At a crucial time such as the present, where it’s more important than ever for companies and people to come together to fight the global pandemic brought on by the novel coronavirus, business owners and business leaders should make business continuity and talent retention a top priority. Layoffs should definitely not even feature once in their radar of thoughts!
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The first thing that most employees worry about during a global recession is job security. People work to earn a livelihood – but recent recessions have led companies to layoff employees by the hundreds, be it the 2008 economic downturn or the ones before that.
Salesforce CEO Marc Benioff recently made headlines for his ‘’no significant layoffs” pledge while others like Morgan Stanley’s CEO James Gorman committed to holding onto staff and foregoing layoffs within the company.
It’s time other business leaders follow suit.
Read More: Are You Ready For A Post-Pandemic Working World?
Here are a few ways for companies struggling through the current uncertainty to rethink layoffs or better still, avoid it.
Always Plan Ahead
As a business leader, if you feel that laying off the people who helped your company get to where it’s at during a recession is valid – the onus is on you to plan ahead and plan better! As a company owner or leader, one of the first things that is key to ensuring stability of the company is also ensuring that there is a healthy corpus lying in the company bank account for the next six months at least. This has to be assessed before expanding the team or hiring more people.
Businesses who follow a knee-jerk reaction of laying off staff in times of crisis to save the company money portray that they don’t have the funds to pay and were running the show without planning ahead.
This is where it becomes crucial to ensure that when you hire people, you have enough funds to pay their salaries for the next year at least, or six months as a minimum, so that in times of a sudden crisis – both you and their livelihood are well protected.
As a business leader: you are not only responsible for your company but also your people! Remember, your people are your best assets!
Hire Right, Don’t Over Hire
One of the biggest reasons that tech startups fail is that they hire wrong or hire too many people for tasks they may not need done given the current stage of the business. Before shaping teams and forming roles, it is crucial for business leaders or startup owners to ensure they have a lean team.
Several startups suffer from the shiny object syndrome and might hire professionals with several years of industry experience and backing behind them – but this comes at a cost. Before on-boarding someone who has over 20 years of experience, it helps to first ask yourself whether your business is at the stage where you need an executive at that cost.
Another aspect lies in hiring right. Employees who can multi-task and be responsible for several important aspects of the business and not just one of them, are always going to be assets to the organization. So shortlist and hire your talent based on what they can do and what more they can do and never assign one task per employee and never hire for just one task.
Read More: A Few Best Practices to Help Navigate the Digital Recruitment Landscape Better
Cut Costs Somewhere Else, Not Over Salaries!
A key question for HR leaders, business owners and business leaders to ask themselves during a time of recession – especially if they are going to consider laying off their most important resource – their people, is – can they cut costs somewhere else?
There are always a series of ways to cut corners during a crisis. In a family, you don’t throw one of your own out when you are faced with monetary challenges, do you?
Similarly, it is important for a business to first think about other (creative) ways where they can cut costs before targeting their employees livelihoods.
The long-term effect
Economies thrive or suffer recession due to various factors. While the current state of the world is to be blamed on the Covid-19 outbreak, the biggest learning here is that one can never be too prepared.
Most companies who decide to layoff their employees might not have thought about the mid to long term effects.
Laying off people now will mean that you don’t have sufficient staff for seamless business upkeep in the near future, when things start looking bright again (and hopefully, they will start looking bright again soon!).
At a time like this, instead of being a negative influence on people’s livelihoods, it is more important to focus on being humane.