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The Ultimate Outplacement Consultants Cheat Sheet

December 29, 2023 by Cynthia Orduña

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Downsizing can be a turbulent period for companies. Although it’s an inevitable part of business, downsizing can trigger bitter emotions in redundant workers which can lead to lawsuits, loss of brand trust, and various other reputational hazards.

To avoid these unwanted consequences, HR departments work side-by-side with outplacement firms and consultants to ensure no one is negatively affected by the decision to downsize.

Therefore, choosing an outplacement consultant that has your best interests at heart is crucial. 

Yet, with so many outplacement firms out there, finding the right outplacement consultant is easier said than done. This is why we’ve put together a cheat sheet that will help you in your search for outplacement consultants.

In this article you’ll learn:

  • What outplacement consultants do. 
  • What the outplacement process entails.
  • Tips on how to find the right outplacement consultant. 
  • The true cost of not offering outplacement. 

Let’s get started with the basics.

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What Do Outplacement Consultants Do?

Outplacement consultants, alternatively referred to as outplacement firms or agencies, specialize in delivering services to organizations to aid their impacted staff members in transitioning out of their current employment. Their main objective is to assist these individuals in discovering new job opportunities and navigating the challenges associated with career transitions. 

When a layoff event is not managed effectively, various issues may arise, such as decreased productivity among remaining employees due to concerns about potential layoffs, or disgruntled former employees negatively impacting the company on social media. In essence, a poorly executed reduction in force (RIF) can escalate into a public relations disaster. 

Collaborating with the right outplacement provider can significantly improve this outcome. Whether the layoff involves a few employees or several hundred, the quality of support they receive throughout the process is crucial. The future success of the affected individuals and the company’s reputation hinge on the effectiveness of this support.

Outplacement Consultants vs Outplacement Coaches 

Frequently mistaken for outplacement coaches, outplacement consultants specialize in overseeing extensive layoffs or organizational restructurings for their clients. They collaborate directly with executives and the human resources department, providing recommendations on outplacement services such as career counseling, resume writing, and job search support for the employees undergoing transitions. 

In contrast, outplacement coaches step in during the subsequent phase, engaging in more personalized, one-on-one career coaching sessions with former employees to assist them in successfully transitioning to new positions.

What Does the Outplacement Process Entail?

The outplacement process comprises of several essential stages designed to support employees facing layoffs as they navigate their career transition. Initially, the outplacement consultant onboards the individual, after which an outplacement coach conducts a thorough ‘needs assessment’ to comprehend the individual’s skills, strengths, and career objectives. 

Using the insights gained from this assessment, the outplacement career coach takes proactive measures with participants, such as tailoring their resumes, establishing social media profiles, and initiating networking activities. Participants gain access to online tools for self-directed learning, aiding in skill enhancement and knowledge development. 

Guided by their outplacement coach and these resources, participants can then actively pursue specific job opportunities on various platforms. This part of the process includes vital interview preparation to ensure participants can effectively present themselves to potential employers. 

Ultimately, the overarching goal of the outplacement process is to facilitate a successful transition. With these comprehensive steps, participants frequently secure new roles aligned with their career aspirations and qualifications. 

Finding the Right Outplacement Consultant

For an organization confronting the possibility of a layoff, selecting an outplacement consultant becomes a critical task that involves comparing services offered by various vendors. It also entails establishing the company’s objectives for implementing an outplacement program and determining the budget allocated for it, prior to commencing any layoffs. 

Here are some ideas you should consider when choosing an outplacement consultant, including what to look for, what questions to ask, and what requirements to set in order to address the unique needs and circumstances of your company. 

Setting Your Outplacement Goals

The initial step towards achieving your goals is to define them clearly. When the imperative arises to optimize your company in response to evolving economic conditions and new market dynamics, it is crucial to have the same level of clarity regarding your goals for an outplacement program.

Before initiating the Request for Proposal (RFP) process, collaborate with your human resources department, senior executives, and key company stakeholders to articulate your expectations for the outplacement program. What outcomes do you aim to achieve when all is said and done?

Consider the following fundamental goals for your outplacement:

  • Assisting transitioning employees in finding new career opportunities.
  • Maintaining positive relations between current and departing employees.
  • Integrating the outplacement program into the company’s business strategy for restructuring and enhanced competitiveness.
  • Contributing to the enhancement of the company’s brand and public image during periods of economic uncertainty.
  • Alleviating the stress of the downsizing process on internal staff.
  • Aligning with the company’s social responsibility commitment.
  • Mitigating the risk of legal liability arising from downsized employees.

Things to Look for in a Request for Proposal (RFP)

After creating your goals and issuing Request for Proposals (RFPs) to various outplacement consultants, the time arrives to select the right outplacement provider for your organization’s needs and goals. 

To help you make this decision, you’ll want to inquire about the following:

  • Does the provider specialize exclusively in outplacement consulting for transitioning employees, or is outplacement offered as a secondary service?
  • What is the provider’s account-management structure and level of experience?
  • How is the service delivered throughout the entire outplacement process?
  • What is the communication strategy between you and the provider?
  • Does the provider have the flexibility to effectively cater to your service demands across the entirety of the outplacement process?
  • Is the provider both willing and able to innovate to meet the evolving needs of your company and departing employees?
  • Does the provider offer flexible hours throughout the outplacement process, and are their services accessible through various channels?
  • Does the outplacement firm provide time-limited services, or does their support extend throughout and beyond the transition period of successful work placement?

Navigating these nuanced considerations ensures that your chosen outplacement consultant aligns seamlessly with the unique needs and objectives of your company for this phase of organizational transition.

Watching Out for Term Limits 

In recent years, the world of job hunting has undergone significant transformations. The advent of the internet and increasingly distributed workforces has rendered traditional approaches like responding to newspaper classified ads or pounding the pavement nearly obsolete. 

Despite these changes, a limited contract term–or ‘term limits’–is still the norm among most outplacement firms. This practice involves outplacement consultants providing support to displaced employees for a specific timeframe, typically no more than three months, to help them secure new employment. At the end of this predetermined window, the outplacement support is terminated, whether or not the participant has secured a new job by then. 

These term limits pose evident drawbacks, as they presuppose that every participant will take the same amount of time to find new employment. They disregard the diverse needs, backgrounds, and experience levels of individual job seekers–such as the varying outplacement needs for executives, mid-level managers, and individual contributors. This approach restricts the flexibility required for a more personalized and effective outplacement process.

The constraints imposed by term limits also suggest that the outplacement consultants lack confidence in their ability to facilitate successful job placements and prioritize their own financial interests over those of the individuals they are hired to assist. From an employer’s perspective, investing in a service without a guarantee, especially one that holds significant personal importance for displaced employees, is bound to raise concerns. 

A more effective approach is to seek out an outplacement consultant committed to working with outgoing employees until they secure a new job, irrespective of the duration. Opting for a provider willing to go the distance reflects both a commitment to the well-being of the employees and confidence in the provider’s ability to deliver positive outcomes. 

This is why, at Careerminds, we offer outplacement support ‘until placement’–meaning until participants have been successfully placed in a new, meaningful role.

Considering the Cost 

When selecting an outplacement consultant, it’s inevitable to ask the question: “How much will it cost?” However, making an informed decision goes beyond a simple comparison of per-person prices for outplacement consultant services between different firms. 

Outplacement costs are contingent on a great many factors, such as the types of services offered, the number of employees, the level of support needed, and other specifications. Before soliciting RFP bds, it is crucial to make decisions about the services you intend to provide to your displaced employees, so you can establish a budget for outplacement costs and adhere to it.

When engaging with potential providers, you will want to inquire about:

  • The pricing model they offer for their various services.
  • The specific services included in their pricing model.
  • The timeframe (if any) upon which their pricing is based.

Look for a provider willing to comprehend your outplacement needs and collaborate on creative consulting solutions and pricing throughout the outplacement process. Typically, technologically advanced providers with lower overhead costs can offer a more comprehensive array of services at a more affordable rate.

For optimal results, don’t be afraid to openly disclose your budget with prospective outplacement consultants. Keeping the budget confidential leaves outplacement providers to speculate on your willingness to pay, or potentially include unnecessary services and features in their proposals that exceed your budget. To receive a proposal tailored to your financial circumstances, make sure you always communicate your budget clearly.

The Cost of Not Offering Outplacement 

Choosing not to offer outplacement to impacted employees in a reduction in force (RIF) event entails risks that can result in expenses far surpassing the actual cost of the services themselves. These risks include damage to a company’s brand, as well as the potential for litigation initiated by laid-off employees who believe they have been treated unfairly. 

On the other hand, the provision of outplacement support not only helps protect against these risks, but can also contribute to enhancing a company’s financial standing by minimizing expenditures on unemployment and health benefits.

Companies that extend outplacement  to their separated employees have reported these types of positive outcomes, including:

  • Increased productivity and profitability.
  • Enhanced employee morale.
  • Reduced turnover, sick days, and recruiting costs.

When selecting an outplacement provider for your organization, make sure you consider the holistic financial impact. Don’t allow the outplacement program cost alone to be the sole determining factor in your decision-making process.

Outplacement Consultants: Key Takeaways 

Outplacement consultants play a pivotal role in a company’s restructuring journey, offering specialized services to guide individuals through the challenges of career transitions. The consequences of mismanaged layoffs and RIF events can be profound, ranging from damaged brand reputation to legal ramifications. Hence, the selection of the right outplacement consultant is a critical decision.

Here are the main takeaways to choosing the right outplacement consultant for you: 

  • Distinguishing Between Roles: Know the difference between outplacement consultants and outplacement coaches.
  • Holistic Outplacement Process: Understand the comprehensive outplacement process, from onboarding to skill enhancement and job search support, to ensure a well-rounded approach for career transitions.
  • Clear Goal Setting: Establish clear goals, including supporting transitioning employees, maintaining positive relations, and aligning with the company’s business strategy. This is the foundational step for a successful outplacement program.
  • Qualities in an Outplacement Consultant: When evaluating potential providers, inquire about proactive employee engagement, clarity of instructions, simplicity of service navigation, and the duration of support provided. Seek a provider who aligns with your company’s values, is strategic, thorough, and views the outplacement process as a shared responsibility and commitment.
  • Term Limits: The outdated practice of term limits, restricting the timeframe of support for displaced employees, raises questions about the provider’s confidence and commitment. Opt for outplacement consultants willing to invest time until job placement, which signals a dedication to the well-being of employees and confidence in positive outcomes.
  • Transparent Financial Communication: Openly disclose your budget constraints to ensure tailored proposals that align with your financial circumstances and prevent unnecessary expenses.

Remember that, although crucial, financial considerations should not be the sole determinant. While transparency about budgetary constraints will ensure more tailored responses to your RFP, the cost of not offering outplacement can far exceed its financial investment. Positive outcomes, including increased productivity, improved morale, and reduced turnover, highlight the many tangible benefits for organizations that choose to provide outplacement support to their impacted employees.

In conclusion, the outplacement landscape requires careful navigation, with a focus on individual needs, organizational objectives, ethical practices, and specific qualities in an outplacement consultant. By prioritizing holistic support, transparency, and a commitment to the well-being of displaced employees, organizations can ensure a successful outplacement process that contributes positively to both individual careers and the company’s overall reputation. 

Look for outplacement consultants who’ll take the time and make the effort to understand what’s important to your company. Find a provider who can be both strategic and thorough, and whose services align with your goals. In other words, look for a partner who’ll view your layoff event and the ensuing outplacement as a shared responsibility, and who, like you, is committed to a positive outcome for everyone involved.

If you’re ready to find the right outplacement consultants for your organization, click below to speak with one of our experts and learn more about Careerminds’ outplacement offerings.

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Cynthia Orduña

Cynthia Orduña

Cynthia Orduña is a Career and Business Coach with a background in recruiting, human resources, and diversity, equity, and inclusion. She has helped 50+ companies around the world hire and retain talent in cities like LA, SF, NY, Berlin, Tokyo, Sydney, and London. She has also coached over 300 people, from entry to senior levels, in developing their one-of-a-kind career paths, Her work has been featured in publications such as Business Insider, The Balance Careers, The Zoe Report, and more. To learn more you can connect with Cynthia on LinkedIn.

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