Planned public service cuts put businesses on edge

by Janie Smith02 Jul 2014
When it comes to job cuts, they don’t get much bigger than the federal government’s plan to cut 16,500 public service jobs in the next three years, with 6,500 of those expected to be in the ACT.

The uncertainty in the public service has spilled over into Canberra’s business world, with the number of ACT employers looking to decrease staff in the next three months doubling since the previous quarter, the Canberra Times reported.

It’s not just the employees who will be made redundant who will be affected – job cuts and restructures impact on the entire organisation and the workers who remain.

Dealing with all the processes around losing employees can also put a strain on HR if the department isn’t properly prepared.

Management consultancy Change2020 co-founder and co-director Vicki Daniel told HC that her philosophy on cuts like those expected in Canberra’s public service is, ‘Do it quickly, do it once and do it well’.

She is involved in a lot of restructures and shared her top tips for making sure things go as smoothly as possible.

Be clear about your purpose

“The first thing we always advise our clients that if they’re about to make major cuts or restructure their business, they need to be really clear about the purpose of the restructure and the cuts and what outcome they want to achieve,” said Daniel.

“People often just panic and go, ‘Let’s cut, we’ve got to rip costs out of the business’ but they aren’t clear about the purpose and what they’re trying to achieve.”

She said employers needed to be able to answer questions around what will be better about the new organisation and the new structure, what the business will be able to deliver that it can’t deliver in its current state and how the new structure is going to work.

Revisit your strategic plan

Businesses need to check whether their strategic plan will be impacted by the job cuts.

“People sometimes live in this beautiful world where they think you can take out half your staff and they’re still going to meet all the targets in the strategic plan. It puts impossible pressure on the organisation.”

Be objective when it comes to the new structure

Because restructuring and job cuts are deeply personal, Daniel gets clients to forget about individual employees when designing the new business structure and focus solely on how they want the organisation to work.

“Remove names and faces for a while and once you’ve got a structure on paper that you think is going to work, then start thinking about how it will work in practice.

“On a normal day, how would this structure work once you’ve taken X number of staff out and reorganised them? Then you look at names and skills and people and put the right people in the right box and try to do that in a fashion that’s as apolitical as possible.”

Have a definite timeframe

Try not to drag out the restructuring process as it is painful for everyone, said Daniel.

“As soon as you can provide certainty, do that and really communicate it. Make sure it’s treated like a project with a start and finish date, don’t let it drag on.”

Make sure the new structure is sustainable

Organisations need to make sure that the changes they make are sustainable, because having to go through the process again after a short period of time has a negative impact on morale and the top talent will start to jump ship, said Daniel.

Treat employees with dignity

Employers should make sure they have a strong communication plan and an employee assistance plan ready.

“Remember the human dignity angle. Think about how you would feel and how you would like to be treated and put services in place accordingly. Every now and then, we still hear anecdotes in the business world of people being told about a restructure via an email, saying it’s effective tomorrow. You can’t do that.”

Invest in rebuilding morale

“Once the restructure is bedded down, spend a lot of effort on rebuilding morale and celebrating what the future’s going to look like. You really have to love up the people who are left because there’s survivor guilt and all that sort of thing. Put money aside for it, invest in it. Don’t just think that everyone will go back to business as usual, because they won’t,” said Daniel.


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