiding layoffs.
Phase out products and services. Although we are always looking for new ways to benefit customers, often we don't eliminate the ones that have outlived their value. Without sunset laws for outdated products and services, we allow costs and infrastructure to build up that will eventually have to be taken down.
Manage the balance between today's revenues and tomorrow's opportunities. Managers always have a choice between investing in current operations and innovating for the future. When the balance is overly skewed towards short-term revenues, it's easy to build up costs (and people) that provide results today but cannot be sustained in the long-term.
In today's business environment, layoffs have become an accepted fact-of-life and a common tool for managers to maintain profitability. But we might be better off if we spend more time preventing layoffs rather than managing them.
By RON ASHKENAS - managing partner of Schaffer Consulting and a co-author of The GE Work-Out and The Boundaryless Organization.

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