Keep your Greatest Asset

Employees are the best source of cost-saving ideas

Source: Business Development Bank of Canada (BDC)

Many employers view layoffs as an unpleasant, yet inevitable consequence of a recession, and for certain industries, that may well be the case. Other companies do have options. Just ask your employees.

“Nobody is smarter and more observant at seeing the real nitty gritty of a company than its employees,” says Mary Karamanos, Senior Vice-President, human resources at the Business Development Bank of Canada. “They often have creative ideas on how to reduce costs, boost efficiencies, improve sales and marketing, and identify new markets for your products and services.”

There are two key advantages to this approach: In difficult times, people want more than ever to contribute. Also, employees are more willing to embrace change if they are consulted beforehand. Throw the challenge out to your employees. Some may be interested in shorter work-weeks for a few months, or a partial paid leave to travel, volunteer, go back to school or care for an ailing parent. But unilaterally deciding that all employees will begin taking every second Friday off unpaid, for example, or cutting benefit plans, will do nothing to boost staff confidence and loyalty in your firm.

“For this to work, you need to tell employees how much you appreciate them doing this, and how this benefits both them and the organization,” says Iain Morris, a principal with Mercer’s human capital business. “You also have to stress they will have a job to come back to when the furlough is over, or if they agree to work 10% fewer hours over six months then after that six months you won’t force them to continue at that reduced work level.”

Appreciation can also come in the form of some sort of reward recognition. If money is tight, get creative. Try recognizing outstanding job performance with weekend trips, movie tickets or house cleaning services.

“Non-financial recognition is always something you want to be promoting in your company,” says Karamanos. “It could be a trophy or a small celebration, or even a couple of tickets to a game. You don’t always need a big, fat bonus cheque to say thank you.”

Talk to your employees
The most successful managers have learned that being open and honest when communicating with employees will go a long way in helping companies weather difficult times.

At the professional services firm Deloitte & Touche, for example, a blog has been created where employees can post ideas on how to improve productivity and effectiveness. Kathy Parker, a consulting senior manager at the firm, says people tend to respond best when they feel they have a sense of control over their destiny.

“It’s also a great way to unleash their creativity,” she adds.

Whether you have a blog or not, Parker says it’s important to have regular one-on-one meetings with your team to keep abreast of front-line activities.

“Efforts to create frequent, consistent and concise communications are never beyond the means of any sized firm,” says Parker. “It is particularly important to keep your high potential talent engaged at a time when it might be very easy for them to feel uneasy or uncertain about the company’s stability.”

And don’t take away the treats!
Having motivated employees is essential for any company looking to increase efficiencies and boost productivity. This can be a particular challenge when people are worried about job security, paying for their children’s education and saving for retirement.

Morris stresses the importance of being clear and realistic about the company’s direction, expectations for the future and what actions your organization is taking to get there.

“If people don’t know what the heck is going on, then you get the deer-in-the-headlights behaviour,” he says. “But if you’re clear about your expectations and set interim goals that are realistically achievable, then your employees will have something to strive for. It becomes very motivating.”

Brian Lindenberg, a worldwide partner with Mercer in Calgary, cautions that companies should also avoid doing away with small perks, the treats, to save small amounts of money. Cutting out free beverages, for example, may save the company a few bucks each month, but employers will pay an even higher price in lower morale.

Another misstep employers should avoid, adds Lindenberg, is expecting other workers to pick up the slack when layoffs do occur.

“It’s essential that you either stop doing this work, or improve the work processes so it can be done more efficiently,” Lindenberg says. “If you simply load up your staff with 10% more work for the same pay, you will end up with staff who are less productive and far more stressed.”

Published in Your Workplace magazine issue 11-6