Last year, I made one of the toughest decisions of my career when I, and my CEO, decided Arrows Group needed to close the company’s offshore centre in India. This has been a very hard process, but I am proud of the way we have carried it out from a moral and good leadership perspective.
For anyone in a similar situation, or driving any major change programme, I have shared some of my most valuable lessons.
Have the Courage of your Convictions
I returned to Arrows Group Global as Managing Director in late summer 2017 following a year’s hiatus. When I came back, I had the opportunity to thoroughly analyse business results. Over a period of several months, it became clear that there was not the anticipated return on investment from our office in India and the right thing for the business was, unfortunately, to close it.
It is easy to feel emotionally attached to an existing strategy. But, if you’ve discovered through in-depth analysis (and not as a knee-jerk reaction) that it’s not right, it’s essential to accept this finding. It was important I maintained the courage of my convictions to carry this through, putting in a change programme for the closure done in the best possible way.
Put Your People First
Once you know a major change is going to come, you have to put your people first. Think from their perspective as you go through the process of change.
Communicate Openly and Honestly
It is really important during change that people understand what is happening and why if you hope to have support for it.
The situation for Arrows Group Global is that we opened our offshore centre in India in 2014. We 100% owned it and grew it from the ground up, with the strategy of having our delivery teams run from there. In reality, it didn’t work as expected for our consulting and technology business.
The fact is, whatever improvements may come along in technology, that people buy people and relationships are built on trust, earned from meeting face to face. Our Indian office had fantastic people working there, doing a great job. But, where we thought it would take half our process time away it probably only saved us 10% as our onshore teams were still needing to meet with candidates and clients. By year three, we realised it wasn’t going to be able to add any return on investment.
My approach during the process of closing the office was to be as transparent as possible with all key stakeholders. Six months to a year before the office shut, I was very honest with the business and the Group about total company performance and what each geography was contributing. I was flying to India at least once a quarter, holding open town hall meetings. The team in India were under no false illusions about how things were going.
When the decision was ultimately taken to close the office, I put together a six-month closing plan. This included flying out to India for 72 hours and holding face-to-face consultations with each of the 70 people working there, so they could understand what was happening and ask any questions.
As well as the individuals directly affected in the Indian office, there are of course the people across the entire business to think about. Our people in the UK and the Netherlands had just adapted to having an offshore centre, it was important they had clarity on why it was closing. I presented an open book on the true costs and return. And, while there was sadness, annoyance and frustration at what was happening, everyone could clearly understand the reasons why and what was going to happen next.
Work in Consultation, not just Top Down
My biggest lesson for leaders running big change programmes is that top-down decisions are never as effective as ones made in consultation with the right people. Find the key stakeholders, who may range from the most junior graduate to senior management, and send messages openly through multiple different channels.
Understand What’s Most Important
Something like an office closure is a time of great uncertainty for those working there. It was essential to understand what people’s biggest concerns were, so we could help as much as possible.
My very trusted CFO in India, who had been through this process before, advised that being made redundant with the resulting loss of face is a big fear in India. So, we openly helped people to look for new opportunities. We found some people roles in our former sister company, ICG Medical. We also retained our complete HR Department to support this process.
Go Beyond the Legal Minimum
In India, the norm when offices are closed is that company directors turn up on Monday with letters in their hand for all employees and immediately empty the building. Legally, you just have to pay a month’s salary. I decided, morally, I did not want to do that. One of our values is people first and that applies across the business.
So, instead, we took the risk of telling the office we were closing it, but it was going to be a 3-month process. We offered everyone gratuity, which is normally reserved for those with 5+ years’ service.
Keep People if you Can
I am very excited that we are bringing eight extremely talented people from our India office to the UK and Netherlands on a global work placement scheme. These are top class individuals, and we will be delighted to keep them on board.
We are also still honouring the charitable foundation we set up, which will be run by ICG Medical.
Expect some Negativity, Listen to and Learn from it
Although I have tried to conduct our office closure in the best way, it has been no surprise during such a difficult process that we have received a small number of negative comments on Glassdoor. Although of course I’d rather there weren’t any, they provide an opportunity to listen and understand what mistakes may have been made. For example, I now know if we opened an offshore centre in the future we would absolutely relocate a few brand ambassadors from the company, as feedback tells us there was a disconnect between the Management team in India and the workforce.
Overall, I am proud on how we communicated the closure, the compensation packages and the braveness of being able to make that decision. This was a strategic decision, so you have to take the emotion out of it – but in reality, you can’t be as black and white as that, particularly when you’re in a people business. I hope I and the company have done the best we can by all our people during a tough process.