| This is a period of serious economic despair. Large | | | | is not the only section of the company that is affected |
| companies are losing their market value, revenues are | | | | and they share collective responsibility in company's |
| taking a downward plunge and huge losses are being | | | | well being. |
| incurred. As a result companies have to take extreme | | | | Partial salary cuts |
| measures to sustain the heat. They lay off people, | | | | Salary cuts may be termed as harsh measures but |
| shut down departments/offices, minimize budgets and | | | | comparing it with alternative measure of firing |
| make many more such harsh sacrifices. Laying off | | | | employees and considering the earlier mentioned |
| workforce must be the hardest decision any company | | | | measure of cutting executives' and higher |
| has to take. Therefore, companies try hard to find | | | | management's pays, this may not actually be that |
| alternate measures that can save them substantial | | | | much harsh. Every employee can share the burden by |
| amount of expenditure and avoid the extreme step of | | | | letting the salary reduce to some extent thereby |
| laying off employees. Here are some of the common | | | | saving many jobs in the company. |
| and effective methods that the companies are | | | | Reducing travel costs |
| employing to this effect. | | | | Companies that have geographically distributed offices |
| Stop hiring new employees | | | | and operation centers will be able to reduce |
| The very first obvious step would be to stop hiring | | | | expenditure substantially if they plan employees travels |
| new employees. This wouldn't require a spark to | | | | and meetings carefully. Companies should avoid every |
| comprehend that when you are not able to afford | | | | possible travel for work or meeting. Even specific |
| even the existing people, there is now way at all you | | | | departments such as sales and marketing that require |
| can hire new ones. One scenario where companies | | | | lot of travelling can cut on costs. Alternative |
| will still be hiring is when they are replacing their existing | | | | communication modes such as telecommunications |
| low performing employees with new, more qualified | | | | and video conferencing can be used keep the work |
| and capable prospects. With lots of jobs being lost and | | | | going without incurring substantial costs. |
| even talented people left jobless, companies definitely | | | | Unpaid Vacations/Compulsory Holidays |
| get a chance to improve the quality of their workforce | | | | Temporary holidays can be provided to the client |
| by getting to choose the best ones. This will help the | | | | wherein the employees may only be paid a |
| companies in the long run. | | | | percentage of their actual salary but will have the |
| Limiting work hours | | | | security of job. They will be able to come back and |
| Employees definitely prefer working for lesser hours | | | | easily start working again after sometime thereby |
| and being paid accordingly instead of being rendered | | | | allowing companies to cut pay expenditure without |
| jobless completely. Therefore, companies are reducing | | | | firing employees |
| the work hours from 40-45 hours per week to 30-35 | | | | Work from home |
| hours per week or even less. Employees who are not | | | | Allowing employees to work from home whenever |
| dependent on just the salaries on month-by-month | | | | possible and utilize telecommunication when required |
| basis are going to accept this policy happily. | | | | can substantially reduce operational costs. Daily |
| Offering flexible scheduling | | | | required expenditure of in-office food, electricity and |
| Along with reducing work hours, companies also give | | | | maintenance can be avoided through this measure. |
| choices to the employees of working schedule with | | | | Whenever and wherever the presence of employees |
| some minimum compulsory requirements. This avoids | | | | in office is not imperative, allowing people to work from |
| the perception of something being imposed upon the | | | | home should be a part of cost-cutting strategies. |
| employees and gives them some sense of respite as | | | | Reducing corporate activities like parties, recreational |
| well. Employees will appreciate the companies' | | | | tours and internal promotional activities. |
| consideration of their freedom and will stay motivated. | | | | All the companies organize internal as well as external |
| Controlling office expenditure | | | | activities such as corporate events, parties that can be |
| This may seem to be a very superficial and limited | | | | avoided during hard times. Internal activities such as |
| measure, but practically speaking, limiting expenditure | | | | team building exercise, team tours, competitions and |
| office expenses like stationery, small operational | | | | recreational activities which are organized to boost |
| expenses etc. can substantially cut costs especially in | | | | employees' morale may be reduced or eliminated |
| large organizations. | | | | temporarily. |
| Cutting on Executive-level salaries and bonuses | | | | These are some really effective and acceptable |
| Small cuttings in the paychecks of highest paid people | | | | measure which can be employed by companies to |
| in the companies can help in saving hundreds of lesser | | | | reduce their spending substantially without resorting to |
| paid jobs. Many companies are following this trend. | | | | the harsh and extreme step of firing its employees. |
| Salary cuts of CEO's, co-CEO's and senior | | | | This will also keep the employees satisfied and |
| management helps companies save a lot of money. It | | | | motivated. |
| helps them assure the employees that the work force | | | | |