Restructuring and Economic Bumps – When is the right time to talk to staff?

Restructuring can be an exciting part of growth and opportunities, but let’s face it, most of us are more familiar with it from the other side of the economic equation – the downsizing process. Economic downturns often necessitate such restructuring efforts.

So, when is the right time to talk to staff if business isn’t going so well and you're facing tough times?

The answer is, right now.

In fact, you should be talking about and sharing your goals/targets and business strategy since the first day each of your employees started. Ensuring regular communication during difficult times is crucial.

Economic bumps can require us to examine the economic impact and future for our businesses. Restructuring could be something you need to consider. But whether you’re riding the economic highway or about to pull up on the hard shoulder, now is always the best time to discuss your business with staff and let them know how things are trending. Good, bad, or downright ugly!

If your company is experiencing tough trading conditions, you may need to consider cutting back on costs, business operations might need to be streamlined to maintain efficiency, or you may have to make the difficult decision to make some redundancies. 

The possibility of redundancy can be a shock and extremely demoralising for staff, significantly impacting employee morale, whether they have seen it coming or not. But if they can see it coming, they’re more likely to be able to support you if you include them in discussions, whatever the outcome. Employee engagement during such discussions is key.

Knowing how much to share with staff can be difficult too. Nobody became an employee to worry about your cash flow and how you’re going to pay your mortgage. It sounds harsh but, that’s why they’re employees and you’re the boss! 

But knowing what your company targets are, your values and your strategic direction is a must for any employee. After all, if you’re the boss and you haven’t spent the time to tell your staff what your expectations are from them, how are they supposed to know what you need?

Being too busy and just allowing organic growth to occur without strategic direction during times of economic boom will often lead to a restructuring when the economy hits a bump, contributing to stressful times.

So, if you’re about to negotiate a tricky economic patch with your business, and you haven’t done so already, talk to your staff now. Let them know what your plan is to navigate these treacherous waters and what you need from them, to avoid the need to restructure where possible. During times of uncertainty, clear communication about the business situation can alleviate concerns.

Sharing your company goals and how you expect to get there will help increase the engagement of your staff, even if you’re only talking about how to get pay raises rather than the scary restructuring stuff.

There is no “I” in team.

Business ownership can be a dark and lonely place, but you have never had to do it alone. Talking to your staff early can help chase the wolf from the door, increase engagement, build resilience in your staff, provide pivoting opportunities with unutilized staff skills, and increase your staff loyalty. Fostering a strong company culture during uncertain times can lead to better employee morale.