How ADKAR Improves Change Management for Layoffs

Effective change management for layoffs and reductions in force (RIF) is essential, no matter the reason for the change. Here’s how the ADKAR Model helps.

Whether your organization is reorganizing after a merger, laying off people to align with marketplace demand, or eliminating jobs for other reasons, the primary focus of change management for layoffs should always be on the people who are staying with the organization. This often seems counterintuitive.

Why Change Management for Layoffs is Difficult

Layoffs are never easy and the effects ripple throughout an organization. Some organizations provide departing employees with severance packages, job search resources, and other resources to help people move forward. But others don’t or can’t offer the same level of support, which makes change management for layoffs even more difficult for organizations.

Although Prosci research offers insights and effective approaches for implementing change management for layoffs and RIF, the process an organization follows is always highly dependent on applicable employment laws.

To understand the complexities of this type of change, let’s look at the different stakeholder groups involved.

Impacted stakeholders in change management for layoffs

Two primary stakeholder groups are affected by a layoff, downsizing, restructuring or RIF: the people leaving and the people who remain.

Stakeholder group 1 – The people leaving

Change management for this stakeholder group is especially challenging because you have little control or influence over their change journeys. In terms of the ADKAR Model, it’s almost impossible to build Desire for the change. Even when employers provide severance packages, job retraining, or other help, there is often no “What’s in it for me? (WIIFM) for people who are losing their jobs.

Human resources (HR) professionals must also manage layoffs and terminations in ways that align with strict legal requirements—which may seem abrupt. Employees typically get called into meetings without warning, advised of the separation and terms, and escorted from the building. In most cases, HR professionals can’t answer all employee questions. They can only focus on being compassionate, communicating clearly, and working within the organization’s constraints.

Change management for these stakeholders is limited and involves working with the HR representative. They collaborate to arrive at the definition of success, develop a communications plan, work through anticipated resistance, and confirm the appropriate responses to questions from departing employees.

Stakeholder group 2 – the people who remain 

Improving change management for layoffs is primarily about supporting the people who are staying with the organization. This group comprises smaller groups of stakeholders, such as front-line employees, managers, contractors, and customers impacted by the change.

These are the people who are going through an ADKAR journey you have more control over, as opposed to someone who’s exiting the business. This part of change management for layoffs focuses on planning for resettling the stakeholder groups who are staying after the layoffs are complete.

Supporting all relevant stakeholders is critical. You must do this right to avoid resistance behaviors, loss of employees and customers, and damage to your organization’s reputation and culture.

Getting Change Management for Layoffs Right

From a process perspective, managing change for a layoff or downsizing follows a similar approach to other types of organizational changes. Following a structured approach like the Prosci Methodology and 3-Phase Process goes a long way toward ensuring you address all the standard activities for achieving high rates of success. For example, choosing the right sponsor, which change management plans to use, the right communications and timing, anticipating and mitigating resistance, etc.

However, managing changes during layoffs and downsizings differs in important ways.

More focus on external stakeholders

Unlike internal changes, this type of change can have significant affects on customers and other external stakeholders. If the people who lost their jobs held customer-facing roles, communications plans must address those people. What are you going to say to the person or external vendor about what happened to the person or team they had always worked with?

Impacts to the organization’s reputation

Companies should be incredibly careful today in our world of viral communication. During layoffs, all eyes are upon the organization. How you treat your people in this moment will be remembered, and not just for the short run. People form lasting opinions from these types of interactions with a company.

Impacts on organizational culture

Change management for layoffs is a culture change, except it’s not a project or initiative most plan for. It’s commonly focused on reversing or mitigating negative impacts after a difficult change an organization goes through. If you think of a layoff as a tear or snag in fabric of the organizational culture, effective change management helps repair it. Otherwise, you can end up down the road, looking back and wondering, “How did we get here?”

Consequences of Poor Change Management for Layoffs

There are ways to get through layoffs and RIFs so the departing people feel a sense of dignity and you feel a sense of dignity for them. Conversely, poor change management for layoffs can result in a poorly or incompletely adopted change, or it may not be what your organization expected or hoped for. This is what Prosci refers to as the “Swiss cheese” state of a change.

States of Change

In change management, we always change for a reason. The intended benefits of a layoff might be more efficient reporting structures, better customer service, or improved financial position.

Like other changes, people in the organization must “adopt” or accept it to achieve success. When they don’t, consequences build up over time:

• First, you see short-term consequences like lower ROI from the overall initiative.
• Then, you might start to build a history of failed changes over the next year or two.
• And then it's usually somewhere around year 3 to year 5 when people look around and say, “This is not what our culture was like.” “We didn't expect this.” “We used to be a great company, and now I don't know who we are.”
• Eventually, people start to think, “If the company is going to treat people like that, I should get out of here too.”
  
  

Research on Poor Change Management for Layoffs and RIF

Prosci research reveals significant consequences from poorly managing change after a layoff. Things to look out for include:

• Fear – Retained employees fear losing their jobs. They’re less likely to take risks because they fear mistakes. Employees are also much less likely to embrace the change because they don’t want to be seen as embracing layoffs.
• Productivity loss – A sense of futility spreads among employees because they see themselves as the next to be let go. High performers quit for fear of losing their jobs, often going to competitors, and leaving teams without the needed knowledge and expertise.
• Absenteeism – Employees don’t show up to meetings, activities or events related to the change and everyday work. Some begin using all their paid time off. Organizations may see a spike in sick days claimed during the change.
• Working against change – Employees may undermine the change or retaliate by sabotaging it or spreading misinformation. This makes others feel guilty for supporting the change

4 Tips to Improve Change Management for Layoffs

To address typical issues present during layoff-related changes, start with the first two elements of the ADKAR Model: Awareness and Desire.

1. Deliver abundant communications 

Prosci research shows that near-constant communication about change quells rumors and improves Awareness of the need for change. Impacted groups are prone to speculation about change. Transparent, frequent, well-timed communications from the right senders will ease fears and mitigate negative views.

2. Address stakeholder concerns

Employees and other stakeholders are more accepting of the change when you listen to their concerns early in the process. To build Desire to participate and engage with the change, address concerns promptly, efficiently and articulately whenever possible. Don’t downplay negative implications or try to make the change sound better than it is.

3. Communicate the business need for the layoffs or RIF

Employee groups should understand the business need for the change. Although layoffs affect employees negatively, clarifying that the change was not superfluous is important for building Awareness and Desire.

4. Don’t rely on communicating individual benefits

Our research shows that it’s difficult to convey individual benefits—or WIIFM—when trying to build Awareness and Desire. The reasons for why a layoff or downsizing is necessary may appear to produce only organizational benefits (whether true or not). This complexity compounds when your communications lack transparency, leading to employee mistrust of managers and leadership, especially when they appear to benefit from the change.

Navigate the Complexities of Change Management for Layoffs and RIF

 The Prosci ADKAR Model provides organizations with a path forward through challenging layoffs, downsizing, reorganizations and RIFs. When you use it to focus on the employees and individuals who are staying, it’s a guide for maintaining organizational integrity, morale, and ultimately, success during the transition. By adhering to structured approaches like the Prosci Methodology and 3-Phase Process, organizations can better support all stakeholders involved, ensure a smoother transition, and foster a culture of transparency, dignity and respect.