As One Door Closes…
Many people use redundancy as the chance to investigate entrepreneurship. Sometimes it’s the right answer. Sometimes it’s not. Mike examines the right way to handle being let go – and the opportunities it presents.
One of the most difficult jobs we do, but one of the most important, is helping people who have been fired look at options for the future. We get asked to do this by firms that are laying people off and want to soften the blow – a move that is both humane and sensible, as it is better to have ex-employees who are friends rather than enemies (a point macho managers seem to forget, then wonder why their organization slowly acquires clusters of enemies out there).
We always recommend newly dismissed people to take a bit of time out to consider various options. Once they’ve got over the witchcraft course and thrown away the doll with the face of the HR director on, they can get on with life.
Not everyone we advise is entrepreneur material. We try and be honest here, not telling people outright that they’ll never make it, but showing them how much of a mountain they have to climb to get there. But many have what it takes. Ex-employees bring a number of hugely valuable things into their new businesses, things that dynamic young entrepreneurs cannot. Experience, for example. Knowledge of the marketplace. Forget those whizz-kids who say that knowledge and experience are drawbacks. That may have been true during the dotcom boom, when they prevented people from doing things like wasting millions of pounds of other people’s money, but in the new century these things are hugely useful, as long as they are harnessed to an entrepreneurial attitude. Knowledge and experience should be the material from which older entrepreneurs forge a new vision of how the market is to be served. How are you going to be better than your ex-employer? People who answer ‘Er… Um…’ to this question haven’t been through the entrepreneurial visioning process, and need to.
Of course, the real value that old hands bring to new enterprises is contacts. Those elusive first customers, who will help them define their product and market, are in their rolodex. There may be some rule forbidding you dealing with them, but there’s no rule against ringing them up, buying them lunch and talking your ideas through with them, so that when the no-dealing rule expires, you are ready to roll.
Of course we’d never suggest to employees that they build good relationships with key clients before the dismissal process cranks into action. Your loyalty to the company should be, well, the same as it is about to show to you.
One route taken by some dismissed people is straight back into the company, as consultants. Downsizing often results in what business schools call the ‘tacit knowledge drain’: in plain English, they fire a load of people, then suddenly realize that nobody left in the firm has a clue how certain processes work. They then hire the ex-employees back. Nice. The danger here is of being a one-customer business – the curse of many consultancies. Yes, it’s great to be back on a higher day-rate, but you need to be looking around for a range of customers.
This brings us back to our old friend, the Balanced Business Team. Consultants are normally good deliverers. Who is doing your sales? Remember that if you are a one-person band, you have to be your own sales cornerstone, and this can be hell for some people. Better to try and build a team. If a group of people are being ‘let go’ at the same time, they should get together and see if they have skills that would dovetail into a balanced team. One sales animal can be a virtual sales cornerstone for several consultants – the Beermat model is flexible. Finance cornerstones can be virtual too.
Remember that you do not have to be an entrepreneur to play a key role in an entrepreneurial business. Entrepreneurs need cornerstones, and laid-off managers are often ideal for this kind of work
In our experience, most people who move from redundancy to entrepreneurship create lifestyle businesses. The skills of time management and virtual team-building are paramount here. Others do go on to create large, growing businesses – the next generation of ‘mighty oaks’ – but they are in a minority.
The final message we give people who have been laid off is to treat the experience as an opportunity rather than a disaster. Recent research shows that ‘lucky’ people aren’t really any luckier than unlucky ones: they just treat the ups and downs of life differently. Getting a roomful of people who have just been fired to create a deafening group cheer is not easy, but it can be done. And there are many businesses out there to prove that the cheer was the right response.