Hr Wire Article Conducting Business With Less Staff

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Hr Wire Article Conducting Business With Less Staff

  1. 1. Employment Practices 03/05/2009 Conducting Business with Less Staff Paula Santonocito Many companies are operating with significantly fewer employees than they had at this time last year. How does a pared-down workforce impact the organization? How does it impact HR? A look at the numbers There's no doubt that staff reductions have been widespread. In January alone, employers eliminated nearly 600,000 U.S. jobs. What's more, companies in nearly every industry have cut jobs. Consider some of the numbers from the first two months of this year. Department store chain Macy's announced it will cut 7,000 jobs. Caterpillar, the leading maker of earth- moving equipment, will remove 12,000 full-time jobs and 8,000 contractor positions from its payroll. Health insurer WellPoint will lay off 600 workers and eliminate 900 open positions. Wireless service provider Sprint Nextel will cut 8,000 jobs companywide. And these four companies from four different business sectors represent only a fraction of what's happening throughout the country and much of the world. Indeed, Michelle Lewis-Blossman, principal and southwest regional leader for Mercer's HR Effectiveness consulting practice, says so many organizations are experiencing workforce reductions today, indicating that sometimes the numbers seem to be arbitrary. Companies decide on a round number or a set percentage and reduce staff accordingly. Weighing the impact Instead, what Lewis-Blossman advocates is attention to the Alfred Chandler model of structure follows strategy. When an organization anticipates and then follows through on these kinds of changes, they should consider whether their strategy has changed, she says. Lewis-Blossman tells HRWire that an organization should start with a comprehensive understanding of its budget and make reductions in a detailed way. This involves looking
  2. 2. at where cuts will have the least impact. Wherever staff is providing the greatest value should be areas where the organization is less likely to cut. If an employer takes this approach, if it makes a surgical decision, it is starting in a much better position, she says. Broad cuts, on the other hand, put the employer in the position that someone has to assume the remaining duties. As a result, the company must re-examine the roles and responsibilities of the retained workforce on a departmental basis. Changing responsibilities As an example, Lewis-Blossman cites the HR department, indicating that less hiring may result in a need for fewer recruiters. If this is the case, perhaps recruiters can be utilized in sales or marketing, areas where there is still demand for the skills and expertise these employees possess. However, these kinds of shifts require training. quot;Typically people think training is out the door in a challenging economy,quot; says Lewis-Blossman, acknowledging that soft-skills training usually does get cut. However, she says that hard training, how-to training, becomes essential during periods of restructuring. Lewis-Blossman tells HRWire she works with companies that have been restructured in an effort to try and avoid bankruptcy and that they have people who walk them through, on a function by function basis, how the business will change. She recommends a similar approach for organizations that lay off large numbers of workers. At the same time, Lewis-Blossman recognizes it's not easy. quot;It's challenging because everyone thinks what they do is core because that's human nature,quot; she says. Nevertheless, in every organization there are ways to differentiate between what is core vs. non-core. Using education as an example, Lewis-Blossman points to how most organizations say, quot;never touch the classroom,quot; which might mean services provided by the central office get reduced. For HR and other members of the management team, such analysis may be new. quot;A lot of people just haven't had to operate in an environment like this,quot; Lewis-Blossman says. Primary focus Once job cuts have been made, it's not only about reassigning tasks and providing the necessary training. HR and management should also focus on how to re-engage staff and how to get the most out of retained employees, Lewis-Blossman tells HRWire.
  3. 3. Here, too, attention to core vs. non-core becomes important. quot;I think it's about delineating roles and responsibilities,quot; Lewis-Blossman says. And she indicates HR can play an important role in helping managers conduct this kind of analysis. For many managers, assistance is necessary. As Lewis-Blossman explains, for the last 15 years or so, at most organizations, things have been going along great, with additions to staff, set positions, and clear expectations. Now, however, retrenching and realignment must occur. HR and others regroup Although HR can and should provide assistance, HR professionals also need to recognize their limitations. In many organizations, HR has become an on-demand customer service function, and anyone who walks in the door thinks HR is there to listen to them, Lewis-Blossman says. This may have been okay in the past, but today HR isn't in a position to field every inquiry because it too faces changes. Therefore, Lewis-Blossman recommends that organizations train managers to deal with front-line issues. In a similar vein, to the extent that roles and responsibilities change, there may be more opportunity to rely on systems and technologies. quot;What's interesting is that at the same time organizations are cutting costs it's almost the same time to be reinvesting,quot; says Lewis-Blossman. This may or may not require capital investments. quot;It may be time to teach people to get up to speed on a new system,quot; Lewis-Blossman says. Sooner rather than later Still, even though analysis can be conducted and adjustments can be made after staff reductions, proper planning can make it easier to conduct business with less staff. According to Lewis-Blossman, a detailed understanding of the budget and an understanding of what is core and what is not core allows for more responsible structuring, for an approach that is more surgical. To go back afterwards and then move the pieces is more difficult, she says. In the current environment HR may find it especially challenging to address staff reductions after the fact. Lewis-Blossman points out that in addition to a pared-down workforce HR is experiencing a variety of elements, including an increased workload as it tries to manage internal as well as external changes.
  4. 4. Contact: Michelle Lewis-Blossman, principal and southwest regional leader, Mercer's HR Effectiveness consulting practice, michelle.lewis-blossman@mercer.com. © 2009 Thomson/West

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