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08 September 2023

Resilience Through Redundancy

Redundancies can cast a long shadow over an organisation's culture, but this doesn't have to be the case.

Sandra Ordel (Business Psychologist) explores how redundancies could affect your organisation's culture and offers five practical strategies to protect and strengthen it.

This year has seen a sharp rise in redundancies amid challenging economic conditions. Redundancies can cast a long shadow over an organisation. Aside from the very clear human impact, productivity, engagement and job satisfaction can all suffer.

Research shows that 43% of organisations aren’t prepared to manage the impact. So, in this article, we wanted to explore this area. We will uncover the impact of redundancies on company culture and present practical strategies to protect and strengthen it. When handled proactively and with the right approach, an organisation can emerge with its culture intact and even strengthened.


The Impact of Redundancies on Company Culture

Survivor’s guilt and anxiety

Survivor’s guilt and anxiety can manifest amongst the employees who remain. This occurs when people who were spared from redundancy feel guilty for keeping their jobs while others lose theirs. It creates a sense of moral discomfort and can lead to further anxiety as survivors question why they were kept. Over time, this can chip away at their confidence and motivation, casting a cloud over company morale.

Loss of trust

Redundancies can erode trust in an organisation and its leadership. In fact, research by CultureAmp shows a significant decline in both company confidence (-16.9%) and trust in leaders (-10.5%) following redundancies. This loss of trust can happen for many reasons, but generally occurs when employees feel there is a lack of transparency and fairness, sowing doubt about the integrity of the process. As trust breaks down, employees will become less inclined to share their ideas, voice concerns, or actively engage.

Risk aversion

Following redundancies, employees often become more risk averse. The fear of additional layoffs can discourage them from taking risks or proposing innovative ideas. As they prioritise stability over experimentation, collaboration and creativity can become stifled and the company can start to stagnate.


5 Strategies to Protect Company Culture Following Redundancies

1. Open communication and trust building

Transparent communication demonstrates an active commitment to respect, transparency and empathy. It is paramount to rebuilding trust. Leaders should be honest about the reasons behind the redundancies to reduce any uncertainty and to help employees better understand the decision. To demonstrate a clear commitment to keeping employees informed and involved, they should also provide regular updates, and communicate the way forward for the business.

2. Support employee wellbeing

Addressing the strain that redundancies place on wellbeing is critical. It’s essential to show employees that their challenges are valid and that the organisation cares about them. Signpost wellbeing resources and encourage their regular use. These resources could include Employee Assistance Programmes (EAPs), counselling, mental health and resilience workshops, and mental health days.

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3. Recognise and appreciate employees

Redundancies can affect the confidence of employees who remain. That’s why it’s vital to acknowledge their efforts regularly and openly. Show appreciation in ways meaningful to them, whether through words of encouragement or tangible rewards. Celebrate achievements and milestones, no matter how big or small.

4. Promote collaboration and team-building

Redundancies can cause employees to grow distant and feel disengaged. However, it’s essential to help employees remember that they are still part of a team working towards a shared vision. This can be achieved by setting up projects that involve cross-team collaboration or team-building activities that promote connection.

5. Provide leader and manager training

Managers and leaders play a pivotal role during redundancies. Ensure they are trained with the necessary skills to build support and guide their teams. Training can cover areas such as fostering psychological safety, difficult conversations, and managing team wellbeing.

At the same time, it’s essential to provide managers and leaders with support as they navigate these challenges. This support can include resilience training, peer support groups, and 1-1 coaching or mentoring.

Discover how we can support the development of your leaders and managers by clicking below.

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Redundancies are challenging and can have a long-term impact on company culture. That’s why it’s critical to implement proactive strategies that focus on preserving and strengthening the culture. When these strategies are interwoven within a greater wellbeing framework, it enables an organisation and its people to move forward with resilience and confidence for whatever lies ahead.


About the author

SANDRA ORDEL is a Chartered Occupational Psychologist at The Wellbeing Project. She has extensive consulting experience within a wide range of organisations and industry sectors.

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