| Call it a slowdown or a recession, the impact is nearly | | | | time of cuts cannot be underestimated. |
| the same - our businesses are challenged and we | | | | • Senior management should feel the effects of |
| have become desperate to find ways to respond. We | | | | the first cuts. In an intellectual age, employee loyalty is |
| feel the urge to cut expenses, eliminate programs and | | | | critical. If employees see that all cuts are at their level |
| benefits, and put customer and employee | | | | and not first with those who are more significantly paid, |
| development on hold. Our knee-jerk reaction to this | | | | they will not buy into the changes. This will be evident in |
| slowdown pressure encourages us to do all of the | | | | the quality of their work. The goal is to make changes |
| wrong things. | | | | AND win employees into continued performance. CUT |
| True, we must eliminate wasteful spending; it should | | | | senior manager perks and compensation; BUILD |
| never take a recession to drive this thinking. We must | | | | rapport by sharing information about this first round of |
| always assess the impact of our spending on | | | | changes with all employees. Employee support will be |
| performance to determine its return and effectiveness. | | | | significantly improved as they see all levels of the |
| However, in today's intellectual environment, this review | | | | organization change in response to the challenges in |
| process is not strictly empirical. Today, we must also | | | | the economy. |
| assess how recession decisions affect employee | | | | • CUT wasteful perks such as company meetings |
| morale, engagement and performance. Sure, cutting a | | | | with no real agenda, or golf or social outings with |
| percentage of the 401(k) match or deleting a holiday | | | | limited (business) purpose. Instead, BUILD by hosting a |
| gift program may cut expenses from the bottom line. | | | | sales or company meeting with a clearly defined profit |
| But they may also have more a more significant | | | | purpose; use a powerful performance speaker and |
| longer-term impact on profitability as employees | | | | create specific individual performance requirements |
| disconnect from the organization. | | | | from the meeting. Follow up with employees to |
| Loyalty is the key to success in any type of economy | | | | implement changes. CUT the bar bill and the fancy |
| - employee loyalty and customer loyalty. Employees | | | | meals; BUILD performance by spending on speakers, |
| must be loyal to create loyal customers. So, as | | | | coaches and tools to build performance, then hold |
| recession-inspired actions cross your desk, be sure to | | | | employees accountable for using what they learn to |
| evaluate them not only for their bottom line impact | | | | implement new ways to drive results. |
| today, but also know their impact on your employees | | | | • Be honest with employees about difficult times; |
| and their engagement level for tomorrow. | | | | share the numbers so that employees understand the |
| We are in an intellectual economy; the industrial age is | | | | critical financial picture. Many times employees are |
| all but over in the U.S. as much of manufacturing | | | | willing to make cuts and changes when they see the |
| moved offshore. We are left with the intellectual or | | | | reasons and are given the facts. CUT limited and |
| service economy. The success of this economy now | | | | hearsay communications; BUILD rapport by being |
| rests in the minds and hearts of our employees - | | | | honest with employees and sharing the facts. Also, |
| those employees who choose to build strong | | | | send a letter to employees' homes to be sure |
| relationships with customers, or not. Our success rests | | | | accurate information is shared with families as well. |
| with those employees who are matched to their roles | | | | Employee loyalty is affected by what spouses and |
| so that they are excited and engaged about making a | | | | partners feel about the organization as well. |
| difference in their work, or not. Our success rests with | | | | The most significant way to recession-proof your |
| those employees who actively and innovatively think to | | | | business is to change your understanding of the roles |
| drive new services, responses and opportunities for | | | | of employees. As author Tom Peters says about |
| the business, or not. Value in our workplace is in the | | | | today's economy, "We are in a brawl without rules." So |
| connectedness and performance of the employee; this | | | | cut the old definition of employee that requires them to |
| value does not respond well to industrial age expense | | | | just show up and do what they are told. Instead, build a |
| cutting as the solution to a recession or slowdown. | | | | powerful recession-proof workplace by allowing |
| Today, the employee chooses his degree of | | | | employees to own a larger portion of the results, ideas, |
| commitment based on the things he experiences in the | | | | policies, and services. Offer education, skill |
| workplace. In effort to cut expenses, be aware of the | | | | development and learning to expand employees' |
| impact on the employee, his attitude and therefore his | | | | perspectives and invite opportunity thinking. Encourage |
| engagement. A couple of dollar savings today may | | | | employees to take performance risks to win |
| significantly affect the employee engagement and | | | | customers, invent efficiencies and see possibilities |
| quality of workers in the future. | | | | instead of limitations. Get more from each employee |
| To recession-proof your company in an intellectual | | | | by igniting his performance by spending in areas that |
| age, consider this "cut (the waste) and build (the value)" | | | | drive engagement. |
| strategy: | | | | The recession is here; recession-proof your business |
| • Most businesses are service which means | | | | by remembering where value is - in your employees' |
| employee-related expenses are the greatest expense | | | | hearts and minds. Cutting expenses that impact this |
| captions on the Income Statement and therefore the | | | | may save a dollar today but will cost you $10 next |
| first to be targeted for cuts. Review all | | | | week. Be wise by understanding that today's |
| employee-related expenses and assess those that do | | | | intellectual workplace does not respond in the same |
| not make a significant difference to the employee; | | | | way our manufacturing or industrial age workplace did. |
| survey employees to determine the benefits that have | | | | To combat slowdowns in that era, expense cutting |
| greatest value. CUT those that do not add value; | | | | was key. Today, spending wisely, holding employees |
| BUILD value by adding small high-impact benefits at a | | | | accountable for performance and building a more |
| time when the rest of the business world is cutting. | | | | positive workplace is the key to surviving and thriving in |
| The positive emotional response to an "addition" at the | | | | a slowdown economy. |