Stop, collaborate and listen: internal communication during a downturn

By Trisha Degg

Recently, I attended a meet-up of HR leaders at start-ups across the Midwest. Most attendees were small but mighty teams of one or two, trying to juggle all things HR – recruiting, retention, engagement, benefits, compensation, you name it.

A common theme discussed amongst the group was scaling back hiring. Still, another theme managed to weave itself across all topics: the importance of an internal communications plan. Simply put, leadership should focus more on communicating with employees during times of transition.

The latter stuck with me because most of our portfolio companies' HR teams resemble this crew, nimble, agile, and doing their best to get ahead of a slowing economy. Via several firsthand accounts, I know most of our portfolio companies are still hiring – but they're being more diligent and thoughtful about the roles they focus on. Many are backfilling "must-have" roles and being more intentional about retaining current employees.

Unfortunately, the greater employee population is not getting this message – which can turn into a bigger problem affecting all tenets of a company, from culture to productivity, even profit.

HR leaders unilaterally believe that if leadership were more transparent regarding company strategy with the broader employee base, said transparent communication would garner trust and understanding and maintain employee engagement. As an aside, employee engagement is crucial to the functioning of the workplace, particularly when morale is low. The evidence is clear; engaged employees are more productive, provide better customer service, experience less burnout, and stay with organizations longer.

For employees to be engaged, they must trust their leaders and the organization. Trust is built via authentic, transparent internal communication. When leadership communication is effective, it leads to better communication throughout the workplace. By demonstrating what good communication looks like - and leading by example - employees are more likely to adopt those positive communication tactics in their workplace communications. It also enables leaders to rally their team around a shared vision if the message is delivered with transparency and genuineness. It's genuinely a waterfall effect.

A worst-case scenario is one where employees watch close colleagues get laid off, then take on extra work "temporarily" only to have no backfill made weeks later with no transparent explanation about the situation – employees will become disaffected and disengage.

To avoid that, leadership should work directly with HR and communications leaders to craft a simple message that tells employees what's happening and how it affects them to uplift morale while keeping the company on the right (HR) path.

Founders and leaders should make sure the overall message includes solid business logic that is specific, consistent, clear, and accurate. Moreover, they should strive to:

  • Make communication a conversation. Internal communication shouldn't be one-way. Instead, it's essential to promote productive and meaningful conversations with employees.
  • If it's a conversation, then leadership has to be prepared to answer questions. Anticipate these questions so you can provide answers immediately; otherwise, jot down what's being asked and follow up with employees promptly.
  • Understand employees are likely uncertain and wary about the future. Show compassion and empathy while providing updates on the business and the vision for the future. Be genuine and personal—authenticity matters.
  • Listen to feedback. Beyond questions, leadership should actively listen to employees, so they feel heard and seen.

Employees look to leadership for information but, more importantly, reassurance during times of uncertainty. It's an opportunity for founders to lead and, when done well, can increase employee trust and engagement, even during times of uncertainty. Moreover, measured, intentional communication also serves to avoid negative publicity in our increasingly connected world.

By Trisha Degg

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