Kelly & Marshall Goldsmith: Doing Layoffs the Right Way
Having to lay people off is one the most difficult challenges faced by any chief executive. If you ever have to do this in the future, here are a few thoughts for your review.
If at all possible, avoid “across-the-board” packages. We have witnessed multiple examples of companies that offer generous packages to any employee in a certain category who chooses to leave the company. This has the short-term advantage of avoiding unpleasant conversations and making life much easier for managers who do not have to make hard decisions. It has the long-term disadvantage of providing an incentive for your best employees (who can easily get another job with a pay raise elsewhere) to leave—while providing an incentive for your worst employees (who cannot get another job) to stay. While this may seem insane, it happens far too often. It is better to face the short-term pain of disappointing average performers who are forced to leave the company than the long-term pain of losing the great people you will need for the company’s future.
Go out of your way to communicate to your top performers that you value their work and want to keep them. A few years ago, we reviewed research from one of the world’s leading accounting firms. They conducted interviews with top performers who were leaving the firm. What did they discover? Over half of the best people who left had no idea that the company thought they were important or even that the company wanted them to keep working there! They did not leave because they wanted more money; they just wanted to know that the company cared about them.
As a CEO, make a list of the people who are making the greatest contribution to the value of your organization. Our great friend, Sandy Ogg, the former CHRO of Blackstone, taught us this principle. In Sandy’s research, he found that in many companies there was a surprisingly low correlation between compensation, recognition and value creation. Some roles in the company were several levels down from the top yet were critical for value creation. The importance of these roles was not being recognized. In a few cases, the CEO of the company did not even know the names of some of the most important value creators.
Get personally involved with your most important value creators. Let these people know why they are so important to the company, and show them by your personal connection how much they mean to you. One CEO of a huge corporation estimated that 50 percent of the value of the company was being created by about 50 people. Sandy Ogg also points out that every position does not need an A performer. He notes that in some roles a C performer may be acceptable, yet in other roles the future of your company may depend upon the right A+++ performer!
Get personally involved with the high-potential leaders of the future, at all levels. While you many not have the time to meet with each high-potential leader individually, you can visit high-potential leadership programs and meet with them collectively. They may not be your company’s most important contributors today, but they may well be in the future. Your interest and caring shows them that they are important to you and to the company.
On one hand, it is important to treat every person in your organization with respect and dignity. On the other hand, leadership is not a popularity contest. You have to let the people you need to keep the most know how truly unique and important they are. If you don’t, your competitors will.
Chief Executive Group exists to improve the performance of U.S. CEOs, senior executives and public-company directors, helping you grow your companies, build your communities and strengthen society. Learn more at chiefexecutivegroup.com.
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
Executives expressed frustration with their current strategic planning process. Issues include:
Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns. They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning. Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process. This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented. If you are ready for a Strategic Planning tune-up, select this workshop in your registration form. The additional fee of $695 will be added to your total.
2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
Limited space available.
10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.
