Downsizing is a serious commitment with long-term consequences. Take a serious look at alternatives: Early-retirement incentive plans, voluntary exit incentives, work-sharing, cut backs on the use of overtime or temporary staff, company-wide pay cuts, short-weeks, reductions in benefits and entitlements, hiring freeze, reducing head-count through attrition, retaining and moving staff between areas. Involve ALL employees in the review of all the alternatives. Everybody should understand the objectives and feel part of the process.

Weigh the potential costs of downsizing. It can often be an expensive decision when you start calculating consulting and attorney's fees, unemployment claims, severance pay or possible litigation. Beyond raw costs, layoffs affects morale among the remaining employees, which affects continuing performance.

Determine the types of work that can be eliminated, the functions, the people. Review documented performance, and move good people to replace poor performers. Forget narrow job-functions - good people like the challenge of change.

Focus on key people - the positions and talent that must remain. What does the organization need for the future? What areas will be most profitable? Who are the emerging leaders? What type of talent will help get the company through the rough times, and back to growth and profit?

Once it has been decided that a layoff is imperative, establish communication strategies - for those being laid off and those that remain. Include outside stakeholders: customers, suppliers, shareholders, local community. Before and during a RIF, transparency becomes more important than ever.

It's important for managers to develop an open dialog with their teams, and answer any questions as honestly as possible. Each person should get a private meeting with a manager to hear the news.

The separation package should include a mix of benefits and severance to support people while they look for a new job. Try to provide assistance to help those affected find work. When possible, offer career transition support and access to Employee Assistance Programs (EAP). Provide a financial safety net and outplacement services. This also sends a message to current employees that the organization takes care of its people, even in the most challenging times.

In the last issue of eNews (15 Sept, 2009) we discussed Do's and Don'ts for employees. I received many requests from employers, large and small, to do a similar check-list from the employer perspective. Here is my focus list:

• DO over-communicate, making sure that everyone has been involved in the decision-making process.
• DO have the CEO (and/or senior managers) make the announcement.
• DO ensure that layoff procedures make sense, are non-discriminatory.
• DO make sure the cuts are deep enough to benefit the company. The only thing worse than a RIF is a second RIF.
• DO show each exiting employee R-E-S-P-E-C-T.

• DON'T let news of the layoff "leak" out via email, or hearsay.
• DON'T get HR "temps" to do the dirty work. Respected managers must be directly involved and VERY accessible.
• DON'T make the mistake of thinking that work is eliminated with people. Those in the trenches know different.
• DON'T allow senior managers to spend on unnecessary projects like office renovations or bonuses.
• DON'T get stuck in reduction mode. Regroup, refocus, and invest in your remaining employees.