10 Things HR Needs to Do in an Economic Downturn: Redux

Posted on Wednesday, September 24, 2008 by Frank Roche

I originally published this article a year ago. Sadly, it’s more important now than ever. At the time, some people thought I was being a bit alarmist — no more. Say, brother, can you spare $800 billion?

For a really compelling look at the big question HR needs to ask itself, check out what Bill Strahan wrote today on HumanMarkets in an article titled “Why Is This Funny?“.

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Have you put gas in your car lately? Been to the grocery store? Tried to get a home loan? Thought about traveling outside the U.S.? Talked to a friend who’s out of a job?

It doesn’t take a PhD in economics to know we’re in an economic downturn. Times are tough.

And when times are tough, it’s time for HR to get going. Here are 10 things HR needs to do in this economic downturn:

Get up, walk out of HR, and talk to the people running operations. That’s where the money is.
Fix your friggin sales comp once and for all. Sales matter more than ever, and having a sales comp “system” that can get changed on a whim won’t work.
Take a deep look at your performance management system. Are you getting the real behaviors that you want, or is it a matter of who goes to the most meetings wins?
Ask not what your company can do for HR, but what HR can do for your company. It’s the big leagues folks, and you need to ask the big questions about how HR contributes to the bottom line.
Fell the deadwood. Yep, it’s time to get out there and chop some wood. If you have people in your organization who needed to go when times were good, that goes double now. Learn to say “buh-bye.” And do it actively.
Comfort the afflicted, and afflict the comfortable. That’s an old journalism phrase, but it’s applicable here. No one should be fat, dumb and happy in this economy. Your job is to wake them up. And if people are nervous, you need to calm them down. (No one said this would be easy.)
Listen to comp consultants who link metrics to company performance. And boot out anyone else who’s trying to sell you the comp plan du jour. When times get tough, fundamentals matter and gimmicks have to get kicked to the curb. Make sure you know the difference.
Let employees know what you know. Everyone gets scared when a company goes on “B” budget. They’re terrified when the “C” budget rolls around. People need reassurances when they’re appropriate, but they also need the truth.
Pay lots of attention to your top talent. Not every company is in a downturn. That means when your bonus plan is flying south for the winter along with your long-term plan, your top talent get roving eyes. Top talent wants to be with winners. Pay attention to them now or else start preparing their departure packets.
Do something. When times get tough, it’s not time to sit around and strategize yourself to death. It’s time to get up and take action. Do the things you always said were right for HR, but you never had the time. Now’s the time.

User Comments

Ron Ulrici

Sep 24th, 2008

Good stuff as usual, Frank.

How about things not to do, like:
Don't do any knee-jerking (like our Government is doing),
Don't close your doors (they always think there is a layoff being planned),
Don't automatically go to the layoff thing (try cutting back every where else first), and…
Don't institute any new faddish program as a “fix.”
Strahan

Sep 24th, 2008

Thanks for republishing this Frank. Great messages and I know that I am using them here. I love the action orientation of the list.

Thanks for the mention of HumanMarkets. Always appreciated.

Bill
Frank

Sep 24th, 2008

Bill, your piece today really knocked me out and gave me inspiration to post this one again. Sometimes good ideas have legs.
Frank

Sep 24th, 2008

Ron, you Bill and I all went to the same Old Skool!
Jim

Sep 25th, 2008

Um, that'd be $800 Buh-buh-buh-billion!
Frank

Sep 25th, 2008

Jim…I guess I just didn't have the heart to write “billion.” I corrected it. Thanks.
practicallyhr@blogspot.com

Sep 27th, 2008

great advice.
Donna Ronayne

Sep 29th, 2008

Great post! Points 3, 5 and 9 are ones that too many companies struggle with each time a downcycle occurs. The reality is that performance needs to be a day-to-day priority so that these items are dealt with in good times or in bad. If you are interested in reading more about the downturn and talent management, check out this article from David Creelman at http://tinyurl.com/3ecagz
Chris Young

Sep 29th, 2008

Frank – Great list here!

I pointed my readers to your post in my weekly Rainmaker 'Fab Five' blog picks for the past week which can be found here: http://www.maximizepossibility.com/employee_ret...

Be well!
Frank

Sep 30th, 2008

That is really nice of you, Chris. I'm flattered. Thanks very much.
Frank

Sep 30th, 2008

Thank you, Donna. And thanks for that reference…that's very good reading. It's time for action..and this down cycle is making that clear to all of us!