How companies like Microsoft should handle mass layoffs

Microsoft to layoff employees

Microsoft CEO Satya Nadella speaks during his keynote address at the Microsoft Worldwide Partner Conference 2014 at the Verizon Center in Washington, DC, July 16, 2014.

Over the next year, Microsoft says it will be cutting up to 18,000 jobs, the biggest job cuts in the company’s history. The cuts are the result of the corporation re-aligning itself after it acquired Nokia in April.

Mass layoffs are very hard on workers, even the ones who are spared, but there are right ways and wrong ways to manage the process. We asked Sara Grant, adjunct associate professor at the Wagner Graduate School of Public Service at NYU and Robert Sutton, professor at the Stanford Graduate School of Business and author of the book, "Scaling up Excellence," for some thoughts.

Here are their suggestions about what managers and companies should do:

Set clear boundaries.

Companies need to be clear about how many jobs are getting cut, when people will know and how they will know. Rumors run rampant in times of uncertainty and it's important for companies to get out in front of the panic as much as they can. It's essential that companies honor these timetables, if they don't, there can be a feeling that the layoffs are never-ending.

Answer the question, "Why?"

Companies need to explain why the layoffs are happening and try to help people make sense of the situation.

Give people some control over the process.

Employees need to have some kind of say in the process and feel like their voices are being heard. Voluntary buyouts are one way to achieve this.

Treat departing workers with respect.

This is crucial. People in management needs to be in the office physically when layoffs are happening. They should be compassionate and present Hiding in their office during this time is not a good idea.

Provide laid off workers with support.

Companies should provide résumé help, wih other advice and support to employees who are leaving. Most importantly, they need to give workers a fair severance package.

Listen to dissenters.

There's often a temptation for companies to punish people who speak out during times of turmoil, but those conversations should be encouraged. Employees need to feel like they're part of the process.

Let people mourn.

Workers are saying goodbye to friends, lunch buddies and supervisors. They're often taking on more work. Be sensitive that the workers who stay will have mixed emotions and need support and time to process a big layoff.

Provide a clear vision for the future.

Employees need to feel like the company has direction. Do this by providing a clear vision to workers about where they are headed and where the company itself is headed.

About the author

Stacey Vanek Smith is a senior reporter for Marketplace, where she covers banking, consumer finance, housing and advertising.

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