I've been on both sides of this within the past year. (Have been let go, and had to let go 40% of a company) Ben Horowitz writes about this, and it's required

I've been on both sides of this within the past year. (Have been let go, and had to let go 40% of a company) Ben Horowitz writes about this, and it's required reading. [0] Some thoughts: 1 - When you have the announcement, be clear about the reasons for it. ("The market moved", "We didn't hit our revenue plan." or "Mgmt f*cked up.") 2 - Highlight the severity of the situation. ("If we don't do this, we have 3 months of runway left, which isn't enough time. If we do this, we have 9 months to get our act in gear.") 3 - Given the constraints of #2, be as generous as possible with severance. 4 - Never ever badmouth anyone who was let go as a result of this. 5 - Be a proactive reference for those let go. Don't just wait for calls - make placement calls for your people. (Note - 3 through 5 is in part to be humane to those leaving, and in part to rally those left behind.) 6 - If at all possible, only cut once. Cut deeper if you need to just to avoid doing it twice. 7 - Be firm in the meetings. "This isn't about performance, it's about saving the company." It's not a negotiation. Have at least 1 witness in the meeting, ideally an HR person. Note - all of these things still won't make it any better, just less worse. It's a tough thing to cut off your foot to save your leg. That's what you're doing. [0] http://www.bhorowitz.com/the_right_way_to_lay_people_off http://www.bhorowitz.com/the_right_way_to_lay_people_off