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Rethinking Outplacement - How Can We Make It More Relevant?

My initial headline for this post was going to be "Outplacement Does Not Have to S**K".

I gave a presentation with title last week at our first ever DisruptHR Atlanta event and was ready to transcribe and send it via LinkedIn Publisher but after some reflection have decided to take a different approach.

Outplacement whether we like it or not is a necessary part of the business process. Organizations need to be able to achieve their business (cost reductions, customer loss, acquisitions) and performance (reorganization, culture fit) objectives by unfortunately letting people go. The impact can be significant on individuals and communities.

Consider  this:

  • Conservative estimates are that 750,000 people were in outplacement in 2015. To put that into perspective: that is the total population of Birmingham, AL.
  • The World Economic Forum says that 5 million jobs will be displaced by technology by 2020 (equal to size of metro Atlanta where I live).

The human stakes for these actions are high. Displaced employees need to find work and many are not equipped with the skills and tools to conduct a proper job search. This is where outplacement fits in but there is more to the story.

The original concept of outplacement was to provide transitioned employees with professional career assistance so that their disruptive period of unemployment would be as short as possible with the help of professional guidance.

A new profession of consulting firms (of which The Frontier Group belongs) emerged to provide the professional career transition services to the community of displaced employees. The services covered the full spectrum of essentials needed (resume, interviewing, marketing, research, landing) to have a successful and hopefully short job search.

This process went largely unchanged for many years until cost pressures began to push outplacement fees downward after 2009. At first firms were able to absorb the costs by improving their technology programs, offering group programs and moving candidates to virtual delivery. The downward pricing pressure continued though and it eventually forced delivery programs to candidates be reduced.

The net result today is the we have a large number of candidates in outplacement with frugal programs. This does not help anyone:

  • Employees are left discouraged and rejected. Consider that there is a sizable segment of the displaced employee community that is over 50 years old and has not conducted a job search in many years. 
  • Employers open themselves up to their corporate brand being tarnished, unemployment and litigation costs going up and their standing in the community decreasing. Read Glassdoor.com reviews sometime and you can see how negative comments can hurt a company's reputation and talent acquisition efforts.

I believe that no one wants this to happen and yet we seem to be caught in a spiral that is not helping any party.

What can be done?

First, for outplacement to really matter the focus needs to be on re-employment and redeployment.

The primary objectives needs to be on getting every transitioned employee into a new role as quickly as possible. This may sound simplistic but in practice this is not being done.

The process as practiced across the broad spectrum of outplacement providers can many times focus on process (access to an online portal, resume interview, limited coaching hours, access to webinars) rather than results. Process is not bad but we have to avoid it becoming the ends rather than means.

Here are some ideas that I believe can help make outplacement more relevant and helpful.

  • Explore redeployment options before downsizings. With careful planning and execution outplacement firms can work with employee targeted for job elimination on finding new roles either outside or inside the organization. With enough lead time they can successfully transition to their new role without having any period of unemployment. 
  • Create partnerships with provider networks – not a commodity based transactional relationships. While this may somewhat self serving on my part, organizations need to look at how much funding is going towards career transition services. The outplacement firm can be a strategic partner in helping maintain brand equity, keep unemployment costs down and minimize litigation. Career transition firms now have the analytics to show how this can be done. Outplacement firms need to maintain their close relationships with Human Resources. Shifting the relationship to Procurement can break this bond.
  • Consider outplacement as a marketing and business development investment. By building bridges versus walls with ex-employees smart organizations can leverage the relationships for future sources for referrals and business development. This is happening daily in Silicon Valley where you can see how valuable relationships matter.
  • Maintain an employee incentive structure for quicker re-employment. There are still severance agreements that are structured so that an employee will be asked to reimburse a portion of their severance if they find employment before their agreement termination date. Removing this disincentive will  align behaviors correctly towards finding work as quickly as possible.

Outplacement can greatly help transitioned employees find new positions and rebuild their careers if resourced and supported. Business changes and disruptions are going to leave many people in transition in the years ahead.

Taking a positive approach towards creatively finding ways to help these people quickly find re-employment will create stronger corporate brands that will help their talent acquisition, marketing and community standing.