ESPN’s Big Layoff Was Painful; Seven Principles Will Help You Manage A Layoff
ESPN, the highly successful cable TV sports network, recently laid off over 100 staff including Ed Werder, a long-serving and highly-respected reporter. Coverage of the layoffs and Werder’s own words make clear how painful and disorienting the layoff was: Werder compares it to “dropping in on your own funeral”. The news traveled rapidly through the football and cable TV worlds: NFL commissioner Roger Goodell reportedly phoned Werder and said he was angered by his layoff. How would you manage if you needed to implement a high-profile layoff in your company?
A lay-off is one of the most difficult passages for any company, and for everyone involved. It typically unleashes a storm of emotion. Often, the people laid off are surprised. They feel hurt, victimized, and cast out. They don’t show understanding of why the layoff has to happen. They feel they deserve a better deal and expect the company to take responsibility for their personal circumstances. Often they share these feelings widely inside and outside of the company. The emotions can reverberate through the industry, especially if others feel they face a threat of layoff too.
Layoffs are tough on the employees who remain. Their jobs become more demanding with reduced staff. They need to do the work of giving emotional support to departing colleagues. They feel guilty because they were spared. And they worry that they will be next.
And layoffs are tough on management. They pit head against heart: you do what your brain says you must do, but your gut is saying it’s a bad thing. Doubts creep in: was it really necessary, was it done well? Trust in the company takes a hit; angry ex-employees may organize a backlash. The company’s reputation dims and competitors can use the layoff to make hay in the marketplace. And the firing manager can feel guilty: s/he took an action that hurt former employees and enabled the manager to be successful. When I’ve done that it made me feel selfish.
The company as a whole suffers a period of low productivity: people are depressed and pre-occupied with processing their feelings and what the new organization means for them. They are focused on the downside, not the upside.
Very few CEOs and managers will gain energy or satisfaction from implementing a layoff, which says a good things about their character. However, you can take steps before and during the layoff to make the pain shorter and less severe.
Communicate regularly to employees how they and the company are doing, well before a layoff looms on the horizon. ESPN is suffering a big profit squeeze for reasons largely beyond it’s control: subscribers are “cutting the cable” at the same time that new “streaming” delivery channels are bidding up the price of sports content. Much of the discussion of layoffs, for example coverage in The Washington Post, makes little mention of this. Putting the company’s business problems plainly on the table can improve the situation: employees will be less surprised when a layoff comes and management’s actions will appear more rational and professional.
Losing a job is big personal loss, and this is probably amplified for an echo-chamber job like sports journalism. People need to grieve before they can go on with life. Giving them early warning that company performance and/or individual performance put the job at risk can speed up the grieving process and enable employees to move ahead sooner. Psychologists speak of five stages of grieving: denial, anger, negotiation, depression and acceptance. You can see some of this play out in the coverage of Werder’s layoff. Experience with loss of important pieces of my life taught me that understanding what was happening and why helped me move through the stages of grieving and, most important, focus my energy on what I want to do next.
Once you know the layoff has to happen, get it done and put it behind you. One big layoff is much better than a series, even if you overshoot and have to hire back a bit. It’s important to move departed employees off the premises promptly, so healing can begin. Some companies summon employees to a conference room, tell them they are laid off, and send them back to their desk with a security person who lets them gather personal belongings, takes their pass, and escorts them to the door. I think this is overly harsh, as it allows no time to say goodbye, but it makes sense for departing employees to leave within a few days.
Honor your obligations to departed employees in full. This is just decency and common sense. ESPN is reported to be honoring Werder’s contract which extends to April, 2019. And likewise expect employees to honor obligations to the company. A professional relationship still exists, and all benefit from acting as professionals. Above all, treat the departed employees with respect.
Offer help to departed employees. To some degree they are unlucky. It helps departing employees heal if their more fortunate former colleagues make efforts to help them, or if the company pays for help. Helping can be awkward: managers and former colleagues may feel guilty and find it hard to engage. It’s the right thing to do, and facing the awkwardness is part of working through feelings about the layoff.
Be as generous as possible. A Welch-era division manager explained the GE philosophy: layoffs were part of the toolkit, but severance was generous. I have a number of friends who were forced out of firms but given quite generous transition packages. Their feelings are complicated, but the generous package usually gets mentioned and helps them speak positively of their former employer.
Respond to the feelings of those who remain. Make sure they understand the business necessity. Listen to their feelings and questions at town meetings, etc. Reassure them as much as you honestly can about their future. Hopefully you can bring some good news to the table and shift their focus to upside prospects to which they can work.
And acknowledge your own feelings. I like an informal SEAL motto that goes: “You don’t have to like it, you just have to do it.” It tells me that, when I have to do things that are seriously painful, it’s OK to admit I feel the pain. I just have to get the job done.
Then, having done your job as professionally and kindly as possible, focus on the future. We undertake layoffs so that the company and most of its employees can achieve a bright future. It’s time to start making that happen.
First posted @ blogs.forbes.com/toddhixon on May 3, 2017.