Dealing with Layoff

1. How to Avoid Layoff
2. Preparing for the Worst
3. How to Survive from Layoff

In IT industry, layoff is inevitable. Most likely, layoff has nothing to do with employee's job performance but often caused by uncontrollable external situations. In such a highly competitive environment, companies were sometimes forced to reduce workforce due to economic conditions and business operation problems. Layoff is often a result of company reorg, merger and accusations, and so forth.

As IT pros, a lot of us had been handed the pink slip or at least see co-workers let go. Layoff is one of the most frustrated career challenges we have to face. The pressure, frustration, and emotions could impact our career negatively for long time. To avoid career damage from layoff, we offer you the practical tactics that you can apply easily in you work. By using these tactics you can often skip layoff, or recover quickly if it does happen to you.

1. How to Avoid Layoff

While no one is immune from layoffs these days, those who have built stronger career base have more power to fight back. A strategic career base includes positioning, qualification, and affinity:

  • Positioning: If you can dynamically position yourself in work environment, you can somehow exclude yourself from layoff, or defer it to win time.
  • Qualification: Qualification delivers value. Those who were valued high have more fighting power.
  • Affinity: Never overlook the power of affinity that derives full-dimension network of strategic relationship across all levels, layers, and boundaries in your workplace.

Career base cannot be built overnight. It takes time and it is a continuing process. If you were not aware of it before, it is now the time to evaluate how strong your career base is and how to enhance it. So, let's discuss a few applicable tactics to reinforce your career base by improving your positioning, qualification, and affinity. With these improvements, you have much better chance to beat layoffs.

Becoming a key player

You must work as a key player within a team, project, division, department, or the entire company. Key players work on systematic projects instead of isolated assignments. Key players are often involved in design, architecture, and systems. For instance, an application architect and a database administrator could be the key players in a project. If you are just one of the low key programmers in the development team, you may be laid off easily because your work can be replaced or transferred without impact the overall project. However, if you are a key person in system design and data architecture, it is not that easy to let you go unless the company is out of business.

As you can see, this tactic contributes positioning and qualification to the career base.

Showing your value

Do high quality work, complete project under budget, always meet the deadline, show your company how much they need you, then that job was made for you. If necessary, put additional effort and your own time to your work. Keep learning new skills and enhance your experience.

Enhancing visibility

Visibility is about positioning. Our research shows that highly visible employees are not easily to be targeted in layoff decisions. It is understandable that people of high visibility have greater influence on the team and environment, thus the management would rather leave them alone in order minimize the impact of layoff.

It is fairly easy to increase visibility in work place. Work harder than you have ever worked especially layoffs are on the way. Be the first to come and last to leave. Let everyone see your commitment dedication to the company. Make a habit to take every opportunity to stand out from the crowd. Talk to people often and make them know you. Show your interest on what others are doing. Always offer help. Provide suggestions the management. Prepare yourself to make impressive speech in meetings.

Acquiring business knowledge

It's not enough to be good at technical details. You must learn how the business operates and know your company inside out. Your business knowledge builds more qualification and adds more value on you. Also, with enough business knowledge you can see the whole picture of the company and can identify problems and threats at the early stage, thus you can prepare and make quick response. For instance, when you see the development division where you are working may be eliminated due to out-sourcing, you may find a way to transfer to system support division that will be kept in house.

Acquiring business knowledge is easy. What you should do is pay attention to how the company's business works. You should also build a wider scope of contacts within the organization. Try to know people in different departments and divisions, and learn what they are doing.

Building personal relations with decision power

When you get into a work place, you need to quickly identify who are among the decision power. Most likely they could be your boss, your manager, or supervisor. For sure you must build good working relationship with them, but that's not enough. Going one step further, you should try to build personal relations and make friends with them. Once you become friends, personal relations will be intuitively factored in for decision making and you will be protected by your friends. That's the power of affinity.

This approach is not easy to everyone. Fortunately, there are many books available to teach you how to create successful relationship with all kinks of people.

Offering compromise

When layoff seems unavoidable, don't just wait for fate. It is the time to communicate with the management and do whatever you can to influence their decision in your favor. In this case, the most effective way to defer layoff is to offer compromise solutions.

What you need to do is to talk to your management team and discuss the layoffs openly. First you should express your understanding of the company's situation and show your support to the management's decision for saving the business. Then you could offer comprise solutions such as voluntary pay cut or unpaid time off as an effort to help company through the difficult time. During the discussion you may review your past achievement with the company and demonstrate your commitment to help the company and the management term by personal sacrifice.

This is an effective strategy of positioning. In most of the time, this could truly impress your boss thus eliminate or defer your layoff. Smaller paycheck is better than no job. More importantly, you win the time to prepare for the next move. In general, an offer of 15% pay cut or one week unpaid leave per month would be sufficient enough.

2. Preparing for the Worst

Layoff can happen to every employee, however most of us do not think about that possibility until we are actually laid off. Don't let layoff turn you down, prepare it ahead and keep you career move. To make yourself prepared, you must be able to sense early signs before layoff happens; you must have a financial plan to cover the worst situation; and you must make yourself ready to jump onto the job hunting boat.

Watching for early signs

Stay alert in the workplace so you can sense early signs before mass layoff announcement. That can give you precious lead time to maneuver your career. Specially, pay attention to the following events in your company:

  • HR policy and rules change: An announcement of hiring freezes in either your department or companywide is definitely a bad sign that indicates a problem in operation and profitability. The next logical would be the cut of head count if the problem cannot be solved soon. Other policies, i.e., new rules in regard to vacation or internal processes such as expense reports could also indicate potential problems within the company.

  • Stock performance: If you work for a public trade company, then your company's stock is a good indicator to signal problems. Layoff is near if you see sings such as (1) Stock price declines consequently for more than 6 months, (2) Stock has been on the "strong sell" list for the last quarter, or (3) corporate earnings have been flat or declining. You can check out your company's filling report to find out more about its financial situation.

  • Company re-org: Over 90% of re-org results in down sizing, elimination of divisions, and outsourcing, and of course, layoffs follow. As early as possible, you should assess how re-org could affect your job, project, and division. If your position would be affected, you should start to look for transfer within the company or outside opportunities.

  • Merger and acquisition: If your company is planning to merge with other company, acquire other company, or be acquired, then watch out your job. Merger and acquisition create redundant functionalities that often results in multiple people for one position. Since a team effort to complete one person's job is not necessary, layoffs will happen.

  • External changes: Changes in external environment could lead to your company's layoff. These changes include national economic conditions, up and down in industry sectors, business development in certain geographic area, and world wide competitions. So stay alert and keep on top of trends.

Financial Preparation

The significant impact of layoff is financial disturbance. It gets worse if you have a family and are the primary wage earner. So it makes sense to plan ahead. The following tips are helpful in financial preparation:

  • Reserve emergency cash - As suggested by most financial advisors, you should save the equivalent to six months' salary to tide you over if you lose your job.

  • Cut spending - If the noise of layoff is in the air, you need to come up with a plan for cutting expenses. A home budget analysis is necessary in order to eliminate most unnecessary expenses.

  • Defer major Purchases - As layoffs come close, it is not a good time make major purchases - new car, electronics, PC, etc. Even if you have already save money for them, hold it and defer the purchases.

  • Manage debt - Uncontrolled debt can cause financial disaster in jobless situation. If you are already in debt, particularly credit card debt, you may want to consolidate your loans into a single monthly payment with a lower interest rate. If you own a home, consider a low-interest home equity loan.

Job hunting readiness

Make yourself ready all the time so whenever necessary, you can get into the job market as quickly as possible. This way you make precious lead time and have a better chance to maneuver your career ahead smoothly. The following preparations are needed:

  • Keep resume updated - Review your resume every two months and update it with new skills and experience, tune the focus according to new technology trends. Prepare multiple versions with different focuses and areas. Update corresponding cover letters too.

  • Manage career network - Make regular contact to your career network - your previous and current co-workers, friends and families. Organize and update contact information.

  • Follow job market - Know what's going on in the current job market in your career area. See what's hot what's not. Check out employment section in the local newspaper and online job sites.

  • Have references ready - Keep in mind that who you are going to use as you job reference. Make contact and refresh relationship with your reference people.

3. How to Survive from Layoff

Whether you're a young techie or a seasonal IT pro, the chances are, sooner or later you may find yourself, often through no fault of your own, out of work by layoff. Although painful, this is not the end of world. You can survive, and it is possible that it can turn out to be a better world. Here're some tips to help you beat layoff:

  • Negotiate a Severance Package - Most companies offer some severance when you're let go. You should negotiate a better package at the time you are laid off. Talk to the management, review your contributions to the company, and ask more.

  • Apply for unemployment insurance - Take the pink slip and apply for unemployment insurance benefit at the Social Security Administration Office. Do this as soon as possible because it takes time to process before the benefit check arrives. The check is certainly much less than your salary but it helps.

  • Take advantage of government programs - In the event of a layoff, you are most likely eligible for federal or state sponsored unemployment assistance programs. These programs can help you in training, education, and even loans to help you set up your own business. Programs vary from state to state. Check them out and take advantage of them.

  • Look for part time or temp job - While you are searching for permanent employment, also consider part-time or temporary jobs. Part-time and temporary jobs are more flexible and need less commitment from employers, thus are easier to land.

  • Go with out-sourcing - If your job was eliminated as result of out sourcing, then contact the out-sourcing company and present your skills and experience with emphasis on specific industry and business knowledge, you have a chance to be hired to provide out-sourcing service to the same company.

  • Keep in touch with employer - Even after layoff, you still need to keep in touch with the company and communicate with key people there. In a lot of time you can find opportunities to do some project-based contract work. But don't put too effort to try to go back. You major goal should be find new job.

  • Use your network - You can never overlook the power of network. Contact your career network and let everyone know you are look for job. Ask for help, nothing to shame here.

  • Search for job online - The most online job site are monster.com, dice.com, and careerbuilder.com. Make sure you post your resume to these sites at least. Update your resume every week so yours goes to the top of the list. Local newspaper's website may also provide job search in local area.