Restructuring

Globali­sation, digitali­sation and decarboni­sation are causing huge and rapidly accelerating trans­formation of the economy and society. Companies have been under pressure to reform and restructure for years now, but Covid 19 has further intensified that pressure. Re­defining the “co-determination” partner­ship between manage­ment, staff and their represen­tatives that is such an important part of the German work­place may be a key catalyst for urgently needed progress in this area.

Collaboration with co-determination delegates in a relation­ship built on mutual trust is ideal but, prior to the Covid crisis, constructive consultation between employer and employee represen­tatives was not always the case. It was only achieved within organi­sations where an atmosphere of mutual cooperation had been developed and strengthened over several years. In the Covid 19 situation there is now an increased chance of real co-determination even within companies that have no prior experience of it, as the pressure from outside and within the company to lead it through the crisis and put it on a stable, future-proof footing “after the event” is huge and some­thing that is shared by both sides of the workplace.

Overturning “classic” assignment of roles

The “classic” model of role assign­ment when restructuring is imminent as follows: The executive management, works council and union present their specific positions and traditional stances during the discussions and negotiations. Both parties flex their muscles to achieve their own goals and – in a Machia­vellian sense – do not hesitate to choose what­ever methods best serve their own needs, both within and beyond the negotiating rounds. If agree­ment can be reached during discussions, both sides then present the result as a success of “their” making, often in parallel and strictly segregated communi­cations strands. The old “battle lines” in terms of substance and argumentation are clearly drawn in this process, while acceptance of the need to break with the past and commit to a new beginning often falls by the wayside.

New process and consultation model – “negotiating eye-to-eye”

At a time when forward-thinking, and in some cases radical decisions, need to be made at increasingly shorter intervals and the pressure to survive is mounting, companies are well advised to strive for a constructive, consultative relation­ship between executive manage­ment and employees, based on mutual trust.

Instead of “battling” each other in negotiations and wasting their breath, instead of heaping pressure on each other via internal and external media and antagonising each other, executive management team and employees in crisis mode need to reach an understanding about what they have in common. Everyone fundamentally wants the same thing – to ensure the survival of the company. Everyone is “in the same boat” and all parties need to see that any ship navigating rough seas can only manoeuvre its way out of the storm into calmer waters and head confidently into the future on a safer, stronger course if everyone pulls together.

It all starts with the negotiating strategy. Instead of “pushing through” an urgently needed, forward-looking transformation of the company, or on the other side, blocking or at least delaying any tough cutbacks at the expense of employees, a constructive, common search from the outset for answers and practical implemen­tation very often leads to a sustainable, forward-thinking solution. It is crucial to take into account the perspective of the other side from the very start. What do we need in order to be able to accept the restructuring, help carry it through and count it as a success? What do we need to do to ensure the company has a long-term future? Taking this approach allows negotiation to occur between equals, “at eye level”, with the aim from the very beginning of coming up with an expedient solution for both sides.

Including both communicative perspectives from the start

As well as the economic and social aspects, the different communications perspectives also have to be taken into account at the negotiating stage. Ideally each side will anticipate the content and messages that will be important to the other side in their communi­cations with the relevant stakeholders. For instance, if it is important for the employee side to make it clear in any communi­cations that a radical culling of jobs will not only affect employees but also have a significant impact on executive manage­ment, the employer side will be able to pick up this perspective in a proactive manner. The benefits of early agreement then become useful in the way the outcome is later communicated. By making cuts at the manage­ment level and accentuating this in their communi­cations, the company is signalling: “We understand where you are coming from – and advocate fair distribution of the pain.” The employee representatives can make it clear to fellow staff that “We managed to drive home a central point of our agenda in the negotiations.” In this way, both sides strengthen their reputation and credibility.

Coordinate communications content and process

After meeting “at eye level” during negotiations to seek common solutions, both sides have the necessary will to reap the rewards in their communications. In order to maximise this potential, it is advisable for both the company and the workforce to collaborate in good faith on the communicative process and the content of any messages and measures and reach mutual agreement on this – without either side giving up its own right to communicate in its own words. Both sides continue to adopt the roles expected of them and serve their specific communi­cations channels in a nuanced manner (Executive Board letter, intranet news, works council news­letter etc.). But neither party seeks to claim the communi­cative high ground or gain a jump on the other as first mover. This eliminates the need for any leakage strategies.

In practice this means that the executive management, works council and union all work together to decide the choreography and communi­cations time­table for the launch day. This determines who will address the stake­holders with what messages when, using which media and via which channels. This includes the content to be conveyed in each case. As well as alignment over the choreography and content, joint publications or combined physical or virtual appearances by manage­ment, works council and union can act as particularly effective signs to employees or at press conferences. Joint video clips of interviews or dialogue sessions may also be beneficial. If employees, due to Covid or reduced-working hours, are not currently on the premises and have no access to in-house digital services (corporate intranet, social intranet etc.) information can be made accessible to them via public channels like YouTube. This has the added bonus of extending their reach – both within their own company and beyond, as journalists use such media as sources of their own clips and quotes.

Benefits for company and workforce

Coordinated communications, both during and particularly following the negotiating phase, symbolically underscore the consensual approach to finding a solution, and have tangible benefits in terms of how things are perceived by the relevant stake­holders on each side – i.e. a win-win situation for both the company and the work­force.

The company can boost its “We” feeling across all line staff and leadership levels and motivate everyone to seek consensus, engage­ment and buy-in to the implementation of the agreed measures. Both internally and externally in the eyes of the media – local public opinion as well as local and regional govern­ment – the reputation of the company is enhanced as an employer acting responsibly in difficult times. The trust of shareholders, customers and suppliers in the ability of management to act and secure the future of the company is also increased, which further cements existing business relation­ships on a sustainable basis.

Equally, employee representatives can use the opportunity to underline their central, influential role and make it more visible – as represen­tatives of the interests of all employees, co-creators of the future of the company and facilitators of sound, secure employ­ment.

Photo: iStock.com/mbbirdy

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