Now is The Time To Lead With Empathy- Lessons from Post 9/11 Downsizings
These are harrowing times. Having been in the workforce post 9/11 and through the 2008 recession, I have lived through three economic downturns. For much of our millenial workforce, this is their first downturn. To make matters worse the Covid-19 Pandemic is creating a downturn like no other. No industry, geography or sector is immune to the financial impact of the virus. We are very much in uncharted territory as it relates to the economy.
In the past week I have received calls from three clients who have lost their jobs, I have advised several CEOs on workforce reductions and I saw a client organization shut their doors and lay off 300 employees. This is just the beginning. While many organizations will have to cut deeply to stay in business, others will not be so fortunate. Government assistance will be more important than ever as we navigate through these tough times. My advice to those who have lost their jobs is to stay strong, get mentally and physically fit for the challenges ahead and focus on personal resilience. It is going to be a long a bumpy road ahead, so be prepared and be willing to make short term sacrifices. That may mean taking a job that is well below ones qualifications and pay scale just to meet obligations, pay the bills and keep food on the table.
I was asked by a coaching client yesterday how to go about laying off members of their team with decency. He explained that he was being forced into making tough choices and would have to let several very good people go. I explained that he must deliver the message with empathy and caring. Doing it over Zoom makes it even harder to be authentic, but it can and must be done. The key is to deliver the message quickly and succinctly. Letting an employee go doesn’t mean that you have to terminate your relationship with them, it just means that you will no longer be their boss/employer. I shared a story from 2001 with him.
“Letting an employee go doesn’t mean that you have to terminate your relationship with them, it just means that you will no longer be their boss/employer.”
During the fall of 2001, not long after 9/11 I was working at the Director of Organization Development at The Motley Fool, an Alexandria, VA based financial services and education company. The Motley Fool had been a a darling of the first internet bubble. The company had 30mm unique visitors per month and was the top financial channel on AOL. We had 450 employees. 9/11 changed everything for our business. The ad supported model was no longer working and the revenue no longer supported the bloated headcount. We knew we had to rightsize the organization. The Motley Fool had a very tight knit culture and it felt like a big family. Our Chief People Officer, Lee Burbage and I were responsible for leading our effort to downsize. We knew that we had to let people go in a way that mapped to our company culture and our value of empathy.
The approach that we followed has served me well as I have unfortunately led other companies through similar downsizings over the years. What we did was to determine who would need to go using objective criteria, we created fair severance packages for those leaving and created resources to help. The day of the layoff all employees were invited to a town hall meeting with those remote employees dialed in (this was 2001 so pre-video conferencing). Tom and David Gardner, the brother founders of the Motley Fool stood in front of the entire company and delivered the message that today would go down in history as the toughest day ever for the Motley Fool. They explained that between events outside their control and some irrational exuberance which was inside their control, the company was in trouble. They went on to explain that a decision had been made to let 100+ employees go in an effort to save the Motley Fool. Those who would be asked to leave would receive severance, continuation of benefits for a time period, assistance with resume writing and job searches and they would become members of the Motley Fool Alumni network. Those that were staying would be asked to do more and with less. It was clear these were tough times and that for some leaving was going to be easier than for those that got to remain.
Washington Post article from 2001
The keys to doing this right at the Motley Fool was empathy, compassion and transparency. Rather than just letting those that would be leaving know the approach of sharing the news with the whole company first and then explaining how this would work for those impacted set a level playing field, cut down on the rumor mill and allowed the employees to support each other in this time of need. There were tears in the meeting and lots of hugs and sadness as those being let go learned their fate. We closed the office and everyone headed to Murphy’s tavern for the afternoon. (Unfortunately commiserating over beers is not possible during the Covid-19 pandemic). The Washington Post sent a reporter to the tavern hoping to get some soundbites from disgruntled laid off employees. The article they wrote was titled“A Wake For The Motley Fool”The article documented the emotional day, but highlighted the culture, the sadness and the love the employees had for each other and the company.
“They cared,” says Crist of her bosses. “They were very emotional about it.”
The Motley Fool has gone on to survive and thrive, yet the memory of 2001 is indelible in Tom and David Gardners memories. For me I helped the company shrink for 450 employees down to 85. During the last round of layoffs I had to let myself go. There was no longer a need for the Chief HR Officer and Director of Organization Development. It was an easy decision, but it still hurt as I loved the company and wanted to remain a part of it. As we were planning that last round of layoffs it was clear we were going to dismantle the HR function. In addition to my role, we had to let go our recruiter. Dave Alagno was a 26 year old rock star recruiter. He had hired so many great people at the Motley Fool and now his name as on the list as well. In HR we made the list, so we knew our own fate. I wanted to help Dave to land another role. I recall asking him where he wanted to work next and if he had identified any jobs or companies of interest. Dave mentioned a recruiting job at AvalonBay a multifamily housing company also based in Alexandria, VA. Without hesitation, I picked up the phone and called the head of HR at AvalonBay. I explained that we were having to let Dave go at no fault of his own and that she would be crazy not to interview him. Within a week Dave had landed that role and 19 years later he is still at AvalonBay as their Vice President of HR. Dave’s path was documented by the Washington Post in a 2001 article “Taking A Chance at Happiness”
“His co-worker (Brian Formato), who also worked in HR, called the companies he wanted to apply to, saying, “I have this great candidate named Dave Alagno.” Alagno did the same thing for his friend. A fun trick not everyone can do, but it worked for Alagno. Alexandria-based AvalonBay Communities Inc., a real estate investment trust, called him in for an interview and three follow-ups.
He was offered a job as the hiring manager on his birthday, Nov. 14. He started work at the company before Christmas.”
This is not 2001 and the job market and overall economy is going to be in much worse shape. We need each other more than ever. As organization’s make the tough call and let people go, now is the time to step up and show empathy, be supportive and do what you can to help others in need. If you are in a leadership role and you are letting people go, you can and should be a resource to them during their time of need. We will recover from this hardship and how you behaved in crisis will forever brand you. It is your call how you handle the crisis at hand.