All signs point to a deep and perhaps prolonged recession. It's tempting to relax regarding your workforce, thinking everyone feels lucky to have a job and unlikely to search for a new one. That may be true, but what you do now impacts how your company thrives once we come out of the recession. At that point, your best people may be looking to take advantage of the improved job market.
With sales tight, you may not want to make expensive investments, but modest planning can pay a bonus for your company when the economy reverses.
Now's the time to assess the strengths and weakness of your organization. While you may be asking your people to "do more with less," how can you unlock their creativity to actually improve productivity? How can you ensure your best people feel committed and energized? In troubling times, the most important thing you may do is to communicate with your workforce. What is the most effective communications approach? How do you ask for sacrifices in a way that your human capital embraces?
Over the next few issues of the Human Capital Advisor, we will be examining these issues.
Let's start with sacrifices.
Your company may not have had the bottom fall out, but certainly, collectively, the ground beneath you may seem like you're walking on a water bed, uncertain whether your next step will result in a fall. Communicating the sacrifices the company needs to make is important, but the first step is make sure those sacrifices are shared broadly. That way, people don't feel they're being singled out. Sure, you may need to let some people go (and that presents some legal issues we'll discuss in a future HCA newsletter). But those who remain must feel that you are all in it together.
Be straightforward, open and honest about your organization's financial condition. An employee who is fairly informed tends to be productive and more of an advocate for the organization in troubled times.
Sacrifices must begin at the top. The CEO needs to make clear to everyone what he or she is willing to sacrifice and what top management will be doing without -- or less of, or more of (work responsibility, etc.)
Engage second-tier managers to outline the sacrifices they can make. In fact, asking everyone for cutback ideas is a smart move.
Let everyone know the thinking behind the call for sacrifice. How does your company's goals, objectives, strategies and tactics change? What must the company sacrifice now for long-term success later? The time frame depends on the severity of the recession. Today, it seems an 18-month horizon is realistic. Make sure your call for sacrifice has a "deadline" in the sense that you don't want your workforce to believe that sacrifice is permanent; otherwise, they will be burnishing their resumes starting now. That's a mindset you want to avoid.
This is the time to evaluate much of the legacy work everyone might be doing. What can be stopped during the recession? What will help achieve the changed objectives and what can be delayed?
Unfortunately, some cuts in your workforce may be unavoidable. How you do that can make a big difference on how you're positioned once the recession is over. Also, doing it right can keep you out of court or the EEOC office. EEO claims spike during a recession. We'll discuss that issue in an upcoming HCA newsletter.
Meanwhile, if you'd like to discuss how your company can best navigate this recession, give us a call at 703.978.4333 or drop us an email.
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