Downsizing? Stop the Rumor Mill Today
4 Ways to Boost Employee Engagement during a Reduction in Force (Yes, really!)
with Linda Deering, COO, Sherman Health, Elgin, IL
Since 2006, Sherman Health in Elgin, IL has had to reduce its labor force multiple times to respond to declining net revenue in the ever-shifting operating environment. And despite continued efficiency measures—even in the last 18 months, Sherman has steadily tightened operations while improving employee, physician, and patient satisfaction. Currently, the organization is ranked in the 90th percentile for inpatient satisfaction, 91st percentile for physician satisfaction, and wait for it…97th percentile in employee satisfaction.
The Secret
"Our success really boils down to two things: transparency and shared decision-making. This requires disciplined, no excuses, accountable leadership and adult to adult communication," adds Deering. From financial challenges and the strategic plan to benchmarks and comparative data, Sherman keeps zero secrets. Executives don't tell employees what to do. Teams of employees solve problems. "When we treat people like the talented and brilliant people that they are, they act accordingly."
To succeed, transparent, assertive communication and ongoing skill development for leaders are must's. "It's human nature—especially for leaders—to solve problems—so we disallow that," she explains. "It's our job to facilitate getting results through our employees…to let them tell us the answers."
Case in point: In 2009, Sherman communicated to its employees 90 days out that there would be a Reduction in Force (RIF) to close a $4 million gap in operating expenses. It asked for their cost-cutting ideas in the meantime to reduce the number of eventual lay-offs. The results: $3 million in employee-submitted cost savings ideas. Only 20 positions had to be eliminated, which was far fewer than anticipated.
A final thought from Deering: "Recently, a CEO contacted me the day before her organization's RIF. She was panicked. There was no time to implement any of the pre-RIF tactics I recommend." So instead, we needed to focus on the message.
"I told her, ‘If you do just one thing, express your confidence—passionately—that this is the right thing to do for the 99 percent of employees who will still have jobs in your community. Instead of leading with how badly you feel, talk about how you are all running this organization together.' The next day she called me with such relief in her voice. She said focusing on the positive made all the difference."
4 Ways to Do It: What Works |
1. Prepare in advance. |
Assemble the leadership team to build consistent talking points. Be ready to answer specific questions including: Will anyone in the C-suite be leaving (i.e. shared impact on all)? How will people leaving be treated (e.g. services, compensation, placement resources)? How will things change with fewer staff? Be upfront about staff expectations. |
2. Hold employee forums. |
Gather all employees prior to the RIF to share what is happening transparently. Tell them how they can help prevent/reduce the size of future RIFs (e.g. cost savings). Explain the external environment and why adjustments must be made. Connect the RIF to your organization’s mission and urge everyone to manage the RIF as a mature team focused on providing great care at the lowest possible cost. |
3. Step up communication. |
Monday morning stand-up meetings provide a quick way to provide updates on the evolving plan and progress on dollars found versus needed. Use an internal newsletter and a hotline to manage rumors and update the message frequently. Also, always manage the message. Every leader should have clear and consistent talking points so that all employees hear the same things. |
4. De-brief leaders on RIF day. |
The day valued employees lose their jobs is never easy for anyone. Human Resources plays a vital role, but so can an end-of-day briefing where leaders can share feelings, what went well, and opportunities for improvement. Remember to always manage the message and update the message frequently. |
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