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Employees are Ready, Willing & Able to Help

December 31st, 2008 · by Justin Fogarty · 1 Comment · best practices, skills rectruitment and development, spend analysis

Last week, the NYTimes reported on the growing trend of companies trimming labor expenses - in the form of salaries, benefits, forced furloughs, 4 day work weeks, etc - rather than slashing headcount.

“Companies taking nips and tucks to their work force say this economy plunged so quickly in October that they do not want to prune too much should it just as suddenly roar back.”

They emphasized that years of strict hiring has left companies with lean, extremely capable workforces. Who would want to risk losing that talent, lest they end up scrambling to restaff when the economic winds shift.

But what really struck me about the articles were the stories of shared sacrifice. The fact that the workforce is often times ready and willing to join in the cost cutting efforts says one of two things: either the employees are willing and able to collaborate with their employer to improve the health of the company OR they are simply scared of the facing unemployment (personally or for their coworkers).

I doubt any company is this day and age is so narrowly focused that they only look at labor costs, when there are sooooo many other ways to be lean and mean in this down economy that is RIPE with opportunity for direct and indirect spend savings! But I’d suggest that a smartest companies are cutting costs and retaining good talent by enlisting the help of their employees.

As this NYTimes article suggests, if you are clear about the goals AND stakes, your staff may be ready, willing and able to do their part. Provide them with the tools and processes to contribute. If your employees are collaborating with management on spend management with the ultimate goals being financial health for the company AND job security (not to mention satisfaction), everyone can win.

After all, if employees are already willing to give up part of their compensation to keep the company books in the black and prevent layoffs, don’t you think they’ll be a great tool for more robust, strategic cost cutting?

Justin Fogarty is Managing Editor of Supply Excellence. For any questions or feedback on the blog or its contributors, Justin can be reached at jfogarty[at]ariba.com.

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1 response so far ↓

  • 1 SEKHAR VENKATACHALAM // Jan 3, 2009 at 12:52 am

    I whole-heartedly agree with your comments. I have personal experience of turning around two companies as their CEO in the face of severe down turns, enlisting the support of employees in productivity improvement, energy usage reduction and spend optimisation. No other accomplishment in my career has given me the degree of exhilarataion that I got from averting the job losses in these companies ( 600 in each case) and saving the families from near disaster . Human Capital should not be treated as an easily expendable commodity. And you can certainly count on it to rise to the clarion call of ’sacrifices’.

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