How to Downsize an Organization
In today's business world downsizing and rightsizing are very common. However downsizing can be an overwhelming process and be disasterous if not properly handled. Organizations should ensure to have a plan in place and do research of both its internal and external resources in order to get desired results.
- Difficulty:
- Challenging
Instructions
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1
Consult with the Human Resource Department and formulate a key downsizing taskforce consisting of department heads and HR officials.
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2
Look at the organization's financial information and business organizational structure, as well as the business plan to determine which divisions or departments can be outsourced or completely eliminated.
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3
Put in place a timeline and develop severance packages. Ensure that policies are in place to handle security issues and/or disgruntled employees
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4
Develop a plan to communicate with staff, clients, and vendors regarding the downsizing. Make sure that this particular step is not done too soon or too late, because you could lose important employees or staff if you wait too late or too soon to communicate your plan.
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5
Contract an outplacement service to assist those who are being laid off and implement early retirements.
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Tips & Warnings
Stop rumors of layoffs and downsizing by being upfront and clear about your plans with employees.
Don't wait to the last minute to lay off employees without giving proper notification and time for employees to plan ahead.
Utilize legal consultants to review policies and plans to ensure that discrimination or improper procedures are not used.
