The HRM Function has to demonstrate the human face of the organization in the recession. The cost cut is necessary, but it does not mean, that the communication towards employees is treating them as monkeys.
The economic slowdown brings a need to cut the operational costs of the organization. Each company gets fat in the time of the economic growth as the growing revenues can pay almost any good idea. When the company wants to hire new employees, no proper cost benefit analysis is needed.
The Human Resources should be always very conservative in hiring new employees and making the payroll of the organization huge. When the recession comes, the need to cut the payroll is very painful and the top management tries to hide the real truth.
The HRM Function has to be the employee advocate in the recession and the HRM Function has to navigate the top management to make very direct and very sensitive decisions about the number of employees in the organization.
When the organization has to cut the headcount, the HRM Function should provide the advice to the top management about the number, timing and areas to focus at. The HRM Function should always limit the headcount reduction to the needed minimum and it should overview the whole headcount reduction process.
The human face of Human Resources is in the smart management of the whole headcount reduction activity and with the supporting activities of the reduction process.
