When it comes to cutting your management and executive staff, the need for delicacy increases with a different dynamic. This is not the level where a group announcement is made. In all likelihood, these people have been reading their and the company reports and are astute enough to know that management cuts will have to be made, it's only a question of which are the most critical and cannot be sacrificed.
Where the cut is with upper management, in most cases there will be more publicity as it has more impact on how the balance sheet and stock price will behave. The cut will also affect public opinion of the company.
In this instance, there are three scenarios but they come to the same treatment. In one instance, you have a leader who needs to be removed because of balance sheet issues or because of malfeasance. In another situation, the removal is because of ill health, external difficulties that are impairing performance and judgment, or inability to do the job in the corporate setting. The third is in a nonprofit organization where the leader has the same challenges.
Corporate laws set forth the legal way of dealing with these situations and indicate when the leader would be advised to step down. It also provides the mechanisms for their doing so or their removal by the body of members or the board. However, it is quite embarrassing when a leader is asked to step down in front of the entire body or it's publicized that their removal is set and they haven't been counseled beforehand nor discussed the matter privately. Leaders want to save face and maintain a standing in which they can move themselves to a new situation without tarnish.
So it's a good idea to schedule a meeting with the leader and discuss the situation with them, either privately or with one other person. Allow the leader to open up and discuss the issues that are impacting their performance. Allow them the room to make the decision to leave or take a hiatus.
If after the person has had an opportunity to see the facts for what they are for themselves and still resist, the suggestion will need to be made in a subtle way. It's best that it be couched in terms of giving them time to heal and recuperate or get things under control -- whatever wording is appropriate to the circumstances. If the person volunteers their resignation or leave of absence without inducement, don't resist it. To resist accepting the resignation will give the appearance that things are still okay and will force them to remain in office. That's counter-productive to the original goal of the meeting.
In Unequivocal Terms
Should the leader either not understand the invitation or resist it, the matter should be stated in clearer terms during the same meeting. If the resistance persists and the situation is compelling, there is no alternative but to tell them it will be necessary to present their removal to the body and tell them why. Most people will want to resign on their own initiative, especially after this type of candid discussion. Then it's only a matter of working out the details of timing, exit packages, and other concerns.
East Meets West
While saving face is usually thought of as an Eastern concept, no matter whether the person is in the East or West, and no matter where they are in the organization, saving face is an important matter when it's necessary for them to leave. Making allowance that, making the exit as gracious and painless as possible, will create much more goodwill and good relations in the long run.