The ITS Top Talent Newsletter • March 2002

Employees Suffering From Corporate Depression: Managing the Effects of Mergers, Acquisitions and Poor Profit Results

By Dr. B. Lynn Ware, President and CEO,
Integral Talent Systems, Inc

Like sudden air turbulence, the fast decline in company profits last year, combined with layoffs and an increase in company mergers and acquisitions, has caught the corporate workforce off guard. Pumped up by the low unemployment rates and generous corporate perks of 2000, many workers are suffering from corporate depression and shock.

Depression is often caused by loss, and these workers have lost plenty. Opportunities for professional growth are practically nonexistent as corporate training, travel, and convention budgets have all been cut. Forget about career advancement, since there are few open positions available. Exciting, new and interesting projects have been postponed or cancelled. Co-workers have been laid off. And perhaps worst of all, wariness and suspicion of senior management has set in. In the absence of a visible strategy and information, employees are wondering: "What are they going to take from me next?"

The Nov. 7, 2001 issue of Business Week predicted that most company performance improvement in the first half of 2002 will come from productivity gains instead of new hiring. How will this happen, given the current work environment? Quite simply, optimal performance and discretionary effort do not come from depressed workers. What can employers do during this difficult time to motivate employees and capture the productivity gains that are needed to bring the company out of a funk this year?

Our forward-looking clients are already laying the groundwork for the Summer 2002 economic recovery: they are using the interim to build trust with their employees so that they don't run out the door the next time they have the opportunity for employment at another company during the next upswing.

What should employers do now?

• Overcommunicate. In the absence of information, employees will often make it up. At a minimum, be sure to communicate your short-term business strategy and your hopes for the future.
• Give managers communication tools and support. Managers need to speak comfortably with employees about what their needs are at work right now. Most managers either do not take the time to do this, or are uncomfortable having these types of discussions with their employees. However, these discussions are necessary to build loyalty and trust and get the employee through this difficult period.
• Empower employees. Employees need a safe work environment to ask questions and speak comfortably with their managers about how to improve their job satisfaction during these difficult times. Often, small gestures such as an additional pat on the back or positive feedback can go a long way in getting performance from an individual who might otherwise be feeling neglected, since management is so focused on other things.
• Get a read on how your employees are feeling. Take the pulse of the employee organization via employee commitment surveys, so that metrics are available to tell you what employee initiatives you should focus on throughout the year that will improve morale and bolster worker productivity.