Protecting Employees From Organizational Trauma

November 19, 2012 Darcy Jacobsen

From time to time in our professional lives, we encounter events at work that shake the foundations of our organization, and leave employees feeling bewildered, distrustful, insecure or even unsafe. Anyone who has been through a merger, layoff, or unexpected natural disaster can attest that the effect on employees is often so profound it can only be described as traumatic. In this post I want to look a little more deeply at some of the causes and effects of that organizational trauma, and consider strategies for building resilience into your workforce that can help employees quickly rebound from organizational change.

We often think of trauma, which is the emotional response to a deeply distressing or disturbing experience, as something that happens unexpectedly, swiftly, and is physically threatening, like a hostage crisis or a car accident. But organizations can experience trauma as well, and typically the trauma of events like M&As or downsizing are slow and pervasive, lasting for months or even years. Although not as cataclysmic as say, a violent workplace incident or a natural disaster like Superstorm Sandy, they can create an environment that chips away at workers’ sense of security, self-worth, health, and well-being. And ultimately their engagement.

According to David Rock, author of Your Brain at Work, “Although a job is often regarded as a purely economic transaction […] the brain experiences the workplace first and foremost as a social system. When people feel betrayed or unrecognized  […] they experience it as a neural impulse, as powerful or painful as a blow to the head. Most people who work in companies rationalize or temper their reactions; they “suck it up,” as the common parlance puts it. But they also limit their commitment and engagement. They become purely transactional employees”.

Types of organizational trauma include: layoffs, mergers and acquisitions, violence in the workplace, death or serious injury, natural disaster, fire, flood, major reorganizations, the turnover of senior leadership or sudden loss of key talent. But whether direct or indirect, sudden or cumulative, organizational trauma typically has the following qualities:

A breakdown in communication
In a traumatized organization, rumors run rampant and often take the place of official communication. Many companies are notoriously bad at communicating in times of crisis—others are constrained by legal concerns. Silence from leadership lets imagination run out of control, and anxiety levels run high.

A breakdown in trust
Traumatic events are highly polarizing, and can easily rupture long-standing good relationships, particularly hierarchical ones between workers and managers. People will align with those who they perceive to be in similar circumstances to themselves, (and therefore non-threatening) and erect emotional barriers against those who they believe are a threat.

A breakdown in productivity
People who are nervous, insecure, frightened or angry are also distracted and not motivated to achieve at very high levels. High stress makes people concentrate on their own emotional state and safety, and they will find it difficult to focus on the task at hand. The APA estimates that job stress, in the form of absenteeism, healthcare costs and productivity loss, costs US companies about $300 billion a year.

Workers feel powerless
In most cases decisions during these moments are made behind closed doors by a small minority, and most workers do not have a voice in that process. Traumatic workplace events can leave workers feeling at best un-empowered or disenfranchised and at worst, outright victimized.

Workers feel hopeless
Powerlessness and uncertainty are a potent mix. While a 2008 study published by the University of Wisconsin–Madison found that downsizing can actually lead to a higher rate of voluntary turnover, the truth is that those employees who don’t immediately jump ship during traumatic times frequently feel trapped in their circumstances with no way out. This can result in low energy levels and situational depression among those who stay behind.

A shake-up in roles and responsibilities
Organizational changes usually mean that workers may be taking on new roles—whether temporarily or permanently. They may take on more work or work of a different kind. This might mean taking on the role of a colleague or friend who is no longer with the company, which can be emotionally tough. They may require re-training or be facing new challenges. They may be part of a new workgroup or working for a new manager.

A loss
Whatever the trauma, the underlying issue for survivors is change—in this case not a positive change, but change that brings a loss. Loss of security, loss of feelings of control or competence, loss of important relationships, loss of culture, loss of a sense of mission or meaning, feelings of survivor guilt—all of these have profound impact on your employees and their psychological states.

Adding to this mix: often companies that go through major change don’t get the results they sought. In fact, according to analyst David Sirota, who has studied the issue of layoffs during recessionary periods, only about a third of companies that downsize gain in increased productivity and profits over a subsequent 3-5 year period. These companies also underperform the stock market over that time. Why the failure? A poll by Leadership IQ might provide a clue. According to that study, 74% of employees who kept their job amidst a corporate layoff say their own productivity has declined since the layoff. And 69% say the quality of their company’s product or service has declined since the layoffs. Likewise, many mergers and acquisitions are doomed to failure.

The cause of this failure generally comes down to the state of mind of employees. It is the employees, after all, who make or break a company’s success. According to psychology professor Kerry Bernes: “although employees (going through organizational change) may not meet diagnostic criteria for Post Traumatic Stress Disorder (PTSD), depression or any other mental disorder, they may nevertheless display some generalized symptoms consistent with those who have experienced and/or perceived a traumatic event to have occurred.” Those symptoms, all of which can seriously impact morale and job performance, might be:

  • Physical: headaches, neck or back pain, chest pain, stomach aches, lack of energy, a change of appetite, difficulties with sleep, restlessness, shaky feelings and panic attacks.
  • Emotional: irritability, anger, rage, a heightened level of suspicion, losing trust in those previously trusted, anxiety, feelings of hopelessness, denial and feelings of futility for the future.
  • Cognitive: blaming others; negative, magnified, catastrophic thinking; poor attention, concentration and memory; and difficulty making decisions or solving problems.
  • Behavioral: withdrawal, avoidance, emotional outbursts, suspiciousness, and an increase in alcohol or drug consumption, pacing and immobilization.


The single best way to both prevent and respond to these events, say experts, is to build up your resilience in the first place. Resilience, says the American Psychological Association, is the “process of adapting well in the face of adversity, trauma, tragedy, threats, or even significant sources of stress — such as family and relationship problems, serious health problems, or workplace and financial stressors. It means ‘bouncing back’ from difficult experiences.”

Here are the ten ways the APA suggests that individuals can build resilience to trauma:

  1. Make connections.
  2. Avoid seeing crises as insurmountable problems.
  3. Accept that change is a part of living.
  4. Move toward your goals.
  5. Take decisive actions.
  6. Look for opportunities for self-discovery.
  7. Nurture a positive view of yourself.
  8. Keep things in perspective.
  9. Maintain a hopeful outlook.
  10. Take care of yourself.


This list is offered for individuals, but it is easily translated to an organizational level, and you can use these principles help your employees prepare to encounter organizational trauma with minimal anxiety. My research on this topic suggests that companies can translate the above list to a company level by practicing five key behaviors:

Build trust and short-circuit the rumor machine by being transparent. Give employees frequent, detailed information about the changes affecting your organization. Keep lines of communication primed, both across groups and up the chain of command, by encouraging daily communications of all kinds. According to Jeanie Daniel Duck, a former senior partner of the Boston Consulting Group and author of The Change Monster: The Human Forces That Fuel or Foil Corporate Transformation and Change, the most powerful thing a manager can do is: “interpret what’s going on for people and explain what it means for them in specific, concrete terms.”

Clarify or re-clarify organizational goals, mission and values. If those things have changed, be sure employees understand how that change affects them and their role. Create peace of mind for workers by communicating strong goals for the organization that can mark a return to stability and ensure future predictability.

Involve employees in decision-making. Revive their self-esteem and optimism by setting clear, achievable objectives and offering the proper tools to achieve results. When employees exert effort, offer them positive feedback that reassures them they are appreciated, and rebuilds their confidence in themselves and the organization.

The most fundamental need people have in times of change or crisis is always the same: support, from one another and from authority figures. Give your employees ways to emotionally connect with each other and with leaders. Encourage them to build a broad social network of bonds throughout the organization. A broader support system will help sustain them even if some of those lines are re-wired or severed.

Do not act blindly. Be sure you are, as David Sirota calls it, “managing by fact”. Obtain the adequate tools to measure your culture and monitor the relationships that sustain it. Make sure you understand where your strengths and weaknesses are, who your influencers are, and how your company communicates. This will help you respond swiftly and accurately in the event of crisis.

The positive role of a social recognition program in managing culture, building resiliency and overcoming organizational trauma cannot be overstated here. In fact, formal recognition can aid you in achieving all five of the behaviors listed above. Strategic, values-based recognition is a way to break down communication blocks and build a trust among workers that will weather change. It helps to disseminate and reinforce core values and organizational goals, making them practicable in a therapeutic, day-to-day way. It is a positive, constructive action that anyone can take to reach across rifts and help to create a positive culture. It also lets workers recognize and celebrate those who are working hard to overcome obstacles. It creates emotional bonds among workers. And it yields valuable information about employees and culture to help leaders measure and monitor organizational health.

And lest you think that recognition might be too subtle or simple to help after damage has been done, I will leave you with the observations of trauma expert Ellen McGrath, who has noted that small iterative actions (such as day-to-day recognition and reward) can often be the best method to recover from trauma. “In a situation that is overwhelming,” she writes, “you don’t go for the big picture. You go for what is closest to you and where you can make a difference.” Recognition is small doses of positive energy and little, frequent touches from co-worker to co-worker. It acknowledges success and celebrates successes in a world that seems pretty bleak. It builds self esteem and empowers workers.

All of this means that social recognition is an excellent way to rebuild from the rubble, or to ensure that your culture is too strong to crumble in the first place.