You know it: Preparing for layoffs will be a key part of the job for many CIOs in the months to come. Economic upheaval forces cutbacks in projects and people. Need a history lesson? Look back to the dotcom bust, then consider that the current financial mess touches many more industries and many more countries.

Showing good workers the door when business contracts is one of a leader's toughest assignments. The key to getting your department through layoffs with minimal damage is to downsize thoughtfully and decently. (Read "Why Talent Management Matters").

Doug Cormany, senior vice president and CIO at Preferred Care Partners, a Medicare Advantage Plan headquartered in Miami, has laid off technology staff a few times during his 30-odd year career as a CIO at the staffing firm Spherion and at the equipment rental company formerly known as NationsRent, among others. He never likes the task. What he dislikes even more are those instances he's seen of IT leaders doing it badly. Cormany, a member of our CIO Executive Council, spoke with CIO magazine Senior Editor Kim S. Nash about the right way and the wrong way of telling your people they've got to go.

CIO: IT layoffs have already begun. But not every CIO does it well. What's your experience with handling this kind of bad news?

Doug Cormany: I do that as part of doing turnarounds. At Spherion, for instance, we had numerous disparate systems and we knew that once we got over to PeopleSoft applications, we would have a reduction of workforce. So over the course of two years, I had to let go 152 information technology services people. I outsourced [another] 63 people. That's the biggest layoff I've done.

How did you figure out who would stay and who would go at Spherion?

We did an assessment of the skills of each IT employee. We had each one assess his own skills, then we had supervisors assess each employee. We had the next level—the directors—look at them. We also brought in [management from the] business, to ask them about the people we had assigned to them.

Once we had that process finished, we said, "What is the 'to be' organization going to look like in two years? What skill sets will be needed? What did the job descriptions look like?" Then we started placing names in each position.