Laying off staff without losing too much knowledge

Dear Bob …

I’m sure I’m not the only one through this. I’m the IT director for a mid-size company. We have 35 people in our IT group, and it’s about to become 28 people — we’re undergoing layoffs and I have to let 20% of the department go.

Here’s my challenge: Before the recession the philosophy here was “lean and mean,” which means we were stretched pretty thin already, with little staff and less time available for cross training.

Which means that when 7 people leave, a lot of necessary systems knowledge will leave with them.

I have two weeks to figure everything out and make it happen. Any thoughts?

– Staring into the face of disaster, and flinching

Dear Staring …

Well, my first thought is of no value, other than smug satisfaction: I’ve been warning of the dangers of the lean-and-mean philosophy for years (for example, “The future of information technology,” Keep the Joint Running, 5/17/2009).

For all the good it did. Not that this helps you now; not that you took the lean-and-mean path willingly.

Here’s the best idea I have: Outsource infrastructure operations.

At a guess, you have at least seven employees involved in managing networks, servers and so on. Everyone in the industry is hungry right now, which means you can probably negotiate a pretty good deal.

Of course, you won’t save seven employees worth of money, because you have to pay the outsourcer. Still, by using the outsourcer’s commercial data center, ability to negotiate more favorable software license terms, and ability to share staff among multiple clients and you very likely can save half of what you’re spending right now on infrastructure costs.

You’ll still have to layoff a couple of other staff members. I’m guessing at the opportunities right now; adapt the logic to the specifics of your situation:

• Somewhere among your applications staff is the least-critical employee. That’s the one you lay off (of course!).

• Very likely you do a lot of end-user hand-holding. Change your support philosophy to rely more on local power-users and on the ability of adults to figure things out if they have to. The world has changed since the introduction of the PC. Especially among the company’s younger employees are a lot of people who, having grown up with the technology, know enough about keeping them up and running to pick up the slack.

And … once the dust settles from the layoffs, it’s a great opportunity to point out that nothing is free — that the cost of “lean and mean” is increased risk, as everyone just found out.

For the company to remain sustainable, focusing its energies so it does fewer things but does them extremely well might reduce revenues a bit, and might reduce profits a bit too. The increase in resiliency, though, more than offsets these losses.

– Bob