The anatomy of a layoff

How Organizations Stop Thinking and Start Self-Sabotaging

Mass layoffs are everywhere. Every week a new company announces that 10%, 20%, sometimes 30% of its people have become “excess capacity.”

And every time, the narrative is the same:

•  “market shifts”

•  “disruptive technologies”

•  “macroeconomic headwinds”

•  “strategic realignment”

  
  

External forces. Unpredictable weather. Nothing to do with us.

But here’s the truth no one says aloud: If you suddenly need to lay off a quarter of your workforce, the issue is not the market. The issue is: You didn’t steer your own ship.

Organizations don’t get blindsided by reality unless they’ve been refusing to look at it. Because what does it actually mean when a company announces a massive headcount reduction? It means:

• You weren’t listening.

• You weren’t sensing.

• You weren’t adjusting.

• You weren’t honest with yourselves.

Or worse: You knew. And you didn’t want to face it.

HOW DO YOU MISS A SINKING SHIP?

Let’s ask the questions boardrooms avoid:

• If leadership was competent, how did they not notice the ship drifting for months, or years?

• How is it possible that no one ever heard an employee say, “Hey, I think there’s a leak in the hull”?

• How did you miss thousands of rowers paddling in different directions?

• Did anyone ever check whether people understood the mission, or were half of them rowing with no idea why?

• And my personal favorite: If your ship is sinking, why is your first instinct to cut the ship itself?

Mass layoffs don’t happen out of nowhere. They happen because organizations skip the only two actions that keep systems healthy: Reflection and course correction.

Since we clearly haven’t learned this lesson, and thousands of people get emotionally shredded every time a leadership team panics, here is something every organization can do. 

Allow me to present: The Layoff Playbook that prevents avoidable trauma. Yes, trauma. People don’t forget how they were treated when their lives were on the line.

THE LAYOFF PLAYBOOK

STEP 1: Tell the f***ing truth early

The moment you sense real risk, call in your leadership team.

Explain:

• what’s happening

• why it’s happening

• what will happen if nothing changes

• what timelines you’re dealing with

Then tell them to share this openly. As if it’s gospel. Silence multiplies fear. Information shrinks it.

STEP 2: Do the math like adults

Sit down. Look at your finances. Calculate how many months you can survive if nothing improves. Pick a date. This is not cruelty. This is clarity. This is responsibility.

People can’t plan for their lives around vague statements like: “We’re exploring options.”

STEP 3: Give people time and dignity

Call your leaders back in and tell them:

• How long everyone is safe (e.g., “No layoffs for the next four months”). People need time to plan. You are playing with their rent, their medication, their children’s food.

• How the selection process will work. Criteria. Departments. Risks. No surprises.

• That every idea to save the ship is welcome. People can innovate when they’re not terrified.

• The discussions must be open. Create channels where people can ask, think, vent, propose.

• What HR support exists: CV reviews, internal mobility, training. This isn’t coddling, it’s responsible leadership.

• Whether voluntary exits are possible and under what terms.

• What exactly happens if someone is laid off?  Severance, legal rights, next steps.

  
  

Ask your leaders to share everything openly. Transparency isn’t risky, opacity is.

STEP 4: Prepare leaders for the emotional labor

Leaders will have difficult, human conversations. Most of them suck at this. Coach them. Prepare them. Tell them avoidance is not an option. If people are going through existential fear, their leaders must not disappear.

STEP 5: Do what you said you’d do

No pivoting. No last-minute secrecy. No “we can’t comment on that.”

Trust dies exactly once.

You will never resurrect it.

STEP 6: Repair the organization you just broke

A layoff doesn’t end when the last person walks out with a cardboard box.

That’s when the real work begins. The people who stay behind are not “the lucky ones.” They are the ones who will carry the anxiety, the guilt, the anger, the confusion, the silence, and they will do so while trying to keep the company alive.

If you don’t support them, you lose them. Maybe not today. But eventually. Quietly.

They will disengage, detach, and walk out when you least expect it. Post-layoff trauma care is not “soft stuff.” It is operational necessity.

Leaders must:

• Acknowledge the grief. Out loud. Not with platitudes. With truth.

• Rebuild psychological safety. Slowly. With consistency.

• Clarify the new reality. Roles, expectations, workload, boundaries.

• Redistribute work consciously. Not by piling everything on the already overloaded.

• Create space for people to talk, cry, rage, ask. Humans need metabolizing.

• Reaffirm autonomy and agency. Let people make decisions again.

• Show up repeatedly. Trust isn’t rebuilt by a memo.

If you skip this?

You get an organization full of functional ghosts. Present in body, absent in spirit.

WHY THIS MATTERS MORE THAN YOU THINK

Uncertainty is neurologically intolerable.

When people fear for their livelihoods, their brains enter survival mode:

• zero creativity

• zero collaboration

• zero cognitive flexibility

• zero ability to think long-term

You can’t run a company with a workforce whose nervous systems are on fire.

Bad news themselves are never the problem. The silence, the gossip, the mixed messages, the nightmare scenarios in people’s heads, watching your colleagues being terminated effective immediately… That’s the real damage.

No law prevents transparency. No regulation requires cruelty.

YES, THIS IS POSSIBLE — AND IT WORKS

You don’t have to take my word for it.

Companies that handled layoffs with genuine transparency and humility left a documented trail. Here are a few examples:

• Buffer (2016): Transparent letter, full financial breakdown, leadership pay cuts first.

• Airbnb (2020): The most widely praised layoff message in history — clear rationale, timelines, generous support.

And research backs this:

• McKinsey: Organizational health, driven by transparency, predicts performance better than strategy.

  
  

Exec Summary: Treat people like adults and your company doesn’t implode. Radical concept, I know.

IF YOU FAILED TO MAINTAIN THE SYSTEM, AT LEAST DON’T DESTROY THE PEOPLE INSIDE IT

If your organization ended up in a crisis, it’s because you didn’t sense, didn’t reflect, didn’t correct, didn’t maintain. Fine. That’s already done. But then, for the love of everything that still matters: Don’t traumatize your people while cleaning up your own mess.

Some leaders talk about headcount like they’re trimming a hedge. But those “units” have mortgages, families, bills, sick parents, dreams, limits.

You can’t undo the layoff. But you can choose whether the story people tell about this moment is:

“They destroyed us,”

or

“They told us the truth and treated us like humans.”

That choice is always in your hands.