While Australia may have avoided a technical recession of two successive quarters of negative real economic growth, business confidence still remains weak and many organisations and faced with some very tough decisions about the future.

Managing in an organisation after people have been retrenched is extremely challenging-particularly when staff fear that more retrenchments will follow.

Retrenching people must be the last resort, though managers need to be pragmatic: if there is no business then there are no jobs. Following are some suggestions for managing people in tough times.

Decision Making

When faced with a bleak economic outlook that may require retrenchment, redundancies or redeployment, managers need to take stock and revisit your organisation's vision, mission, goals and strategy. Be sure to make decisions that support the achievement of the long-term goals. While quick wins may be attractive it is better to experience diminished short-term returns while working on long-term gains.

Tough times call for openness and honesty. When people know why a decision has been made and that a range of options have been considered, they are more likely to be accepting of the decision.

Importantly, as Macqueen (2001) observes, good leaders and managers will have the courage of their convictions to make the right decisions and stand by them-even if they aren't popular with everyone.

Involve People

Involving people in addressing the difficulties of the future has multiple benefits. Sometimes involving all and sundry will not be appropriate or effective, but the more involvement people have, the greater their ownership and acceptance of the chosen strategy or changes. For example, when faced with making decisions about structure or expense cuts try putting the problem to your team. Employees can bring new ideas and approaches to the decision-making process, and may come up with the best solution.

Consider Motivation

When cutbacks are made, those left behind often experience a decrease in morale and motivation. I've been in organisations where people who have retained their job would have rather left because the new organisational climate is so demotivating.

When addressing motivation issues it is useful to return to Maslow's famous hierarchy of needs. While needs vary from person to person and culture to culture, it should be universally understood that it is not appropriate to provide greater challenges or work on esteem or belonging needs when staff are worried about basic security needs-ie, keeping their jobs. Open and honest communication about the organisation's future is essential.

Support People

During the tough times people react differently and require different levels of support. By support I primarily mean managers showing an interest in their staff-helping them cope with changes and monitoring their reactions. If this doesn't come naturally to you now is a good time to learn. A little consideration for your staff's concerns and feelings can go a long way.

Equally, managers can benefit from having someone to talk to-a mentor, coach or other professional to discuss the emotional and intellectual challenges of tough times. To be effective, managers need to focus on individuals-their staff as well as themselves.

A colleague recently reminded me that leaders and managers are often the subject of conversation around the dinner tables of employees. I'm sure you'd rather be regarded as a supportive manager than one who is complained about.

Re-skill to retain

Organisations can have the best processes and systems but without skilled employees they will not perform. Retrain staff as needed. The cost of employing someone in a new role far outweighs the cost of re-skilling a current employee. This also sends a positive message to the employees and team members about the commitment of the organisation to its people.

Remain Professional

It is difficult for a manager who faces the prospect of losing their own job to remain focused on the future and their team. Such situations will be a test of an individual's character and professionalism. The solution here is to focus on the positives in the current situation, look for opportunities to reach organisational and personal goals and work on your own resilience to cope with change.

Contributed by Mark Johnson

Mark leads Management Perspectives (Unit 102) in Chifley postgraduate programs.