Making Difficult Decisions: Choosing When to Lay Yourself Off

Steve Smith challenged me in a comment to the cowardly layoff/no feedback posting: “What would you have done if you were the manager who layed off these people?”

I’ve written about layoffs in a previous Software Development column, but let me address the specific problem Steve described:

  1. The manager needs the paycheck.
  2. The manager (or more likely, the manager’s management team) chooses to use some form of numbered ranking system to choose which people to lay off.

What does the manager do?

Couched in these terms, it doesn’t look as if the manager has too many options. Effective problem solving involves deriving more possible solutions (at least three solutions). Here’s what I’ve done when faced with this dilemma:

  1. Elicited the real need (requirements): “Ok, we have to lay people off. Which projects are we not going to complete? Which work will we focus on? Are we changing strategy? …” You can’t know who to lay off until you know what work you will be performing and what work you won’t be performing. Using rankings without understanding the value of the work behind the rankings guarantees you’ll make poor decisions.
  2. Learn what the layoff package is. If you’ve managed through three or four or five (gack!) layoffs, it’s time to consider laying off yourself. The more technical staff you remove, the less necessary the managers are. Here’s why: as you lay people off, the best performers have removed themselves, as well as you removing the “worst” performers. (The best people have found their escape hatches.) If you’re still at the company, and you have fewer people (but competent people) to manage, does the company need you in your position? If you volunteer to lay yourself off, you’re more likely to improve (negotiate) your layoff package than if you blindly wait for the standard package.
  3. Describe the worst thing that could happen to you. “If I lay myself off, these are the worst things that could happen:” Then take that list, and talk about it with your partner, a trusted friend, your accountant, or whomever you need to talk to, to see if you can live with the worst thing that could happen. How long could you live with the worst thing that could happen? If you became unemployed now, how long could you live in your house or apartment? Do you have bills you can’t manage in three – six months without a job(such as college tuition or nursing home bills)? What about your self-esteem?

The first time I was laid off, my self-esteem crashed and burned. I defined myself by my job. The money wasn’t nearly as big a problem, although I didn’t have three months of mortgage saved up. Because my self-esteem crashed, I found it difficult to work on my resume and interview. So the worst thing for me was not knowing how to define myself, so I could obtain a new job.

Once you know what the worst things that could happen to you are, can you manage around them?

If you can, then maybe it’s time to take the layoff. Otherwise, what do you need to do, to be able to manage your life through a layoff?

Too often, management doesn’t define a strategy, other than “lose headcount so we stop hemorrhaging money.” You’re more likely to retain your staff (and your job) if you help articulate a strategy, define projects that support that strategy, and then closely manage those project.

And if after all of this, you still have to lay people off, be honest. Don’t apologize, don’t make it a performance issue (unless it is). Be clear, be human, and treat people with respect. Who knows who’ll lay you off the next time?

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