Redundancy: The Business Case for Handling Employees with Care

1. Redundancy:The Business Case for Handling Employees with Care Presented to CANTO by Susan Coote 22 June 2005

2. The changing trading climate in the 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

3. New mix of people New operational structures Dynamic Expedient Lean Exciting& fun Little shared experience of successful radical change Complacent Lack of preparedness for competition Awkward about change Tough climate Cultures vary considerably Start-up Incumbent

4. The organisational life cycle strategic direction profitability management expertise following useful procedures organisational maturity team working & leadership, flexibility, innovation Disciplined Cost management Procedures visionary leader entrepreneurs just do it! Skills Fun time start-up organisation establishment consolidation

5. 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 change

6. Within the psychological ‘contract’ 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 many people remain aggrieved

7. Impact 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

8. 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

9. The 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 effort

10. A 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 sophisticated skills

11. Benefits 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 well?

12. Many 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 experience of others

13. An event from: CANTO & 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

14. We recommend internal training 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 reputation

15. Contact • CANTO • Teresa David • +1 868 622 4781 • Teresa.david@canto.org • Coote Harvard • Susan Coote • +44 (0) 1727 837397 • +44 (0) 7711 419292 • susan@cooteharvard.co.uk • www.cooteharvard.co.uk

16. Thank you