Most Cost-Cutting Layoffs Fail Because Executives Forget a Key Factor: Even When...

Most Cost-Cutting Layoffs Fail Because Executives Forget a Key Factor: Even When Letting People Go, They Need to Motivate Their Employees

Engaging Employees is Not Just for Good Times - Energized
Employees who "Get It" are Central to Successful Cost Cutting

Even in Recessionary Times, Leaders Must Motivate, Not Mandate,
and Win Employees' Hearts and Minds - Cuts Should Work with the
Culture and Can Even Enhance It

Expert Available for Interviews
NEW YORK--(Business Wire)--
Cost-cutting efforts and employee layoffs are already a feature of
the 2008 recession and will probably be a reality for businesses for
some time to come. But most cost-cutting layoffs will fail because
executives forget a key factor: Motivation. Even when laying people
off, leaders need to motivate their employees.

Engaged, energized employees are key to cost-cutting programs and
can make or break layoffs and other cost-cutting efforts, according to
Jon Katzenbach, founder and senior partner at Katzenbach Partners and
Paul Bromfield, principal at Katzenbach Partners, a management
consulting firm focused on helping large companies improve
organizational performance. Katzenbach and Bromfield are the authors
of "Engaging Employees in Recessionary Times," a new commentary piece
that demonstrates that motivating, not mandating, employee behavior
can make the difference between success or failure in cost-reduction
programs.

Said Mr. Katzenbach, "In hard times, it's even more important to
have a motivated workforce. Motivated employees will deliver real cost
savings, and carry out a cost reduction program over the long term. If
cost-cutting initiatives are 'mandated', the result can easily be
'phantom savings' that are never realized. Executives need to work
with, not against, the organization's culture."

Mr. Katzenbach and Mr. Bromfield are available for interviews,
during which they can discuss:

-- How motivation can make employees "proud to be thrifty." Even
in the face of downturns and layoffs, employees can be
persuaded to join in to help save the organization. The trick
is to engage employees emotionally and make thrift a part of
the culture. Companies like Southwest, IKEA and Amazon have
made thrift a central focus of the organization and a point of
pride for staff.

-- Why mandating doesn't work, and motivating does. "Too many
executives think that firmness, discipline and savings are the
key to cost reduction - we may soon see the 2008 version of
'Chainsaw' Al Dunlap," Mr. Bromfield says. But this top-down
approach creates fearful employees who focus on protecting
themselves, not on moving the organization through difficult
times.

-- The central role of frontline "pride builders." In every
organization there are "pride builders" - demanding frontline
managers who are sometimes unconventional, but who get the
most out of their teams. Executives need to identify and
enlist them as leaders in the cost-cutting effort.

-- Questions that leaders need to ask, including:

-0-
*T

-- Will a simple solution like headcount reduction or cutting
bonuses solve our problem? Or does the solution require
the on-site problem solving power of our employees?

-- Will mandated cost reductions be undermined without
employee buy-in? Will "rational compliance" be enough to
motivate employees, or do we also need emotional
commitment?

-- Will cost reductions damage our value proposition to
employees?

-- Are we in danger of forcing short term actions that we will
regret in three years time when things are growing again?

-- Will cost cutting damage innovation and customer empathy?
And, if so, will that cripple our business?
*T

"While it's true that you can't motivate your way out of a
recession, an organization will have a better shot if it can get
employees to make a positive emotional commitment to the challenge,"
Mr. Bromfield says. "If you motivate people, you will get out sooner,
and the benefits will be longer lasting."

For a copy of the commentary, "Engaging Employees in Recessionary
Times," or to schedule an interview with Mr. Katzenbach or Mr.
Bromfield, contact Alexandra Corriveau of Sommerfield Communications
at (212) 255-8386 or alexandra@sommerfield.com.

About Katzenbach Partners

Katzenbach Partners LLC works with leading global companies to
achieve breakthroughs in organizational performance. The firm applies
new thinking about how organizations work, serving companies across
industries to shape strategy, improve operations and effect change.
Katzenbach Partners is building a different kind of consulting firm,
one that integrates strategic problem solving with pragmatic insight
into people and organizations. http://www.katzenbach.com.

Sommerfield Communications, Inc.
Alexandra Corriveau, 212-255-8386
alexandra@sommerfield.com

Copyright Business Wire 2008