Are you rethinking your workforce strategy? The pandemic drastically changed businesses and markets. Many businesses closed in 2020, others retrenched, and some grew. As you address your company’s needs, are you wondering if you have enough workers to operate effectively?
Rightsizing is the process of making a company a more functional size. Often, it is treated as a euphemism for downsizing. It can feel that way from the receiving end, but it is not the same. It can include hiring and, unfortunately, layoffs.
Changing market conditions, fluctuating customer trends, and pivoting internal goals cause businesses to rethink human resources. Rightsizing is about getting your organization to the right size for its strategic objectives. You may decide on one of several goals for your rightsizing initiative:
- Hire new staff to fill in positions if you think certain kinds of expertise are missing.
- Shift and retrain current workers to fit new roles to better use their in-house and functional knowledge.
- Add more management to increase guidance under the new organization.
- Reduce vertical layers to improve communication flow.
- Expand departments to increase output.
Creating a Plan
Of course, the first step in any initiative is creating a plan. In this case, your planning process will focus on identifying the company’s human resource needs and determining whether they are being met. To properly rightsize your company efficiency and profitability, follow these steps:
- Conduct structural diagnostics: Analyze your departments and functions to understand what each role is designed to do and how it contributes to your company goals. Find redundancies, evaluate which experience gaps need to be filled, and obtain a better understanding of how each department and employee helps your company.
- Identify essential roles and personnel: Which roles are essential to your company’s success? Gain greater insight into which specific employees you need to keep based on experience level and unique expertise.
- Determine operational requirements: Understand the total cost of your workforce, the full report of labor, and overhead costs.
Rightsizing sometimes requires hard eliminations of duplicate work to run more efficiently and without redundancies. Sometimes, it requires paring down a workforce and restructuring certain systems. It is critical that you communicate openly and honestly with employees to ease tension and build trust.
This process is not a one-time event, but a continuous activity to help your company more effectively perform to reach its goals. However, a careful look at how your objectives have changed in the aftermath of the pandemic is advisable now. Deciding whether your company is equipped with the skills to succeed can help you determine if rightsizing will help your organization. You may be doing less business than you were in February of 2020, or your employees may be on the verge of quitting due to overwork.
Rightsizing engages teams with the structure and resources to maximize their potential, enabling your company to plan more effectively for the future. You want to properly equip your company to meet its future goals. Rightsizing may be your path leading to the greatest benefits overall, but it does not come without risks. Take a holistic view when looking for redundancies to make sure you are as effective. Be prepared to manage a shift in direction and consider working with consultants to assist with your specific rightsizing needs.