In the current challenging times I believe there is too much talk of businesses needing to lay off staff as the solution to possible downturns.
Even though all of us may be facing more challenging business times, slower growth and for some reduced turnover and lower profits- you need to think very seriously before you decide to terminate any staff.
For the majority of businesses, employees are your number one resource. Sure, they may also be one of your biggest costs — but more often than not they are your greatest asset. So don’t forget that!
Think about the diverse skills and experience you have in your team, and how beneficial and essential they are to your business.
More often than not they are the backbone of your business; the ones who develop or manage your systems; the ones who deal with the customers and suppliers; the ones who get the admin tasks done.
Maybe there would be a short term cost saving if you decided to terminate some of them. And yes, sometimes there are staff who do not perform well and cannot make the grade and you need to make the hard decisions about them.
But think about what it has cost you in $’s and time to get the majority of your staff to the level they are at. From a variety of industry and academic sources the dollar costs of recruiting, inducting and training staff is conservatively costed at $5K to $50K depending on skills levels, etc.
That could be a lot of your investment dollars going out the door if you decide to reduce staff numbers without seriously thinking about the implications.
I encourage all businesses to try and think of creative and practical ways to retain your staff through this business cycle. If you get rid of them now, who is going to be there to help you grow as the cycle picks up?
- The Federal government is pouring money into programs to stimulate and retain employment levels, so try and tap into those. There could be funding to upgrade your staff’s skills through subsidised training — make the most of that.
- Utilise some of the federal funding to actually put on a trainee or apprentice — go on buck the trend and give someone a chance to get that first real job.
- Approach your staff to negotiate more flexible work arrangements- maybe shorter hours, take unpaid leave, job sharing etc. I have one client who has already negotiated a 9 day fortnight with employees, and this allowed them to retain all staff and not have to make anyone redundant.
- Talk to your staff and keep them informed of what is happening in your business- be open to their suggestions and ideas of working through the challenging times together. Remember, they are as concerned about your success and viability as you, as they don’t want to lose their jobs.
These current business times are going to be challenging for many, but it is in fact a time when the flexible, innovative and pro-active business owner can add value and set themselves up with a winning advantage to move into the next growth cycle.
If you are looking for practical ways to keep your team together, please give us a call on 03 9397 0871 and we would be happy to work with you.
