Dealing with Regime Change at the Office

"I just got in, after a business trip to Texas, and five people were gone. Gone. The COO and four others. Just like that."

It's always a shock when colleagues are fired. But what makes this particular case so startling is that the person to be taken by surprise was the CEO. Even she didn't know her colleagues were being terminated.

How could that happen? She'd recently sold her technology business. Agreeing to stay on for a two-year earn out meant she was available to advise and she was still visible as a figure head. But she wasn't in charge any more. She knew that — and now her employees knew it too.

Regime change is hard on everyone. Whether it's a new CEO or a new owner, changes of control almost always begin with platitudinous statements about how everything will stay the same. Don't believe it. There really is no such thing as a seamless transition. The CEO who stays on to try to effect that, with the best will in the world, often makes things worse: now there are two bosses. Where do your loyalties lie? Sooner or later, everyone has to look to the future. It can feel disloyal — that's why it's so painful. But you have to think about your future too.

You'll almost always sense regime change before it's official. The grapevine's working overtime; there seem to be a lot of unspecified meetings. This is unavoidable; the CEO wants everyone to stay focused on the day-to-day business, and many negotiations break down. Don't take the secrecy personally and try not to get too absorbed in water-cooler speculation. Your best protection is outstanding performance.

In any change of control, the first question that everyone inevitably asks is: Will there be layoffs? Many new managements will insist that there won't be — even before they know for sure. Saying there will be no layoffs is a little like saying there will be "no new taxes." Everyone means it at the time, but times change.This is the point at which more seasoned employees normally start to look for new jobs. They'd rather jump than be pushed. That isn't necessarily the wrong thing to do — but before you follow suit, make sure you aren't prejudging the future before it's happened. Leave if you are going to something wildly better — don't leave just because you're sulking. There's a great deal of opportunity inside regime change if you can position yourself correctly. And severance payments have probably funded more entrepreneurship and career changes than any Act of Congress.

It takes time for the new regime to know what it wants and for you to figure out what it has to offer you. Everyone is, in a sense, starting from scratch. Your new bosses have to find out who you are, what your strengths are, and how best to work with you. You have to do likewise. This can be galling, especially if you have years of excellent work to your name. Why should you have to prove yourself all over again? Just because you do. But think of it as a new job — and a chance to redefine some of your role and responsibilities to your advantage. Some of the best executives I've seen have seized this moment to win through some of the functional or political changes they'd struggled for years to bring about. When everything is up for grabs, what are the changes that would make your work richer?

It's not always that easy, of course. I recall Kate, a TV executive, who returned from maternity leave to a new boss. She was, she found, tainted by association. When her projects (initiated under her old boss) turned out to be wildly successful, it made matters worse and she found herself ostracized. Anything that made the old strategy look good made her new boss look bad. Caught in the crossfire of regime change, the better she did, the worse she was treated. Ultimately she had no choice but to leave.

Rougher still is cultural change. In the tech company that lost five executives overnight, the real issue was not, of course, performance. The new owners wanted to make it very clear that their arrival ushered in a different mindset. Inheriting a company whose culture was diverse, democratic, and supportive, they wanted people to feel afraid. They thought the workforce had become lazy and complacent and they wanted everyone more productive and efficient. They felt they needed a symbolic act that would signal the new style. Firing five executives certainly achieved that. Now everyone is left wondering where they stand. They're all very committed to the company. They love their jobs and they'd hoped to grow alongside the expansion promised by the new owners. But they're having to confront the hard truth of regime change, which is that it is always wholesale.

New leadership always means new culture. How could it be otherwise? The most important job of business leaders is to create a culture. And so the biggest question that employees face is not "what will happen to my job" but "what will happen to our values?" If you are in a company that gets new management, the most relevant question may not be about your job but about what those new leaders stand for, what they believe in. If you share their values, you can figure out the rest. And if you don't, then you may not want your job anyway.

For more from Margaret Heffernan, visit our Talent & Careers Resource Center.