Clearly these aren’t the best of times for employees on Wall Street. Caught in the web of terrible management decisions and the subprime mortgage fiasco, many are finding themselves out on the street. Unfortunately.
From a public relations perspective, these situations always interest me. One reason, I guess, is that during my time at BFGoodrich we closed a number of large facilities (in Akron; Los Angeles; Miami, Okla.; Oaks, Pa.) and eliminated thousands of manufacturing and white-collar positions. And eventually we even closed and relocated our corporate headquarters.
No fun in any of that. Trust me. Particularly when over time you knew personally many of the people who were losing their jobs. Did we handle those plant closings and job eliminations perfectly? No. I’m not sure that is possible. But we tried — and we followed some principles that I believe work.
One, tell employees (and if possible) their families first; we never wanted an employee to learn about a layoff or facility closing by first reading about it in the newspaper or hearing it on TV or radio. Two, make sure your management group — from the top of the organization to the bottom — knows what is going on. One-on-one communication works. Three, be as open and forthcoming with the news media as possible. These situations, in my opinion, are no different than how you would manage a crisis: openly, honestly and quickly. Four, make sure those directly involved know what is going to happen next and when — and how they can take advantage of counseling and outplacement services. Be prepared to answer questions and distribute the questions and answers widely. Five, if anything, communicate more after the original announcements. That’s particularly important for those employees who are going to continue with the company and maintain those vital relationships with customers, shareholders, suppliers and other members of the community. Six, tell as much as you can as quickly and as completely as you can. Don’t let the process, rumors and uncertainty go on a minute longer than necessary.
Anyway, what got me thinking about this was a story in The New York Times Saturday, “For Wall St. Workers, Ax Falls Quietly.” Here are the opening paragraphs:
People on Wall Street seem to be vanishing overnight.
Thousands are losing their jobs as hard-pressed banks cut deep. But while layoffs are nothing new in the financial industry (they come with almost every downturn), this round seems different: it is eerily quiet.
So quiet, in fact, that people refer to these cuts as stealth layoffs. Some bosses hardly say a word after people are fired. At Citigroup, Goldman Sachs and Morgan Stanley, for example, the first clue that someone is gone can be e-mail messages that are returned to senders from a former colleague’s inactivated corporate address.
I know there is no easy way to handle these job cuts, but something tells me that it would be better and even more humane to eliminate the jobs and tell everyone sooner versus later. And we’re looking at a lot of job eliminations. From the article again:
Citigroup, for example, said last year that it would eliminate 17,000 jobs, or about 5 percent of its work force. Then in January, Citi said it would dismiss 4,200 more people. In April, it said an additional 8,700 would go.
Drip. Drip. Drip.
But news about Citigroup apparently isn’t all that bad. In an article adjacent to the one about the layoffs comes news that the bank has appointed a new chief innovation officer. That means Citigroup now has two innovation officers. This is a great country.
Principle seven: Don’t keep adding senior staff (particularly when it looks like the positions may be redundant) while you are making other jobs disappear. In my experience, that makes people a lot less enthusiastic about being innovative or anything else.