The first layoff I ever executed, I was about two years into my career.
I was at a general contractor, a genuinely great company, at a great time, that talked about being a family of companies before it built anything else. Then the world shifted, and leadership decided we had to do layoffs.
I remember the day I had to put the plan into action. I broke out in hives, all over my legs. My body was talking to me. I didn't know how to listen yet.
I went into the conversations anyway. One man looked at me and asked, "If we are family, how are we doing layoffs?"
It crushed me. I didn't have an answer for him. Looking back, I don't think anyone above me had really wrestled with that question either. We had the language of family. We hadn't done the harder work of understanding why the business needed this call, or what we were actually trying to protect.
That gap is what this post is about.
When the economy gets tight, too many companies run straight to the people bucket.
Pause hiring.
Freeze salaries.
Cut roles.
Reduce benefits.
Sometimes those decisions are necessary. But they should not be the first reflex simply because Human Resources owns visible expense.
The better question is not, "Where can we cut people costs?"
The better question is, "How does this business survive and keep its promises?"
That question changes the conversation.
Do we have enough cash for the next chapter?
Are we pursuing growth, stability, or contraction?
Which expenses are essential to the strategy?
Which expenses are habits?
Which roles create the most leverage?
Which programs protect our ability to retain the people we cannot afford to lose?
This is not an HR decision. It is a business decision, and it requires the entire management team at the table, not just the function that happens to own the paperwork. Every executive leader needs this lens, not only the head of HR.
That means walking in with business judgment, not emotional panic or people-first slogans.
Your vision, mission, and values are not a slogan you reach for on the good days. They are the centerpiece of the decision, the shared language the whole room builds from, and the standard against which every message gets held. Too many companies only invoke their values when things are easy. Values matter most when things are hard. That is the moment people are actually watching to see if you meant them.
Before anything ships, here is what has to be in place.
Anchor the plan in vision, mission, and values. Every decision and every message should be something you could point back to and say, this is who we said we are.
Build a decision matrix. Name every decision that has to get made and who owns it. No ambiguity about who is accountable for what.
Run the numbers with a trusted finance partner. Know exactly what this buys the business before anyone else knows a decision has been made.
Build the full comms cascade. Who hears first. When they hear it. What message they get. Who delivers it. The direct manager delivers the news to their own person, not HR, not a stranger. HR equips managers with the language and handles logistics. The executive sponsor delivers the company-wide message. Legal and comms sign off before any of it goes out.
Get all of it approved, scheduled, and ready before launch. Nothing ships live. Nothing gets figured out in the room.
Because if compensation is treated as an isolated line item, the company will make isolated decisions. And isolated decisions create cultural consequences.
The people budget is not separate from the business strategy. It is one of the clearest tests of whether the business strategy is real.
Before you recommend a freeze, a cut, or a pause, ask the harder question:
What are we trying to preserve?
Because someone in that room might ask you the same question that man asked me. Make sure you have an answer this time, and make sure it's one your vision and values would actually back up.Sign up here: anitagrantham.beehiiv.com
Anita Grantham
[email protected]
602.722.6270