Article (September-2018)

Articles

Layoffs has to be the last resort

Sanjeev Bhatia

Designation : -   Co-Founder

Organization : -  Onlymobiles.com, Surat

01-Sep-2018

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Do you think layoffs are strange way of dealing with cost-cutting or re-organisation?
SB Yes and No. This is very tricky question. While sometimes, because of changes in business dynamics, we may feel that certain skill manpower become redundant all sudden and we may not be able to fit them within the organisation in any other department. At that time, layoffs become a very strange way of dealing with cost-cutting. Sometimes, we may able to upgrade the skill set and make them adjusted to other division. Layoffs are the last resort to us. We strongly believe in lean culture and we try to keep our recruitment as less as possible. That's the best way forward.
What is the biggest challenge in conducting layoffs?
SB The biggest challenge in conducting layoffs is to deal with employee emotions. Despite of any kind of golden handshake you offer, handing over pink-slip is always painful for all stake holders. As mentioned earlier, we consider layoffs as the last option. We internally analyse and try to accommodate the employee(s) into newer functions. Sometimes, even invest into their re-skill development.
Are there alternatives to layoffs? Can organisations think of some creative ways to downsize without letting the employees lose their jobs?
SB Sensible hiring is the only solution. When we are having start-up culture, management tend to be super excited even with smaller success and suddenly talks starts revolving expansion. Now sudden expansion plans always resulted into bigger recruitment than the required. Because you are running against time and I have seen in Indian companies that we believe that more the manpower, more the business. But that is not true in today's scenario. So the first alternative is to avoid excessive and emotional hiring.
Second alternative is to invest into skill development. If your hiring is right, then each of your employees deserve to be with you. So, simply you can explore the option of re-train them for some other functions and see how it goes.
Another alternative is to refer our own employees to other organisations. In the past we have done that and we have got good response. When an employer recommends their own employees to other organisation, value of a particular set of employees also increases. The end objective is to ensure that your employees get the steady income.
Whose call is it anyway? Does HR have a say in the layoff process?
SB It's always a joint call between HR and the respective department head. Its always important to have HR say in the layoff process. It's the HR department, who get the employees on board, groom them, develop them - so there is absolutely no way that HR do not have a say. HR opinion are mostly unbiased and that helps.
As an HR manager - what has been the most difficult decision that you have ever made in a layoff process?
SB I am lucky enough that I have not gone through such kind of difficult situation. But I do remember one incident where a particular mobile handset brand asked us to recruit 7 people when they were entering into India. We have recruited them and they joined. Suddenly, their India management has decided not to launch a particular product line for which, these employees were recruited. Fortunately, we were having some vacancies and we were able to accommodate those employees with the same skill set. But yes, this incident added pressure over us for a while.
What is the role of HR in meeting employee expectations - of those who are being asked to go and of those who remains but may lose faith in the organisation?
SB HR plays a very vital role in meeting employee expectations - either in the case of those who are being asked to go and of those who remains but my lose faith in the organisation. 
So, here is what we do -
We conduct one-to-one meetings with those employees who are being asked to go and explain them the actual scenario, where the organisation forced to hand over pink slips. We also offer generous golden handshake and in most cases, we are able to accommodate them to other organisation via references.
We also conduct a small open-house with the employees who are still part of the organisation and we make them aware about the real scenario. I believe that hiding anything from the employees is uncalled for and we must share all details with the existing employees who have trust on the organisation and staying with us.
Do you think a dreaded thing like layoff can be dealt with positivity or optimism?
SB Yes, I don't only think but I strongly believe that a dreaded thing like layoff can be dealt with positivity or optimism as long as it is conducted with unbiased approach and compassion for employees. Employees are always wise. They understand. We just need to be truthful with them. Help them to upgrade their skill-sets. Deal with them as a true stake-holder.