6 Reasons to have Outplacement as part of your Strategy

Outplacement should be part of any organizations HR strategy. If used well it can be integral to Talent Management.

What is outplacement?

Outplacement is the support service provided by an organization to help employees transition to new jobs or roles outside the organization.

Outplacement as a strategy to remain competitive

With every adverse or unanticipated change in economic and business environment, like the one we are witnessing right now due to Covid-19 or change in business strategy or competitive dynamic etc., businesses need to respond either through right sizing or restructuring to handle new economic and business realities.

It is a well-accepted fact that talent is the force behind performance and innovation for an organization and no one wants to make people redundant. However, many times companies are forced to do so leading to many more complexities rather than helping organization achieve its objectives. If not handled well such exercise can lead to:

  1. Decreased workforce moral – Creates insecurity among the workforce
  2. Bad blood with exiting employees- Employees feel let down and become bitter
  3. Negative publicity- Disgruntled employees talk negative about company at every available opportunity and channel (social media etc.)
  4. Unpleasant experience for managers- Not equipped to handle such scenarios and can distract them from their job

Whereas having a well-defined outplacement strategy can help companies avoid all this. Infact when done right it leads to:

  1. Enhanced productivity
  2. High workforce morale
  3. Accelerate profitability
  4. Rebuild brand reputation

Reasons to have an outplacement program

Outplacement should not only be looked from the perspective of employees who are on their way out but one should also keep in mind how the employees (survivors) who will remain with organization deals with such unwanted situation around them.  Any such downsizing/ restructuring creates an uncertainty for everyone, more so for the survivors who are under constant fear that they may be next in line of any such further action. Nothing can be more reassuring for employees knowing that their employer will support them if any such eventuality arises. It creates security for survivors and preserves the culture of an organization. It gives employees sense of belief that they will not be left on their own to deal with any such situation in future.

Thus, it makes strategic sense for an organizations to have a well thought outplacement program. Some of the reasons to have one are:

  1. It is right thing to do in difficult time for employees. It reduces stress of impacted employees as well as it also reassures survivors that support will be provided. Moreover, it is morally right to provide such support and ease the anxiety of employees.
  2. Boosts organization’s public image. Employees and public at large see organization in positive light. Any layoffs are bound to create negative headlines however such well-meaning intervention can work as big positive, making company attractive for prospective employee in future.
  3. Reduce legal challenges or litigation risk by providing suitable financial compensation along with desired support to find new opportunity. Employees see company as their partner who is helping them to take next step in their professional journey instead of resenting the move by company. It saves resources and time of an organization.
  4. Continued employee engagement during the transition leads to less or no loss of productivity. Dedicating time and resources for meaningful engagement, during challenging times, with both impacted and surviving employees adds to the positive change in productivity.
  5. Protection of management team as external agency will be guiding the impacted employees. Internal team is ill equipped to handle such situation whereas external experts being experienced are at ease in dealing with such circumstances.
  6. Increases retention and performance of employees. Employees prefer to work with organization where they have more security. Companies can build trust and make employees feel more secure through such programs. This feeling of security also leads to better performance.

Elements of a good outplacement program

Next logical question is what constitute a good outplacement program? Is it just about connecting employee with an external recruiting agency or paying severance package?

Definitely it is not and is much more than it. A good outplacement program should consist of-

  1. Provide emotional and practical support to employees who are going to get impacted in the process of lay off/ downsizing etc.
  2. Counselling to help employees cope up with the stress/ trauma. Proper counselling can equip impacted employees with positive attitude.
  3. Career coaching to understand employee aspiration and help them evaluate their next possible options so that career goals can be achieved.
  4. Formulate a job seeking strategy by analyzing individual’s potential, skill set, and experience.
  5. Resume/ professional profile writing to make employee represent their skills in appropriate manner that can make them attractive to prospective hirers.
  6. Interview training to brush interviewing skills of employees to build confidence.
  7. Consistency in response without any bias.


Outplacement if integrated carefully in an organization’s scheme of things can act as catalysts to not only make organization agile thereby making it future ready to respond to challenges faced but also to help attract talent. It will be an important employee benefit with positive impact on employee commitment to the organization. Such program builds positive employer and brand image. All these factors combined together can give an organization competitive advantage in market place to make most of opportunities that are available for an organization.


Rakesh Sharma

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