Outplacement: controlled redundancy
There are various reasons why organizations decide to make their employees redundant:
- change in business strategy and resulting reduction of positions that are no longer necessary
- closing a branch office / offices
- merger or acquisition
- employees’ underperformance
According to the “Right Management” report (Manpower Group)1, 81% of European organizations who took part in the research said that one of the many criteria of a decision to offer employees outplacement services was the will to help them find new professional opportunities. It might seem that the only situation when outplacement services are not offered is when employees are made redundant because of their underpeformance. However, sometimes even then support is offered, provided that the employee worked at the company for a long time.
Challenges for the Board and HR Department:
- How to communicate layoffs to employees
- How to explain the reasons behind the company’s decision
- How to take care of the atmosphere and work planning and most of all, how to keep morale high among those employees who are staying in the organization
One outplacement definition says that these are “planned, comprehensive actions aimed at effectively handling the redundancy process and supporting dismissed employees in managing their new life situation2”. Three keywords are especially worth noting:
- “planned, comprehensive actions”
- “handling the redundancy process”
- and last but not least – “supporting employees”
Outplacement is not only about “ad hoc” help to the fired. It is also a complex program involving:
- the internal communication strategy
- carrying out the redundancy process
- supporting the board, HR Department and the functional managers in above mentioned areas
Outplacement and employer branding
Many employers who face the challenge of personnel reduction ask themselves: what should I do to carry out the whole process with the least negative outcome?
According to a survey conducted by Reed Consulting3:
- 78% of respondents claimed that outplacement can contribute to improving a company’s image
- 55% said that offering outplacement services can help a company to be perceived by their potential new employees as an attractive employer
Despite the will to help their employees, organizations which decide to provide outplacement services also want to:
- maintain a positive image as an employer that says, “we respect our employees and care about their future”
- avoid spreading bad reputation in their industry
- maintain good relations with former employees (networking)
- reduce the risk of potential lawsuits
- prevent a drop in motivation of the employees that are staying
Types of outplacement:
group or individual, online or traditional?
In principle, there are 2 types of outplacement:
- group outplacement for homogeneous groups of employees, e.g.: working in the same department or on similar positions; consists of group workshops on e.g.: navigating the job market, preparing professional application documents, interview preparation
- individual outplacement which consists of individual consultations in above mentioned areas
There is also a “mixed” version: after group workshops, employees would have access to individual consultations. There is a variety of options.
“Executive Outplacement” is worth mentioning as a variant of individual outplacement – aimed at managers and executives. Issues raised at individual consultations for executives are the same, however consultants working with management staff should be more experienced to be able to effectively support, for example a board member.
Thanks to technology firms can also decide whether their group or individual workshops are carried out in a “traditional way” (i.e. face to face) or “online” (e.g. via Skype). There are also some mixed forms, e.g. when a participant takes part in a workshop in person, followed by a consultation over Skype. Some companies use online platforms to support the job hunting process.
Companies can be assisted by a specialized freelancer, a boutique, a local or international company. There are also companies for which outplacement services are only a small portion of their turnover, as they normally focus on recruitment or HR consulting.
The price and quality of outplacement services depends on many different factors, not only on the company type. To choose a service provider that fulfills all requirements of the firm, it is best to answer the following questions that will then constitute criteria of evaluation:
From the participant’s point of view
According to the very definition of outplacement, despite the undeniable advantages for companies, the service is essentially about helping employees.
What do they expect from outplacement?
In 2016 a survey was conducted among companies in Poland1, which started or where about to start an outplacement program. The companies were asked about what their employees value / valued most in the offered services. According to Izabela Michaliszyn who summarized the results:
- 86% considered support in job interview preparation crucial
- 72% appreciated determining a job hunting strategy
- 66% stated that the assessment of their professional potential and emotional support were the key elements
- job hunting strategy
- next professional steps
- paths of professional development
- emotions connected with (upcoming) unemployment (and help in rebuilding undermined self-esteem which is often a result of being made redundant)
- the participant’s value on the job market
- market trends
- application documents (in various languages)
- presence on portals like LinkedIn, Xing, Goldenline
- content of application e-mails
- job interview simulation
- Assessment / Development Cente
- negotiating job offer / salary
- list of potential employers and relevant decision makers
- list of headhunters
Based on our own observations of the last 12 months, we see that:
- mid-level managers are also offered individual outplacement
- more and more modern / online tools are being used due to technology advancement
- the employees’ awareness is greater: instead of being ashamed of being laid-off, they actively ask for support in navigating the job market
- there’s an increase in the number of employers who tell their employees: “We have a budget of XX, you can choose the service provider yourself”. Sometimes the employer imposes a number of for example 3 companies which fulfill certain requirements. In such situation it is the employee who contacts different companies, has “casting” meetings and then returns with their own choice.
Would you like to learn even more about Outplacement Services? Feel free to read about our program.
Would you like to discuss your outplacement strategy with us?
Contact Bichl.Sandra@CareerAngels.eu to schedule a non-obligatory call.
1. Why Organizations Rely on Outplacement: A Global Perspective, Right Management (Manpower Group), 2014, http://bit.ly/2qTiYi9
2. Zwolnienia monitorowane (outplacement) jako przejaw społecznej odpowiedzialności przedsiębiorstwa, dr Beata Pituła, mgr Ewa Kaczmarek, mgr Halina Maruszczyk, 2008
3. The Value of Outplacement, Reed Global, 2006, http://bit.ly/2rCTjHJ