Looking after your people when times are tough

Wednesday 12 April, 2023

It’s easy being a good boss when business is booming. But what about when things are economically tight? What does it mean to lead well when the business is in trouble?

Two people who know about making tough calls while caring for staff are Heidi Walker, General Manager at Flight Centre, and Daniel Erickson, employment partner at Tompkins Wake.

During the pandemic, Walker was on Flight Centre’s executive team that downsized the company by two-thirds to survive. She was also instrumental in looking after their people during and after the drastic cuts. Heidi recalls the distress.

“There were lots of tears and a lot of anger, not just from the staff but also within the executive team. One thing we recognised is that you can't have an expectation on how someone will take bad news. Everyone's emotions are different, and you need to be with them wherever they’re at.”

Don’t do it alone

When tough decisions need to be made, leaders often know five to seven days before anyone else. That can be a lonely time, knowing that the coming actions will adversely affect the staff. When that moment came at Flight Centre, Walker was glad they’d called in Erickson and the Tompkins Wake team to help them through it.

“We had to take drastic action, but we didn’t have all the answers, which made things tricky. That’s when we called in Erickson to help us consider our options. His knowledge and support were fantastic. He gave us the confidence to move forward in the best way possible.

“Bosses often feel alone during those times, so my advice is to bring in an expert to help. It’s hard to support others when you’re not getting support yourself.”

Erickson remembers getting the call.

“Heidi and the team were trying to formulate a plan, but there was a little bit of shell shock when I first arrived,” he says. “I had daily conversations with them to help define the issues and outline the possible effects of various options. They made some tough calls, but they were the right calls.”

Communication is everything

No leader wants to be the bearer of bad news, but when job-impacting decisions are made, effective communication can make life easier for staff. In Walker’s experience, there are a few keys to communicating well.

“Transparency is essential. Good leaders don’t want to hurt their people but being upfront about a bad situation is a form of kindness. There’s a saying in boxing: ‘It's the punch you don't see coming that knocks you out’. Something like that is true when it comes to bad news in business. If you don’t forewarn your people of what’s coming, you leave them exposed. But if you tell them ahead of time, you give them a chance to brace themselves and prepare.”

Erickson agrees.

“Don’t sugar-coat things,” he says. “Leaders don’t want to demoralise their people, but if you withhold information, you leave them to fill in the blanks. Their minds will naturally go to worst-case scenarios which are often worse than the plain truth.”

Give clarity

When the economy slips, businesses are often forced to change aspects of their operation. That can be unsettling for staff. To help people adjust, leaders need to be clear about the nature of the difficulties and the rationale of the ensuing decisions.

To bring needed clarity, Flight Centre’s leaders explained the business dilemma with a simple metaphor. Walker explains.

“We created a PowerPoint slide with a bucket on it. We explained how much money was in the business bucket, and how much was going out each month. It was a powerful way of showing that we were leaking money and weren’t going to survive without taking drastic actions.

“The more you can break things down for your people, the less confused they’ll be. That won’t stop the pain that’s coming, but it will help them trust your leaders and keep the relationships intact.”

Front up & be authentic

In the age of texts and emails, it can be tempting to deliver bad news through a pushed digital message. While that makes things easier for the executive team, it does not demonstrate good leadership.

In tough times, people need the empathy of a real face and a real voice; they need their leaders to talk to them in person. From Walker’s perspective, this was something that Flight Centre got right.

“Our managing director got everyone together and spoke from the heart at the outset. He was clear and compassionate as he delivered the gut-wrenching news about the staffing cuts. He also made a promise that when the company turned around, our people would be able to return.

“If you make leadership promises, you must follow through. We did. I’m proud to say Flight Centre rehired 85% of our people.”

Be practical

Good communication is a crucial part of leadership, but it’s important to back the words with actions that help people navigate the new landscape. Flight Centre took practical support to the next level with Project Remedy.

“In Project Remedy, our leaders worked with over 200 businesses to get our people redeployed. We helped staff write CVs and prep for interviews, and we quickly delivered employment information to the businesses we’d contacted. Financial support and counselling were also part of the support.”

From Erickson’s legal perspective, the effort was superb. It’s never easy when you’re forced to reduce staff numbers, but Walker and her team prioritised leading with compassion.