This phrase has never been truer than in the days of layoffs. Surely we all know that it can be incredibly expensive to lay staff off - and yet it sometimes appears that it is the first line of defence in some companies (and many law firms). Consider this post from the "Director Magazine" - the in-house publication from the Institute of Directors. Called "Think before you fire" it reminds us of the drawbacks to firing staff which I summarise here:
- Increased cost
- Lower productivity
- Brand damage
- Damage to leadership reputation
- More claims from remaining staff
The article goes into more detail, obviously, but it's not rocket science is it? Surely we all know this stuff? And yet...
There are a number of reasons that it goes on - and why it probably shouldn't:
- Many organisations have gained "slack" in their headcount - those people who are not performing, but who have been just a little too tricky to move out. In this economy, the pain is, perhaps, worth it. Think how much the firm would have saved, however, if they have been management properly all along.
- It is a very visible expression of management action. "Look!" say the Board "See what we are doing to improve PEP this year. We are cutting costs!". Cutting costs - really? This year costs will be high because of redundancy payments and associated costs, and next year costs will be high because of recruitment fees.
- It's something that people with limited management experience and knowledge understand. Well yes - but that doesn't make it the right thing to do. As far as cooking is concerned, I basically understand two dishes and know the number for pizza delivery off by heart - that doesn't make it a good diet, though. Good management is available to every firm. Hire professionals to do the job - not enthusiastic amateurs.
Perhaps this will define the next stage of my career - stating the bleeding obvious...