Daily Lesson from Life 31 January 2009

Choices!

If you are given the choice to fire workers from your company due to the recent negative impact of the financial tsunami, how would you decide? Would you fire the foreign workers first or last or what?

This is a very sensitive topic in many countries now facing this choice for REAL as we read about workers in the oil refinery industry in UK protesting against their foreign employer (French Total oil company) hiring Italians and Portuguese contractors for a plant construction project that spread to other refinery sites! We hear the same call in France, in Germany, and even in Singapore!

How would you decide when firing?

Lessons for me are:

1. in any business, it is most important to find sources of revenues and sources of customers. The next thing to closely managed is the cost of doing business and executing long term strategies and short term tactics. Given the dire situation with demand side, we have to focus on the cost reduction action for sure;

2. to be able to decide rationally and sensibly, we must have a good performance appraisal system to distinguish between good and not so good workers. It is not about nationalities but about performance and cost effectiveness when we decide to fire one worker over the other. UNLESS by not doing so will greatly damage the company as a whole due to national pride and emotional tension that destroy the meaning of even operating in the host country!;

3. to have a good performance appraisal system, there must be clear vision and SMART goals setting. The SMART goals must be aligned after the top-down and the bottom-up versions get a chance to discuss, consult and agreed (including agreed to disagree whereby the leaders get to exercise the power to veto). There must then by transparent and open continuous assessment of actual vs. goals set so that every chance of success is given to the people to achieve them!

When people can see that the appraisal is a fair and equitable one, they will be less likely to challenge retrenchment exercise blindly. However, if the leaders themselves could not explain why one is preferred over the other to be let go, it will be very destructively as the sense of injustice and no fair play can flare up and spread to other people who HAD NOT been affected into taking defensive actions.

So, be prepared leaders. Do the right things in the normal time and when you have to take drastic actions, you are ready and able, and at peace with yourself, to explain the unpleasant action of letting people - regardless of nationalities - go!