Qualities of a good leader: Avoid layoffs at all cost?

An article on our sister site, SearchCIO.com, this week highlighted the qualities of a good leader during a recession, culling advice from leadership experts and CIOs. The list includes qualities such as utilizing the ability to inspire those around you, having communication (and listening) skills, proving you can perform and drive results, being able to prioritize, and then — BAM! Avoiding layoffs at all costs. Something that seems almost impossible, as daily news headlines remind us.

In the article, Jason Jennings, an author, speaker and consultant who has studied more than 100,000 companies, said the most productive companies are completely opposed to layoffs. Why? As soon as layoffs begin, employees start to worry about themselves and their futures as opposed to their work.

But with expectations that unemployment will top 9% in 2009 and budgets that are painfully tight, aren’t layoffs necessary?

Oftentimes, they are. When demand for new cars virtually stops, carmakers need to pare back production, and that means job cuts. But when it comes to IT, there are some ways to prove value and cut costs without resorting to the proverbial ax. For example, some companies are relying on their project management offices to steer them through the recession – time-tracking and tying resources to specific projects. Doing so prevents redundant work on projects, speeds project completion (freeing up the time and the budget for more projects) and justifies positions. One IT executive in our recent article specifically attributed job preservation to his PMO.

And most recently, technology giant HP announced pay cuts for the entire workforce as a way of avoiding layoffs after a disappointing first quarter. Rather than scaling back the 100,000-person workforce by 20,000, CEO Mark Hurd preferred the pay cuts to trim the budget.

Jennings notes that besides the morale issues that layoffs cause, job cuts can be a short-term fix. When business picks up again, the recruitment and training for renewed growth will be a setback. No argument there. But if your management is calling for a headcount reduction and you have already made all the efficiency moves you can – what then? Have you found other creative approaches to avoid pink slips?