Times of organisational change can be difficult for the entire organisation, impacting not only employees transitioning out of the company, but also those remaining. It’s therefore unsurprising that supporting employees through this transition is often the number one priority of an HR manager, even if it means failing to consider the ROI of outplacement.

In fact, in our recent outplacement survey, nearly 80% of HR managers indicated that concern for the welfare of transitioning employees was the key driver for providing outplacement services during a redundancy period. Another important factor was minimising the impact on remaining employees.

However, there is little evidence to suggest that HR managers are actually looking at the ROI of outplacement providers and holding them accountable for delivering these outcomes. In fact, only 41% of respondents reported a measurable improvement in performance after a redundancy event.

As a result, it’s clear that organisations are not getting the return on investment that should be expected of an outplacement program. But what exactly should this return be?

To answer this, we need to first consider the potential impact of a redundancy event where outplacement services haven’t been provided. Without a way to support retrenched employees, organisations run the risk of triggering employee discord. This can lead to unwanted public attention, brand damage, and legal ramifications. It can also adversely impact the experiences of remaining employees, as well as harming the organisation’s chances of attracting new talent.

Therefore, an outplacement program must be designed with the following objectives in mind:

  • To help employees transition successfully to the next phase of their career – By providing the right support, counselling and coaching, outplacement programs should measurably improve the employee’s chances of securing new employment quickly
  • To improve employee retention and productivity – This is achieved by keeping lines of communication with remaining employees open, and by demonstrating the support being given to employees leaving the organisation
  • To protect the organisation’s brand and mitigate reputational risk – The right outplacement support should help to promote goodwill towards the organisation, and assist in keeping its positive public image intact
  • To reduce legal risk – By helping employees improve their chances of a successful transition to their next employment, outplacement can help to minimise and even avoid litigation

These objectives should serve as key performance indicators to assess the ROI of outplacement. By working with an outplacement provider to build a program that delivers to these objectives, HR managers will be able to better serve their employees, and demonstrate the program’s return on investment to management.