Small businesses and SMEs should not rush to lay off staff, a Hull based human resources consultant has warned. Rob Coates, Managing Director of Willerby Hill says that employers may rapidly regret the ëquick fixí of redundancies during the current slowdown, which will often make them less efficient and less able to cope with the economic rigours.
Coates claims that staff expertise and skills are needed most during a downturn, to see companies through it. He said: ìApart from depriving yourself of prized assets that may be vital to weather hard times, you could be delivering competitive advantage to business rivals by letting go high calibre players whose training and development you financed.
ìThe fact is that, whatever the short to medium-term trends, the UK workforce is ageing and shrinking rapidly, with decent staff increasingly aware of their value and far more ambitious. As such, the employment market is more predatory than ever before and businesses should be positioning themselves as top employers in their sector and geographic area so that they attract and retain the best workers.î
Coatesí comments are supported by a recent Deloitte Touche study, which concludes that 2008 is the year when there will be more jobs than people to fill them. When coupled with alarm calls from various sectors about skills shortages ñ most recently the video games industry ñ there are firm indicators that UK companies are already feeling the pain.
And yet, too many companies take the knee-jerk reaction of streamlining three vital areas; marketing, training and staff - with the impact of redundancy invariably echoing long after people have departed. Apart from the skills gap, the status quo of a business can be upset, social relationships damaged and morale destroyed as the rumour mill goes into overdrive and insecure ësurvivorsí seek alternative opportunities - leading to more staff losses.
Rob Coates says that communication and transparency are vital in the face of the slowdown ñ even if business performance is robust and no lay offs are planned. In this way, everyone knows what strategies and growth plans are and what is expected of them.
And if, after all options have been explored, recruitment freezes, restructuring, redundancies or other headcount reductions are required, Coatesí Ten Top Tips can ease the process:-
1) Have a strategy of complete honesty and openness
2) Communicate with everyone - not just those affected, but those left in post
3) Always ensure that, when questioned you can justify your rationale
4) Talk to a HR expert and develop a well-planned process for before during and after any action has taken place
5) Make sure that headcount changes will actually achieve the financial savings needed to avoid repeating the exercise
6) Consider redundancy as a last, not first, resort
7) Ensure that managers have the skills, training and support needed to manage the process well, i.e. sensitively and efficiently
8) Build plans to ensure the long-term of the team
9) View redundancy as a process for redesigning how things can be done better ñ not just ëchopping awayí a cost
10) Donít avoid difficult conversations with your people; they have fears, concerns and questions that must be addressed
Donít Fire, Inspire!
Staff at a premium, warns Hull HR consultant
