Avoiding Post-Downsizing Voluntary Turnover

When an organization makes the difficult decision to downsize personnel, it is typically due to financial reasons. Even it is not necessarily due to economic hardships, without proper communication, internal and external publics often assume that it is. Naturally, survivors speculate on their personal future with the organization and wonder whether they have job stability or not. After all, if the organization decided to downsize, what is to stop them from doing another round of layoffs shortly after? The fear of being layoff victims themselves leave survivors to lose their loyalty their current employer and start looking for job stability in other organizations.

Management does not always know what is to come in the foreseeable future. In fact, it is quite possible that one round of layoffs can indeed lead to others down the road. How can employers retain employees with such uncertainty of the future? It would be unethical for employers to make false promises of stability to employees and difficult to give any definitive answers. The most effective ways that management can retain employees is to communicate any information in regards to the future of the organization honestly and frequently. Whether the news is good or bad, big or little, it is important for employees to be fully aware of what is to come so that they can appropriately plan for the future. Furthermore, organizations should invest in developing the existing employees' skills through training and seminars to increase their marketability. It shows appreciation and value to the employees, who in turn may remain loyal to the organization. The company ultimately benefits from staff development because it reduces turnover and improves skills, which leads to higher productivity.

Be a Transformational Leader

Successful management of employees is a challenging and dynamic task in any given situation. When companies go through organizational changes such as layoffs, it is especially difficult for managers to keep their employees focused and maintain productivity. Studies have shown that transformational leadership has an impact on cynicism about organizational change (CAOC). It helps to minimize resistance to change and negative emotions towards an organization during change.

So, what is transformational leadership and what does it entail? There are 6 dimensions or behaviors of TLB that are designed to help managers achieve successful leadership outcomes. The most important factor is identifying and articulating a clear vision to the employees. Regardless of whether an organization is going through change or not, it is important that employees are clear of what the company's vision is because it gives them insight on their future looks like with the organization. The second dimension is fostering the acceptance of group goals. Transformational leaders should promote cooperation among employees to encourage each other to work towards a common goal. This keeps them involved and reliant on each other to get through the change. The third behavior is the expectation of high performance from employees. Although the organization may be going through change, expecting high levels of quality and productivity builds confidence in employees and gives them a sense of accomplishment. Fourthly, transformational leaders should provide intellectual stimulation by encouraging employees to find creative ways of improving their performance. This should reduce cynicism because increased involvement helps enhance employees' perception of change. The fifth behavior, which is being a role model seems cliche but is extremely important. It is imperative for leaders to set behavioral examples that are consistent with the organization's goals and vision. This helps employees build a level of trust and commitment to the organization. Lastly, individualized support is key to transformational leadership. Employees are likely to respond to the initiatives of leaders who care about them as individuals and take the time to hear their input. Regardless of how busy each day is, it is crucial to set time aside to run pulse checks on employees in order to effectively lead them through change.