- Ethan Evans is a retired Amazon VP who invented products like Prime Video and Prime Gaming.
- Evans says he once conducted layoffs at a startup, and then was laid off himself.
- He gives a 4-part framework on how to successfully (and humanely) oversee layoffs.
I once laid off one-third of the startup I had just helped to build. I was the Vice President of Operations and owned a range of functions, including human resources and recruiting.
As a shrinking startup no longer needs to recruit, I administered the layoff as my last act and was laid off, in turn, the next day.
For the entire year beforehand, I had been focused on hiring like crazy. The internet wisdom of the day was “get big fast,” so Goldman Sachs had given us tens of millions of dollars and told us to grow as fast as possible.
In one year, we went from 50 employees to 150. Four months and two waves of layoffs later, we were back at 50. We were following “expert” advice and ended up following it off a cliff.
These days, we are seeing tons of layoffs, and good leaders need to be skilled at all parts of the layoff process for the sake of their team members and themselves.
There are several parts to handling this process well:
1. Planning
Depending on your level in the company, you may be part of planning the layoff and choosing who will stay and who will go. If you get the sense that a layoff is coming, you want to try to be a part of that process so you can influence the outcome.
Being part of these decisions is gut-wrenching because you’re making choices that impact your employees and their families. However, it’s even worse to find yourself as “just the messenger.” That conveys bad news and helplessness all at the same time.
2. Communication
Each individual reacts to a layoff in very different ways. I once had an employee who went back to his desk and shattered a glass award the company had given him, feeling it was meaningless now that he had been laid off.
Other employees have become so upset that they could not complete the meetings. We had to let them go home, process the event, and come back the next day to finish the conversation.
The key as a leader in any of these circumstances is to be calm yourself so that you can adapt to the needs of the employee and the situation. Don’t feel that you must force the employee through a script if it is the wrong thing for the human being across the table.
While you may have information that you must convey for legal reasons, if the employee cannot handle it, take a break. Let them have a minute, or consider coming back the next day to get the details. Scripts are great to help you be organized, avoid omissions, and control your own emotions, but you should flex your delivery based on the situation. Behave as you would want your leader to behave.
3. Helping impacted employees
As draining as the actual layoff can be, the real work of a leader begins after the list is made. This is where you begin supporting them in finding their next role.
It is often possible to place team members into other open roles in your company, either directly or by strongly recommending them to leaders who are still hiring. Other times, you can be helpful by making referrals and introductions to leaders in other organizations.
In my case, I organized a meetup of laid-off employees and gave them all a copy of “What Color Is Your Parachute,” a job-hunting manual. We sat together, discussed job search tips, and created a process to share leads with one another. This collaborative process gave the affected employees a support network and additional resources to make their next move.
4. Retaining your team
If you remain at the company yourself, your other challenge as a leader is retaining and motivating your team.
After a wave of layoffs, the team will have many feelings and concerns. These will include grief and anger about departing colleagues, feelings that the company has failed them, worries about their own jobs, and concern about how to handle the newly unowned work.
These concerns all have emotional roots. Too often, particularly at tech companies, we focus on logical explanations when the employees (human beings!) actually need help with their worries.
Give them time, space, and support in adjusting to the new circumstances. Then, lay out a clear path forward. Most employees can and will re-engage after a layoff if you can help them see how they and the company can succeed.
We need skilled, compassionate, and prepared leaders
No one gets training in how to handle a layoff because it is a taboo subject that companies avoid. But, in order to protect yourself and your team, you have to educate yourself in advance.
Most long-term leaders will go through several cycles of layoffs in their careers, and the best leaders recognize that layoffs are relatively common. Knowing this, they prepare themselves to lead well through layoffs instead of being caught off guard.
I have made the call to lay off employees, and I have been laid off myself. Reflecting on both sides of the experience I can say without a doubt that a skilled, compassionate, and prepared leader makes all the difference.
Ethan Evans is a retired Amazon vice president with over 23 years of experience as a business executive.
