Layoffs- Change Management

After the layoffs, what next?

Harvard Business Review; Boston; Sep/Oct 1998; Suzy Wetlaufer;

"PERIWINKLE, DEFINITELY periwinkle." Claire Ladd's insistent voice filled the room, but it was greeted with dead silence.

"Did you hear me, Harry? I said periwinkle. It's the color of the fall season. And Harry, no suits this year. We're seeing all separates out of Milan, Paris, and Seventh Avenue. The woman's suit is dead."

Harry Denton shook his head and stared blankly at the woman across his desk. He knew he should be paying attention to her. After all, Claire Ladd represented a major apparel distributor for Delarks, the Chicagobased department-store chain of which he was CEO. But ever since Denton had read that morning's Women's Wear Daily, he had been unable to concentrate on anything but the headline stripped across the top of the second page:

"Delarks Merchandising Chief Defects-Will Others Follow?"

Ladd walked around Denton's desk and gently shook him by the shoulders. In the 20-odd years they had known each other, starting when they were both "rack runners" in New York's bustling garment district, their relationship had always been honest - and even familial. "Snap out of it, Harry!" she laughed. "I'm not hawking periwinkle sweater sets for my health. Are we going to place orders here today or not?" When there was no immediate response, Ladd leaned closer, looking at Denton quizzically. "I mean, Harry," she said, "I was expecting a big order from you-everyone says Delarks is soaring again. You saved the chain. You're a hero on Wall Street. And when I was walking through the Springfield store last week, the place was filled with customers. It was packed-not like the old days, when you could set off a cannon in there and no one would notice. And Harry, the customers: they were buying. We like that."

Denton sighed. He liked it too. In fact, he loved it, as did the company's board of directors. Just that Monday, they had informed him that his contract had been...