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  • Lisa Thrive

“We have to make some changes to our business…”

Updated: May 5, 2022

With COVID-19 creating unparalleled changes to the way most of us live and work, many organisations have already had to significantly alter the way they organise or operate their businesses. During this period, I’ve been reminded of some great advice I received during a previous crisis event, “you will be judged by your response to the event, not by the event itself”. Thoughtful planning about the way to lead during a crisis will have a direct connection to your business’ adaptation and survival. To help leaders we’ve created an approach, Leading Change with Empathy, for those times when you are faced with making difficult organisational change decisions, to ensure decisions are designed and carried-out with empathy, and that your decisions work to ensure the sustainability of skills and talent into the future.

An important note: please keep in mind that the following information has been prepared to help business leaders make change with empathy, it is people strategy advice, not legal advice, and we recommend that you obtain legal advice before making any employment-related changes.

1. Why do we have to make changes?

The leaders we work with who have successfully managed forced change highlight three essential elements. Firstly, they have thoroughly assessed their business situation, know why they need to make changes and have a clear set of values to guide them. Secondly, they know their people, understand their perspectives, are ready to involve them at every stage, and to use their peoples’ input to guide the change process. They don’t let people feel like change is being done to them, they help them to understand the need for change and how they can have a role. Thirdly, these leaders communicate clearly, consistently, and often. They are open, tell people as much as they can, freely acknowledge people’s fears, and provide everyone with the same information.

Leading organisational change with empathy means that you want job losses to be a last resort, and that if retrenchments are inevitable they will be done supportively. To create your change with empathy plan:

  • Analyse your business and describe the reasons for having to make changes – has there been a dramatic fall in work or in revenue, is the business unsustainable in its current form, have costs escalated unexpectedly, are some services no longer needed, does work need to be reorganised to more effectively meet client needs?

  • Build your key message/s. Describe what has happened (e.g. we’ve had a sharp drop in client demand), why change is needed (e.g. there isn’t as much work to be done at the moment), your intention (we want people to keep their jobs), and what will happen next.

  • Look at all of the possibilities and alternatives to safeguard jobs. How creative can you be? Ask your people – what are their ideas, what do they think could be done?

  • Where do you want the business to be post-crisis? Have you carefully considered this in your analysis? Will the options provide for this?

Once you have a clear view of the situation, you can assess your options.

2. What are the options?

In this period of extreme uncertainty, one thing is clear – as a business leader your role is to take responsibility to lead others through the challenges. After the GFC, the businesses that were able to rebound quickly were those who had worked to prevent job losses. This stability meant they had the skills and talent in place when demand returned, and they were more resilient in the new environment.

To decide the best option/s for your business first understand the following fundamentals:

  • What is the basis of each person’s employment with the organisation – the minimum standards under Fair Work Act, an enterprise agreement, an employment contract or a modern award? Each will have different conditions and requirements regarding how to make employment changes. Obtain legal advice if you are unsure.

  • What are your customer/client’s ongoing needs? Has the pipeline slowed, have payments slowed? Consider whether you have a cashflow, or a workflow issue.

Now consider the change options:

  • Is a reduction in hours, e.g. moving from full-time to part-time the way forward? For some roles or all roles? If the work volume is still high can you smooth it out over a longer period?

  • Is a reduction in pay the way to achieve the outcome? What is the required magnitude? Will it be applied equally or differentiated, e.g. more senior employees may have a higher pay reduction? Also consider whether this can be achieved having regard to the basis of each employee's employment.

  • Is leave an option? Paid leave may depend on your cashflow, but unpaid leave may be welcomed by some employees to provide a return option when business improves.

  • Can you make other cost reductions to minimise any organisational changes? Your people will be a very helpful source of ideas here.

  • If you are faced with no alternative but redundancies, think compassionately; are you absolutely certain that you can’t amalgamate or change roles, provide other support, or work? As for stand-downs, legal advice ought to be obtained first.

It is essential to remember that changes to employment terms are a contract variation and need the employee’s agreement. Legal advice should be sought first.

3. What does leading change with empathy look like?

Great leaders have empathy and provide supportive leadership that deeply considers the perspectives of others. Empathy isn’t sympathy and doesn’t mean the leader solves all the problems. It means leading change from the position of how it feels to be the other person/s in their shoes. How you treat your followers will be a model for how they treat others, your clients/customers, and your suppliers. A collective approach to empathy will also help to sustain your business in the long term. “Compassion goes a long way during turbulent times” was a neat summary of leading with empathy that I came across last week.

The following actions are all part of leading with empathy:

  • Act with decisiveness, urgency and honesty. People look for certainty and clarity in difficult times and appreciate honesty even if it means saying you don’t have the all the answers.

  • Communicate with your values, describing what you stand for / don’t stand for (e.g. keeping people in jobs is important / redundancies are a last resort).

  • Demonstrate an equitable approach by example (e.g. if reductions to working days or pay are required show they have been applied equally or fairly).

  • Show that you are genuine about leading with dignity, respect and fairness throughout your organisation, to your suppliers and clients/customers as well as your people.

  • Understand where your people are at by regularly connecting with them and showing a focus on understanding their health and wellbeing needs.

  • Find a personal way to thank people for maintaining their focus on work, especially at the end of the crisis. Some leaders write personalised notes, others find personalised gifts. Identify the unique way that you can truly show your gratitude.

  • Be ready that it might affect you. It can be extremely difficult to lead high-impact change so ensure you have someone who can help you through it too, after all you’re only human.

4. What does clear, direct and helpful communication look like?

Two things I’ve observed throughout periods of intense change are that when there are information gaps, people will try to fill those gaps with speculation and guesswork, and that consequently, there’s no such thing as over-communication during change! It is natural for people to look for clarity and certainty, and they will do that themselves if leaders don’t provide it. There are many great resources that are available to help leaders build their messages, so the following is provided as a quick reference.

Before you talk with people, or hit the “send” button, have you:

  • Described the big picture / aim in clear terms?

  • Outlined what success will look like?

  • Set out scenarios – e.g. “if this, then this”?

  • Been as open, honest and transparent as you can possibly be?

  • Provided detailed explanations the impacts, the benefits, any pre-requisites?

  • Committed to constant, candid, updates?

  • Removed anything from your messages that looks like blame or punishment?

  • Planned for face-to-face communication where it is possible, or appropriately timed remote channels where eye contact is not possible?

  • Given people an opportunity to provide input, or committed to an “Ask Me Anything” session, or sent a detailed FAQ (or all of these)?

  • Offered additional counselling, wellbeing or other useful assistance such as a dedicated and confidential internal contact?

  • Offered your help without make any over-promises?

  • Thanked people?

Checking in regularly with your people will enable you to understand their perspectives, concerns and fears. Acknowledging these will enable you to clearly communicate the important information people need. Together, this will provide for a more engaged focus on the work to be done and contribute to a more resilient response to unanticipated change.

5. Planning for the new normal

The COVID-19 crisis has disrupted almost every aspect of our work and life. Disruption is a process that works to displace the current situation and replace it with something different. Leading change with empathy means that you will already be considering how you want to manage your people through this disruption into the new normal future in a way that considers and includes them.

Whilst none of us can predict with certainty what it will look like afterwards, we can be thinking about the following elements to be ready:

  • What do you consider to be the essential and core skills for the future? Will you be well positioned, or need to re-skill people? Will the change be temporary, or longer-term? Is this reflected in your current BCP, or does it need modifying?

  • Are the current structures and employment conditions fit for the future? What needs to change?

  • Are your policies, processes and practices durable – a recent Gallup report showed that 59% of employees want to retain their flexible working arrangements after the crisis is over. Similarly, will virtual meetings replace travel in your business?

  • What will be the affordable ways to engage and develop people and continue to invest in them – mentoring programs, work wellbeing initiatives, transferrable skills programs?

Taking some time throughout this period to reflect on and record the learnings (what’s worked well, what are the gaps, what are the systemic issues that have emerged, what are the unexpected positives?) won’t provide the answers for post-COVID-19 but will enable you to swivel more quickly into the new.

In March I wrote that I could see leaders responding and adapting very quickly, click here to read the article. I’ve continued to observe this response. What I’m also seeing is leaders thinking about the impact on their business and the impact on their people equally. Empathy and compassion on this scale is a new, and tremendous response to see in action and one that can only lead to better, more fulfilling work-lives. Great leaders – you have got this.

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