Rightsizing Your Workforce In the Face of Economic Change - TalentCulture

Rightsizing Your Workforce in the Face of Economic Change

Businesses everywhere are still grappling with tremendous change, as pandemic aftershocks continue to roll through the global economy. Although most Covid-era restrictions are behind us, organizations large and small are still dealing with significant people-related issues. Workforce capacity planning is just one piece of this complex, multi-faceted puzzle. But if you’re an employer, rightsizing your workforce has likely become one of your top priorities during these turbulent times.

One of the most serious repercussions of the pandemic involves talent — or the lack thereof. Companies aren’t able to hire enough skilled workers to meet their operational needs. This inability to attract and retain qualified talent — coupled with inflation — is driving compensation higher. In fact, according to the March 2023 U.S. employment cost index, civilian wages continue to increase, up 5.0% over the past year. And depending on the industry, some workers are asking for even more.

This means employers are having to get creative when attracting and sourcing talent. For example, some are focused on rightsizing their workforce to maintain operational efficiency while qualified workers are in short supply. And many companies are downsizing and upsizing simultaneously, as they adjust to continuously changing industry challenges and trends.

Effective Workforce Rightsizing Isn’t Only About Efficiency

For numerous organizations, workforce rightsizing involves reliance on contingent workers. This can be a smart choice. Contractors and temporary workers often provide the flexibility needed to operate efficiently and effectively, even when market demand shifts or business priorities change. This strategy is also attractive because it helps protect internal employees and their core responsibilities.

Even so, a flexible workforce might not be enough to weather a negative business cycle. It may also be necessary to make the difficult decision to lay off existing employees. Obviously, the most challenging aspect of downsizing is deciding which employees to lay off.

Is it best to make these decisions based on individual performance? What role should seniority play? And how can you be sure your remaining team will have the skills, knowledge, experience and motivation to sustain your business through tough times and support future growth?

If layoffs are followed by a hiring freeze, there’s the additional question of how to retain remaining employees. What will you do if critical contributors decide to resign? The last thing you want to do during a business downturn is jeopardize a product launch, revenue goals, or customer experience.

It’s important to recognize that drastic workforce adjustments can trigger problems with stress, morale, and engagement. Naturally, staff members who aren’t laid off are likely to soon wonder, “Is more bad news on the way?” or “Am I next?”

Even in an era known for record levels of voluntary resignations, job loss is foremost on employees’ minds. In fact, it is the top concern among 85% of people, according to the Edelman 2022 Trust Barometer. Concerns like this can prompt even the most loyal team members to start hunting for a new job. And without proactive intervention from leaders, this kind of “flight” response can spread and upend your organization’s efforts to regain stability.

Rightsizing Your Workforce: 4 Key Strategies

When rightsizing your staff, finding the right balance isn’t easy. It’s even more difficult when you need to downsize one department while upsizing another.

You can certainly be upfront about your intentions — and you should be. Transparency and clear communication are essential when managing change. However, you can’t afford to lose sight of the fundamental challenge every organization must face. You must determine the best way to anticipate and respond to potential business fluctuations. Here are a few ideas that can help:

1. Include Contingent Workers in Your Plan

By definition, contingent workers serve as supplements to your core employee base. They generally work on a project-by-project basis. As such, adding contingent workers to your plan offers significant flexibility when rightsizing your team becomes necessary.

In fact, 63% of organizations told SAP Fieldglass that contingent workers enable greater organizational agility. What’s more, 62% believe contingent workers are essential for filling key IT and digital skills gaps. For example, when companies experience a sudden influx of work, they can call on this scalable talent pool for quick access to the right capabilities.

2. Be Strategic About Any Hiring Freeze

When initiating a hiring freeze, one of the biggest mistakes companies make is to halt all recruitment activities and contingencies, entirely. It’s important to continue hiring-related processes. This way, when the need for additional help arises, you can more easily pick up where you left off and maintain operational continuity.

Even if incremental roles are temporary, you’ll be better able to tap into the skills needed to support critical business objectives. In fact, 61% of companies told SAP Fieldglass that contingent workers help accelerate their speed to market. In other words, relying on flexible staffing can actually help you continue to scale during a hiring freeze.

3. Treat Skills Development as a Long-Term Investment

Don’t be shortsighted about talent recruitment or development. Focusing only on the skills you need now can leave you scrambling to fill critical roles down the line. In addition to the skills and competencies you need today, emphasize what will be essential for your business in the next few years.

Investing in professional development also gives you a chance to leverage learning and growth opportunities in your recruitment efforts. It can help your job openings stand out in today’s environment, where jobseekers value employers that emphasize learning and career advancement.

4. Leverage a Talent Marketplace

Essentially, a talent marketplace is a system that helps employers align talent with open roles. It can work one of two ways:

  • Internally, you can use this kind of system to facilitate employee mobility, helping individuals pursue different roles based on their skillset. Or you can redefine and reorganize an employee’s existing role so it better aligns with your organization’s changing needs. This process can be especially helpful during a hiring freeze.
  • Externally, a talent marketplace can help organizations open the door to freelance, temporary, or gig workers who are qualified for hard-to-fill roles. Think of it as creating a larger, more agile talent pool that lets you secure the right skills at the right time, while saving costs typically associated with recruiting and hiring internal employees.

Final Notes on Rightsizing Your Workforce

Pandemic aftershocks are still reverberating through the business world — and organizations will continue to be disrupted by unexpected external factors. As a result, smart employers are staying open to more agile workforce planning and management strategies.

Today’s successful employers are already rethinking the way they recruit, hire, manage, lead, compensate, and redeploy talent. Rightsizing your workforce is just one piece of this larger puzzle, but it can make a significant impact on your organization’s long-term success.

restarting stakeholder engagement

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Restarting Stakeholder Engagement: 8 Questions Leaders Must Ask

As we look ahead to redesigning the post-pandemic workplace and re-establishing business relationships, stakeholder engagement will once again be one of the more critical aspects of leadership. After all, many of your stakeholders — anyone from your frontline employees to suppliers to business partners — have been working remotely for the past 15 months. And many companies have found that engagement has taken a back seat to “just get the work done.”

As you seek input to re-engage with employees and customers, there are many advantages to identifying and getting to know your primary stakeholders. There are also distinct disadvantages if leaders do not engage with them. After all, any failure to understand their needs can lead to blind spots for managers and executives. Those blind spots often lead to disastrous outcomes, such as low employee morale, lost opportunities, or a disappointing bottom line.

Fortunately, as we work toward restarting stakeholder engagement, we can use research-based strategies to notice such blind spots —and overcome them. But first, leaders must identify their key influencers

Identifying Your Key Influencers

You might be inclined to begin restarting stakeholder engagement with all your stakeholders immediately. It might be tempting to address the concerns of all of them, all at once. Resist those temptations.

As many leaders have already learned, it is much more practical to focus on the most important relationships. For most leaders, especially those that have also been working remotely, this means sitting down with your leadership team. Your goal: To generate a list of stakeholders that most impact your organization. These are your key influencers.

Perhaps you don’t know who your key influencers are at the moment? As you work to identify the stakeholders you should engage with first, consider these three things:


Key stakeholders significantly impact your company’s growth. Or perhaps they greatly influence the thinking of co-workers, entire teams, or consumer groups (like you’ll see in the example below). The long-term success of your company hinges, in large part, on a successful continued relationship with these high-impact individuals. By default, they are considered key influencers.

Past Performance

Based on past performance or future business potential, your company cannot easily replace some stakeholders. Chances are, your leadership team already counts on these people, teams, or companies in many vital areas of the company. Collecting input from them might mean the difference between a continuing relationship — or not.

Mutually Beneficial Relationships

Typically with key influencers, the relationship between the company and the stakeholder is mutually beneficial. You can clearly identify the value the stakeholder brings to the company and vice versa. Your organization’s goals and desired results align well with their goals. As these influencers meet those goals, so does your company.

Restarting Stakeholder Engagement: A Case Study

I recently sat down with a coaching client, Bill — a healthcare entrepreneur leader looking to re-engage with key stakeholders. After a year had passed since they communicated about a launch initiative vital to his company’s success, Bill and his leadership team wanted to encourage the widespread adoption of their innovative medical equipment.

Throughout the pandemic, the initiative had failed to gain sufficient traction. Bill suspected that it might be due to the higher cost of their medical equipment. His first instinct was to do one-on-one outreach to key influencers in this business sector, especially those advocates in patient groups. Bill approached me after preparing a list of more than 40 key influencers. As you can imagine, he was having difficulty developing a strategy that would allow him to address each of them. Time wasn’t on Bill’s side. Because he needed to present his findings and results in an upcoming meeting with investors, he felt immense pressure.

When I checked Bill’s list, I noticed a wide variety of potential influencers, including many who did not have key decision-making roles and therefore had no direct impact. There were also people on the list whose past performance could not be readily determined and who Bill couldn’t definitively place in the “mutually beneficial” column. Ultimately, we pared his list down to eight key leaders who demonstrated all three attributes above. Because they had many similar concerns and priorities, Bill was much better able to engage each of them in a meaningful way.

For Each Key Influencer: Ask 8 Questions

Now that you have your key influencers identified, and regardless of the urgency, you might feel to begin re-engagement immediately, do a pre-engagement check. Otherwise, you might fall into the dangerous judgment error known as the false consensus effect. This refers to assuming other people are more similar to you and more inclined to do what you want them to do than is really the case. To avoid false consensus, ask these eight questions:

What are their feelings, values, goals, and incentives around this issue?

Bill’s key influencers — the eight leaders of patient groups — were willing to try a better product. However, they were wary of endorsing more expensive equipment. Or at least without being able to justify the higher price point to their respective patient groups.

What is their back-story around this issue?

Bill’s key influencers wanted to find the best equipment to endorse to their patient groups. Yet, they were cautious due to several substandard products they have tried in the past.

What is their identity and sense of self as tied to the issue?

The leaders of the patient groups take their responsibilities very seriously. For example, they tirelessly keep up to date with the latest research and equipment available.

How are they the hero in this story?

Bill’s key influencers are on the frontlines when pushing for a better quality of life for their patients. Most of them have been directly or indirectly affected by the medical condition the equipment seeks to address. They want to be part of the solution.

Why should they want to listen to your message and then become advocates?

The leaders of the patient groups will benefit from hearing Bill’s take on the product’s efficiency. As the head of his organization, his message comes with a high degree of credibility. The key influencers can share Bill’s message with confidence.

What might prevent them from listening to your message and taking action?

If Bill confirms that the medical equipment’s higher cost is the main point of contention, he needs to address this issue. Otherwise, the key influencers may not listen to anything else he has to say.

How can you remove any obstacles so they are more apt to listen and act?

Bill decided that he will immediately address the price issue in his meeting with the key influencers. He planned to discuss in detail how his organization’s innovative medical equipment was the best choice in terms of quality and warranty.

Who do you know that can give you helpful feedback on the answers received?

I connected Bill with Jolinda, for over a decade the leader of a well-organized patient group. Her group represented the interests of patients with different medical conditions not relevant to the equipment made by Bill. Still, after reviewing the answers to the previous assessment questions, she was willing to share her perspective as a key influencer. Your job: Find your “Jolinda.” Or two. Or three.

Re-engagement: One Stakeholder at a Time

Your organization’s relationship with your stakeholders will change over time. You will face different issues at varying difficulty levels. Regardless, you must learn how to identify your key influencers and perform a pre-assessment check before engaging with them. By doing so, you will be able to commence restarting stakeholder engagement successfully.


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