Brave the Change in Retail and Avoid 4 Common Layoff Pitfalls
The retail industry is in flux. Once popular brands like Borders Book Store, The Limited, Hollywood Video, Sports Authority, and Circuit City have gone out of business. At the same time, big brands like Amazon and Apple are continually increasing their foothold in the traditional retail environment through industry-altering acquisitions and even establishing a brick-and-mortar presence in markets where competitors have closed their doors. For retail employers and their employees, more changes are on the horizon. From restructuring following acquisitions, shifts in the roles and goals of retail employees, and the necessity for reductions in the retail workforce, retail employees and employers are feeling the pressures of the massive changes in their industry.
On the bright side, retail reinvention is not just about acquisitions, layoffs, and store closings. If we look beneath the surface to what’s driving this change, it’s clear that technological advancements are playing a key role in the new face of retail. In fact, one recent survey by the National Retail Federation found that 48% of merchants say they increased their technology budgets in 2016 compared to the previous year.
Whatever the reason for the transformation, it’s vital for leaders and managers in retail organizations to be strategic about preparing employees for whatever changes are ahead. Start by avoiding these four common pitfalls.
Pitfall #1: Trying to protect employees from reality
It’s true, honesty is always the best policy. Talking about future layoffs—whether or not you know they’re going to happen—is challenging to say the least. You can’t always give all the details employees want to know. But it’s also not your job to protect them from reality; quite the opposite in fact. By being as honest as you can, sharing as much information as possible, and appropriating the information given the situation, you help employees deal with their new reality and overcome challenges.
Talk about change openly and remind your workers how the company has successfully navigated big and small changes in the retail environment in the past. Encourage individual conversations between employees and managers (open door policy) and focus those conversations on helping employees set individual goals for personal and professional growth. When employees know managers are approachable on topics like “what’s working” and “how do I improve my skills,” talking about organizational change won’t feel quite so out of place.
Lastly, be as open and honest as possible about what you know. If you’re allowed to share numbers about how your store or company is performing, encourage your store managers to communicate those details with the rest of the team. Open communication and transparency instills trust among workers and quiets the rumors and fear typically associated with anticipated change.
Pitfall #2: Waiting until it’s time for a layoff to show employees you care
If you wait to support employees until the time of notifications, you’ve missed an opportunity to help prepare impacted employees for their transitions and to keep remaining employees engaged in the days, weeks, and months leading up to and following workforce changes. Instead, support the entire employee experience and never wait until the onset of a layoff or workforce restructuring to offer your support. You can address these tough situations by making straightforward communication a part of your daily work culture, not just when an event is on the horizon. Proactively talk about the benefits the company offers, like outplacement services or job transition support, during the recruiting process, onboarding, training, and regular manager-employee checkins. Let your employees know you will take care of them while they work for you -- and should the nature of the relationship change -- you’ll take care of them then, too. Then, demonstrate your care and commitment while they work for you.
When managers give employees the opportunity to focus their energies in positive ways, it shifts the focus from anxiety about an uncertain furture to engagement with the tasks at hand. Work with team members to build the skills that will serve them in many different industries, even outside of their current roles. Begin these conversations by identifying the skills that make current employees successful in their individual roles, document them, and communicate your observations during short performance conversations. Sometimes, you might even need to walk a mile in the shoes of line-level employees as one Best Buy employee told Monster.com. By actually working with employees, or observing them directly, managers and store owners can keep the pulse of employee morale and work to keep team members engaged.
Taking skills and interest inventories of your current employees benefits your retail organization by identifying individuals who may make good managers, or fill other needed roles. In addition, skills inventories help employees to identify areas where they can grow and understand how their skills may be transferrable to other industries, should layoffs occur. Taking an interest in individual employees builds good will amongst those who may be impacted by changes in the future. Discovering and documenting employee skills and interests not only helps your workforce prepare for future opportunities, it also helps you build teams with the skills that will help your company move into the future of retail.
Grow your teams’ skills by identifying strengths and guiding employees to take on small or large projects that capitalize on their greatest skills and skill development trajectory. When employees know they are learning and growing in areas they’re passionate about, your organization will reap the benefits of stronger employee engagement.
Pitfall #3: Failing to equip your whole team
Think about your team holistically—what role will each of them play when the layoff is announced? It’s your job to help them proactively prepare. Floor managers should feel equipped to communicate efficiently and effectively with employees, no matter the situation. By working closely with the appropriate managers to encourge regular communication, HR departments can ease the flow of communication and improve overall company morale.
Understanding how the company or store is performing overall, as well as what steps are being taken to help ensure a healthy bottom line, will allow store and people managers to reduce anxiety and awkwardness when a layoff is pending. Reducing anxiety for managers and employees alike should be part of your overall communication goals during this time of uncertainty. Consistent and transparent communication is the key to a workforce that is motivated and productive.
During times of change, your managers might be wondering how they’re going to continue to deliver a high level of customer service with less employees, or even fear for their own job security. It’s vital that HR managers and company leaders are honest and transparent when communicating and creating tools like FAQs that address the real concerns of managers, supervisors and employees. Help managers focus on what’s right today, to live in the moment, and to look forward in a productive way to build success.
Pitfall #4: Thinking ‘this will never happen to me’
Don’t get stuck in the rut of thinking your business is exempt from layoffs. Instead of thinking, “this will never happen to me,” take the less comfortable approach and work with managers and store owners to practice your worst-case scenarios. Be sure seek the expertise of an outplacement provider when preparing managers for layoff scenarios to ensure you’re following the best practices and avoiding scenarios that may lead to legal action later.
Laurence J. Stybel, a career management and board adviser and an executive in residence at Suffolk University’s Sawyer Business School, suggested to Harvard Business Review readers that managers and those who would be in the position of delivering layoff news should actually role-play and practice worst-case scenarios. Stybel suggests thinking of all of the possibilities—such as a person invoking personal family situations or crying on the spot—and then practicing how to deal with those specific scenarios. He suggests that practice helps managers strike the right balance between showing sympathy and delivering the message.
The changes we’re facing across the retail industry will continue. Even Amazon, a company dabbling in the brick-and-mortar space, is switching up its strategy to meet new demand, largely driven by a dire need to offer the best possible customer service experiences and exceptional support. Customer service has always been—and will always be—the biggest driver of a positive and retail experience. Retailers that invest heavily in serving customers and putting them first will be the retailers that continue to win. The first step to solving the customer service puzzle, no matter what changes are happening across the industry, is equipping employees to recognize their value, deal with change, develop their skills and serve customers in the moment.