The Business Case for Handing Redundancy With Care June 20051 Redundancy: The Business Case for...

June 2005 1

The Business Case for Handing Redundancy With Care

Redundancy:Redundancy:The Business Case for Handling The Business Case for Handling

Employees with CareEmployees with Care

Presented to CANTOby

Susan Coote22 June 2005

June 2005 2


The changing trading climate in The changing trading climate in the Caribbean regionthe Caribbean region

Competitive momentum for change impacting on all

Regulatory drive to remodel the telecoms industry

Greater number of employers Demand for skilled labour in new start-ups

New skills and old Need for radical change in incumbent

companies New technology, new skills, fewer employees.

Redundancy in incumbents

June 2005 3


Cultures vary considerablyCultures vary considerably

New mix of people New operational

structures Dynamic Expedient Lean ExcitingExciting & fun& fun

New mix of people New operational

structures Dynamic Expedient Lean ExcitingExciting & fun& fun

Little shared experience of successful radical change

Complacent Lack of preparedness

for competition Awkward about

change Tough climateTough climate

Little shared experience of successful radical change

Complacent Lack of preparedness

for competition Awkward about

change Tough climateTough climate

Start-upStart-up IncumbentIncumbent

June 2005 4


start-up organisation establishment consolidation

The organisational life cycleThe organisational life cycle

time

organisational maturity

team working & leadership, flexibility, innovation

strategic direction profitability

visionary leader

entrepreneurs

just do it!

management expertise

following useful procedures

Disciplined Disciplined Cost Cost managementmanagement

FunFun

ProceduresProcedures

SkillsSkills

June 2005 5


The context of employment is changing The context of employment is changing

Psychological contract altering from: Job for life, safe and secure Entrepreneurship not required ‘Wait and see’ approach to career

To: Project or contract basis, tenure less secure Several careers Personal responsibility for active career management

Employee risk profile must Employee risk profile must changechange

Employee risk profile must Employee risk profile must changechange

June 2005 6


Within the psychological ‘contract’ Within the psychological ‘contract’ employees have expectations to employees have expectations to

Be treated fairly Have secure employment Have scope to demonstrate competence The opportunity to develop skills Have a career Trust the organisation to keep its promises

The organisation can be damaged if too The organisation can be damaged if too many people remain aggrievedmany people remain aggrieved

The organisation can be damaged if too The organisation can be damaged if too many people remain aggrievedmany people remain aggrieved

June 2005 7


Impact of Fear & UncertaintyImpact of Fear & Uncertainty

Valued, dynamic employees go first if voluntary scheme allows

Reduced morale, commitment & loyalty ‘Keep the head down’ mentality Reduced productivity Inflexibility Focus on internal processes rather than external

customers High state of employee anxiety Energy taken by dealing with fear & uncertainty

June 2005 8


Redundancy & Stress Redundancy & Stress

Redundancy is highly stressful (47/100 Holmes & Rahe Social readjustment rating scale)

Usually accompanied by restructuring (`36/100)

Everyone needs some level of support The surprise is the impact on those who STAY!

Demoralised Insecure Unvalued Anxious Am I next?

Unless you take positive

action

Unless you take positive

action

June 2005 9


The situation is inevitableThe situation is inevitable

Employee attitude affects external perception of the company

Consider the damage disaffected employees could do to: Customer opinion Other employees

Company will survive and grow if you do it well.

It’s worth the effortIt’s worth the effortIt’s worth the effortIt’s worth the effort

June 2005 10


A positive climate enables progressA positive climate enables progress

Sensitivity and honesty Openness with all employees Complete fairness in execution of the process Experience effective leadership and good

management Manager willingness to tackle awkward &

personal situations

Managers must learn new and Managers must learn new and sophisticated skills sophisticated skills

Managers must learn new and Managers must learn new and sophisticated skills sophisticated skills

June 2005 11


Benefits of handling redundancy wellBenefits of handling redundancy well

Confident, secure workforce remaining Create space for career development Experience of good management is

reinforced Good public standing Good press relations possible Customer confidence maximised

Can you afford not to do this Can you afford not to do this well?well?

Can you afford not to do this Can you afford not to do this well?well?

June 2005 12


Many Telcos have been hereMany Telcos have been here Incumbents 20 –30 years later

AT&T BT France / Deutche Telecom Telstra

Mobiles after 8-10 years Orange

Opportunity to learn from them Short cut the process

You can make rapid progress using You can make rapid progress using experience of othersexperience of others

You can make rapid progress using You can make rapid progress using experience of othersexperience of others

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An event from: An event from: CANTO & Coote HarvardCANTO & Coote Harvard Early September 2005 Objective

to assist managers in dealing effectively with redundancy for selves and other employees

Topic Areas Business context & opportunities in sector Best practice in redundancy procedure How to display leadership & achieve active

engagement Ways of providing effective support Understanding blockages, resistance and conflict Personal & emotional change Personal planning & preparation

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We recommend internal training We recommend internal training and active support for leavers and active support for leavers

Send delegates on the Sept event Establish internal training programme Build support processes for

employees leaving Actively support your workforce

It can enhance your community reputationIt can enhance your community reputationIt can enhance your community reputationIt can enhance your community reputation

June 2005 15


ContactContact

CANTO Teresa David +1 868 622 4781 [email protected]

Coote Harvard Susan Coote +44 (0) 1727 837397 +44 (0) 7711 419292 [email protected] www.cooteharvard.co.uk

June 2005 16


Thank youThank you

The Business Case for Handing Redundancy With Care June 20051 Redundancy: The Business Case for...

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