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People, Product & Profits: Rightsizing Your Business

According to the Greek philosopher, Heraclitus “the only constant in life is change” and going through a change like we are now is undeniably something we have to overcome. For example, during this time of COVID-19 companies are rightsizing with having to make tough decisions on who stays and who goes. As Lee Iacocca once put it, “In the end, all business operations can be reduced to three words: people, product and profits. Unless you’ve got a good team, you can’t do much with the other two.”

This is why a good process is essential when putting together cross-functional teams (e.g. production – training – inventory -marketing – sales – customer service) in order to maintain high levels of alignment in the organization. Therefore, having to layoff good, hard-working people to save costs in order to survive is a position that companies must consider, while at the same time trying to safeguard their business operations in order to thrive in difficult times.

Unfortunately, the reality is that even in post-COVID-19, companies will have to look at their current resources and decide how to restructure their organizations because the economy will be in recession. While everyone is a vital component to an organization it is important to decide what critical talent you need to keep and what potential talent we must let go. Ultimately, how we treat both of these groups in the transitionary process will be vital to the core survival of the institution, but also a lesson in how people should be treated.

For these reasons, it is important to talk about talent audits and corporate diagnostic tools to help in determining not only the potential strengths and capacity of key staff/teams but also the mental health of each employee and how they will complement the corporate strategy. Furthermore, understanding how to maximize your resources by redeploying people and carrying out proper outplacement to mitigate employee/corporate stress is something that needs full attention.

Understanding Corporate Potential & Capacity for Change

When rightsizing your operation it is important to examine the current potential & capacity of your talent and how it will align with the reorganization strategy. This is why talent audits are an important measure used to get a baseline of your current team, but they can also be used to help identify the employees’ potential bench-strength & capacity in the rightsizing and reorganization of companies.

In order to determine your bench-strength, the use of psychometric assessments is helpful assessing the inherent potential and capacity of your existing employees. It’s important to stress that when making decisions on rightsizing operations that past performance doesn't necessarily predict future performance especially when a change occurs. For these reasons, it is imperative that you have a baseline of your existing culture through a talent audit to better align the right potential and capacity to develop into the other roles.

Specifically, talent audits can be conducted to add value to organizations in order to:

1) Provide statistical analysis of the attributes and characteristics of a group of individuals;

2) Help identify the characteristics of people who are at different levels of potential;

3) Provide a prescriptive analysis of the key strengths and synergies to build stronger teams.

The aforementioned provides a reference point to help in making strategic decisions on who might be the best fit to align with the corporate vision to reorganize the culture. Research from the Self Management Group found that increased engagement within teams are directly correlated in being able to identify synergies within the organization, and how they can be deployed appropriately to maximize team performance.

Outplacement of Employees

In times of change, it is also important to treat everyone who worked with your organization with compassion and humility. Going through a talent audit using a psychometric assessment can also provide career redirection strategies for those who are being let go. As such, individual candidate career management reports should be provided to exiting employees as a courtesy to help them with their new career search. Career management helps to exit employees and devise action plans to learn more about their strengths and how they can be deployed elsewhere to be successful.

Furthermore, anyone who is being let go will experience a certain level of personal stress as well, and it is important to also offer them guidance on how to manage that energy appropriately. Self Management Group also recommends that companies offer a virtual support assessment such as the Stress POP (i.e., online self-help stress coping assessment) to manage through this time of change.

Maintaining Corporate Vitality in Difficult Times

While losing one’s job can be very disheartening and stressful, research does indicate that actually the people you keep and redeploy or add further responsibility to in the company tend to experience a higher amount of stress than those who leave.

According to Gartner Inc., in a 2018 employee survey, that over 80% of employees going through an organizational transformation experience had higher levels of cultural tensions due to competing priorities that they don’t know how to balance. This is why when you are redeploying employees that you need to be able to assess individual and corporate vitality frequently. During times of stress, it is important to efficiently maximize your resources, but also that they are well supported to reduce vulnerabilities of your teams.

In order to maintain high levels of engagement in times of transition, it is imperative that companies carry out corporate diagnostics/surveys frequently to understand how to help people manage and navigate stress appropriately. Corporate diagnostics like the Corporate Vital Signs™ survey offered by Self Management Group in partnership with the Canadian Institute of Stress:

  • Provides current-state feedback to corporate decision-makers, focused by key stress indicators rolled up and broken out to corporate levels, divisions, and key staff groups as defined by corporate strategy; and

  • Provides action recommendations to each employee from our confidential online assessment, highlighting those personalized steps to manage one's energy at work to contribute more fully to their team’s performance.

According to a most recent COVID-19 HR Pulse survey by Josh Bersin found a number of factors that were important but two of them stood as important to both HR professionals and employees such as:

  • Mental/personal health; and

  • Managing remote work.

Given the current circumstances globally with COVID-19, both of these factors also line up to the research carried out by the Canadian Institute of Stress. Their research indicated that there are three main pillars of mental health that are drastically improved by using corporate vitality diagnostic (i.e., Corporate Vital Signs™) tool regularly to monitor the pulse of the organization. By doing so their research from carried out from numerous companies found that keeping a pulse on the organization to mitigate corporate vitality issues lead to improvements in the following 3 areas:

  • · 32% decrease in work stress

  • · 38% increase in work satisfaction

  • · 62% higher work engagement

Based on these current statistics, this is why HR teams play such a huge role in safeguarding lasting success to make sure employees manage change appropriately. These surveys need to be done often and compared with previous analyses in order to remedy any future concerns. While “stress” and “anxiety” are the two words used frequently today by executives, what they are referring to operationally is the interactive effects of these three main pillars on the capacity to influence positive corporate change. A diagnostic tool like the Corporate Vital Signs can help in strengthening the capacity for change in ways that leverage what organizations are already doing right.

Mitigate Stress and Improve Corporate Initiatives

When redeploying current employees it is essential to quickly identify situations where individuals or teams devitalization may put a corporate initiative at risk; and, then, to collaborate in framing and implementing the best strategic solution. When redeploying teams or work (i.e., like we are seeing with remote work in COVID-19) you must have some kind of safety measure in place to ensure that stress does not erode productivity, but also mitigate the stress with strategic initiatives.

Understanding the key personnel is the first step to corporate development and redeployment. Next, is to ensure your redeployment strategy is healthy by alleviating stress in employees in order to become more resilient and energetic as they seek out and enjoy the satisfactions offered by their work. Last, don’t forget about those you outplaced from the organization as they did fully contribute to building your business. It is always important to treat everyone with respect when managing through times of change.

Please contact Robert Dougan, MA to learn more about how talent audits and corporate diagnostic tools can help your organization during times of employee redeployment or rightsizing.