Bad News Got You Down?

Two months ago, my eight-year-old daughter asked for some help with a current events project. Primary tutor mom was away so I raced out to the nearest convenience store and bought a copy of every daily paper that I could get my hands on. We opened them up, spread them out on the kitchen table, and got bombarded.

It seemed every page had articles about layoffs, poor earnings, “cooked” books, and struggling companies — and that was just the business section. The rest of the paper had stories about war, kidnaping, and terrorism. Really upbeat.

Talking to my buddies in the industry, talk inevitably turns to trucking companies that are on the rocks. Makes you wonder who’s next.

Guess what? Your employees are thinking the same thing. They read the papers. They hear rumours. How they react to bad news will depend on how confident they are that their own jobs are safe. When work is a positive and rewarding experience, people shut out the negativity they’re getting everywhere else and do a better job.

Yet as a company manager — more to the point, as a leader — tough times require tough choices. If your company is fighting for survival, you’re no longer trimming fat. You’re making decisions about things that directly affect the rank and file. Like wages. Or their very employment.

If you’re a boss, you have a big impact on how your employees feel and think. I believe you can find something positive in just about everything, even when you know the outcome could be painful. Here are some ideas.

THE WORKFORCE. No doubt, some of the layoffs you’ve been reading about were necessary to keep businesses viable. But no right-thinking company owner or manager wants to cut staff. Downsizing might benefit the bottom line in the short term, but it can have a long-term negative impact on morale and productivity. Many owners would rather take a cut in pay than have to hand out pink slips.

However, there’s a theory about layoffs espoused by Jack Welch, the former CEO of General Electric, whose recent autobiography found its way into the Christmas stockings of managers and manager-wannabes everywhere. Welch says that every year you should get rid of the worst-performing 10% of your workforce. No exceptions.

So how does that boost morale? It’s a good bet the 10% you’d cut are recognized by the other 90% as a drag on the company. Your best employees understand this better than anyone, and you most certainly don’t want to lose good people during the slow times. You’re going to need them when business gets better, and besides, hiring and training people is expensive.

PAYROLL. How do you trim payroll without eliminating bodies? Here are three ideas:

– Be flexible. Look at options like four-day work weeks, working from home, job sharing, and extra unpaid vacation. Don’t be surprised if the teacher’s spouse in your billing department doesn’t jump at the idea of having the summer off, even without pay.

– No more automatic raises. If you hand out raises every year, you’ll end up with a 10-year receptionist making $60,000 a year. That doesn’t work in our business model. Offer one-time bonuses in lieu of an annual raise. Your employees might like cash up front and, since raises compound annually, you’ll save a lot of money in the long run.

– Reward performance. Successful pay-for-performance systems have several things in common. You always reward based on a goal that the person’s function has direct control over. (This means aligning long and short-term goals.) As well, whatever your bonus is based on, make sure it’s measurable and in no way subjective.

TRAINING. Lulls in the action are great opportunities to cross-train your employees. Learning about all of the functions within the company and working alongside different people and doing unfamiliar jobs makes people think out of the box. When was the last time your sales manager went in a truck to Chicago and back?

FUN. You spend so much time at work, you might as well have fun while you are there. To get your staff involved, give them a small budget and let them loose. Potluck lunches, sports pools, and 50-50 draws are just a few things you can do to make work less mundane (be sure to include your drivers). Remember, most people don’t leave for monetary reasons. Make work fun and your good employees will stick around.

Look and see how you can use these uncertain times to your advantage. I used them to get an A-plus on a Grade 2 social sciences project.