Is COVID-19 forcing you to restructure?

5 tips to safeguard your company’s reputation and its future

Brussels Airlines, TUI, Ryanair, … the list of companies that will restructure as a result of the COVID-19 pandemic threatens to become very long.

Of course, we do not wish this to happen to any company, especially if layoffs are imminent. Any restructuring, however inevitable, often feels like a personal failure for both employee and employer. However, if you tackle it in the right way, with attention to communication to all those involved, it can also mean a new start.

The challenge for every CEO who is confronted with this is to come out stronger as a company and to be able to grow again. The success of the restructuring will determine the reputation and future of your organisation…

That is why, based on our years of experience, we formulate 5 crucial recommendations that will help you to make a successful restart possible.

1. Develop and share your vision of the future

Most companies are able to explain in detail why they are redeploying their activities and why they are restructuring by means of figures and graphs. The market conditions have changed, the competition can produce more cheaply, R&D costs a lot of money, accumulation of losses,….

It often becomes a lot harder to explain from day one what they want to achieve and how they are going to do it. In uncertain times, however, employees expect support and structure. Give them a story they can believe in. Especially today, people need perspective. Their daily lives don’t need to be dominated by fear of dismissal, they can also be fed by the desire to be part of this new chapter in the life of the company.

The collective redundancies directive does not make it self-evident to immediately put all the details on the table. Nevertheless, as a company, you should be very clear (in the conditional form, as required by the Renault Law):

  • Why are you convinced that this new organisation will be successful? What is your ambition?
  • What does this mean concretely for the people, in the short term and in the medium term (different ways of working)?
  • Which principles & procedures will you use during this process: consultation, guidance, objective criteria, etc.?

These are the three questions you absolutely have to answer.

2. Show your true face

In the many change projects we have supervised, we have never met a CEO who did not consider the human consequences of what he or she was about to announce. However, we have met many who had the natural reflex to become an emotionless robot the moment they delivered the message. Perhaps a psychological defensive reflex, but with negative consequences for their image and that of the company.

You can’t fake emotion because your audience will see it. But you do have to make sure that you actually convey what you feel, in words and in actions. Go to the people, share their sadness and insecurities, say you are sorry, underline the fact that it is not their fault, dare to say that you do not have an answer to everything at that moment, dare to listen…

Mind you, it’s not about how you feel, it’s about realizing that this is not an easy time for your employees and that you want to do everything possible to organize this in the best possible circumstances, with the aim of getting the company back on track.

3. Stay present and keep explaining

After the announcement, a process of consultation and negotiation with the trade unions will start. These are often intense times, in which management sometimes loses sight of the fact that there are still a lot of people with questions, frustrations, uncertainties and doubts.

All studies show that people in stressful situations find it more difficult to process information and to focus. Not only do you have to make information manageable, you also have to give employees time to process it and ask for clarifications.

Therefore it is important to plan extra communication moments. This way you make sure that everyone has understood everything and knows what the next steps are. Line managers play an important role in this. In larger organisations they may not be involved in the decision-making process, but they do get the questions, frustrations and uncertainties of their colleagues all over them. They need to be able to deal with this in an appropriate way and act as a barometer of the situation in the field, so that you can adjust the communication. Coaching these line managers is essential, so that they know what to do and they can let off steam once in a while.

4. Pay as much attention to the ones staying as to the people leaving the company

The legislation on collective redundancies builds in a long period of time during which leavers and stayers remain active together in the workplace.

Because the automatic focus is on the consequences for those leaving the organisation, employees who remain on board are often neglected during restructuring. However, they will have to shape the new organisation, by exercising new functions, learning different ways of working, explaining what is changing to the external stakeholders. It is they who will make the restructuring a success story.

So it is not only important that they understand the restructuring and that they understand that the company has dealt correctly with the leavers. They must also trust the management, believe in the new vision and actively contribute to its realisation. So even after the social plan, build in sufficient time, energy and communication for the development of your new company.

5. Talk about your restructuring with the outside world

It is a legal obligation to announce a collective dismissal procedure internally before informing the outside world. However, the external perception of how you deal with this restructuring will be crucial to the success of your plan.

Will your suppliers and customers continue to have confidence in the viability of your company? Are policymakers and opinion leaders aware of the why, the what and the how? Or do they react based on the emotional reactions of employees and trade union representatives in the media? Do the media get enough clarity to get a feel for the challenges your company is facing and the vision of the future you are striving for? Do they realize that you are firmly in control of the process and clearly know where you are going?

 

Would you like more information about our services for restructurings and change processes?

Don’t hesitate to contact one of our experts:

Mathieu Van Overstraeten
Senior Consultant
mathieu.van.overstraeten@akkanto.com