Although we’re in the midst of an economic recession, we
know we’ll get out of it eventually. Companies that position themselves now for
that upturn will be the ones to take off and grow once the economy turns
around. So, rather than focusing all your energy and resources on surviving the
current crisis, take this opportunity to focus on the future.
In a recent roundtable discussion with 20 of my firm’s
business partners, we came up with the following ideas for managing people
during an economic downturn.
Accomplish strategic tasks that are hard to get to during
the busy boom times. For some businesses, tough times mean that orders are low,
so employees are less busy. Use the opportunity to position your company for
the future. Draft plans to move into international markets or new business
segments. Rewrite company policies to optimize future performance. Engage
employees in meaningful ways, helping them keep their skills sharp and morale
high.
Focus on overcoming your weaknesses. Apply best practices to
bolster underperforming business areas that may have been masked in the past by
strong performance overall. One Seattle-based company hurt by the slump in the
construction industry worked on building up its sales expertise. The company
believes that this groundwork will make it better equipped to not only weather
the current climate but also to better grow in the future.
Acquire talent. The quality of our talent plays a major role
in how well we fare in these challenging times. With the state’s unemployment
rate higher than the national average, now is the time to acquire prime talent
that is becoming available due to layoffs.
Motivate to engage. Engage your existing talent to drive
productivity, which tends to decline as fear and uncertainty spread. A survey
we conducted at the end of 2008 of 62 midsize Washington businesses showed most
of them have identified “key talent” particularly crucial to the success of the
organization. However, none of the companies shaped benefits and communications
programs to address their specific needs. Identify your key talent and
redistribute resources—including benefits, compensation and training dollars—to
motivate this driving segment of your workforce.
Be creative with compensation and benefits. Finding
effective ways to motivate and reward is tough when budget cuts are necessary.
So get creative. If you can’t offer salary increases, consider increasing the
amount of paid leave or introducing flex time or telecommuting policies.
Another effective alternative to pay increases is performance contests with
low-cost rewards. Also, health
care benefits—an expense second only to compensation for many companies—need to
become a strategic priority. Conduct ongoing assessments to learn what those
costs are and how they can be reduced.
Consider outsourcing. Focus on the core business that helps
drive revenues and serves clients, and consider which other functions could be
outsourced. Many administrative tasks, such as benefits eligibility
administration, can be performed by third-party providers more effectively and
at a lower cost. Strategic outsourcing can help cut costs, free up resources
and help focus your existing talent on the areas that truly matter.
We will get through this economic downturn. And when we do,
the companies that are prepared will come out ahead.
Nita Petry is area president of Gallagher Benefit
Services in Washington. Gallagher Benefit Services offers employee benefits
consulting and administration to companies of all sizes. Reach Nita at
nita_petry@ajg.com or 425.454.6000.