Working with Clients to Create a Post-Crisis Job Retention Schemeby
The COVID-19 pandemic has shut down many sectors of the U.S. economy and caused widespread job losses. Right now, many of your clients are looking for strategies to stem losses, re-forecast budgets, pivot their business model and implement new cash management strategies.
More importantly, whether your clients know it or not, they also need help maintaining and activating their most valuable asset – their employees – to ensure business continuity. Here's how:
Avoid a Negative, Reactionary Mindset
With sales and revenue suddenly falling off a cliff, your clients may be hyperfocused on cutting overhead. Labor costs are a tempting place to start because it’s a substantial line item. However, it’s important not to let your clients get into a “cut, cut, cut” frame of mind.
Of course, we don’t want to discount that clients need to react to the economic effects of COVID-19. These are extraordinary times, and every business needs to deal with them. At the same time, clients must think about the big picture. They’ve invested heavily in their talent to get them where they are today. Pulling the trigger on quality people in the name of cost-cutting will have long-term ramifications – both in the cost of replacing them later and the hit on morale.
If your clients are considering cutting top performers, encourage them to take a step back from the ledge. Help them identify other ways they can save dollars or generate new revenues.
While we need to be cognizant of the financial side and maintaining cash flow in a crisis, cutting staff should be a last resort.
Trim the Fat
Until recently, employers were enjoying the longest economic expansion in American history and dealing with record unemployment numbers that made it difficult to hire good people. For that reason, many companies were a bit lazy about culling non-performers.
Your clients will have an easier time confronting layoffs if they’ve already identified people with performance issues and a poor attitude. If your clients still have employees who shouldn’t be there anyway, ensure they’ve addressed the HR and legal matters and let them go – they’ll be doing the rest of their team a favor.
Consider Alternatives to Layoffs
Financial realities may necessitate cutting expenses, but temporary salary reductions, reduced hours and pay, or unpaid furloughs are preferable to layoffs – for both employees and employers.
If your clients intent to go this route, ensure that leaders and upper management share the pain. Leaders who inflict hardships on employees while continuing to enjoy generous salaries and bonuses for themselves won’t receive loyalty from the surviving staff, or consideration from future potential hires.
Encourage clients to lead from the front instead of letting their people bear the brunt of the hardships. This will help demonstrate that they are an attractive employer, during both good times and bad.
Encourage your clients to focus on truthful, consistent communication with their staff. Have an “open door policy” – figuratively if not literally – so employees who want to talk about what is going on can feel comfortable coming to them. When employees ask questions, answer them as honestly as possible.
This builds trust with the remaining talent and discourages them from leaving the organization as soon as the economy starts picking up.
If possible, your clients should consciously involve staff in the decision-making process around cost-cutting measures. Consider forming problem-solving groups focused on finding solutions to problems and developing new revenue streams. This motivates staff, helps give them a sense of control during a difficult time and provides an incentive for them to remain with the organization.
Recognize Hard Work and Contributions
Your clients may be going through a difficult time, but it’s still necessary to pay attention to employees who are doing good work and recognize their contributions.
Encourage your clients to let people know they are appreciated, and the hard work they’re doing makes a difference. That recognition doesn’t have to cost a lot. A kind word or a free lunch can go a long way toward nurturing those relationships.
Continue to Invest in Growth
In many organizations, one of the first areas to face downsizing and budget cuts is marketing. But that is often one of the worst decisions your clients can make during tough economic times.
Rather than eliminating marketing and sales staff, consider what your clients can do now to come out of the current situation ready to leap-frog over the competition. Sales and marketing is the way to do that.
In discussions with our own clients, we spoke to a firm that hired a business development professional shortly before COVID-19 hit. If they hadn’t filled that role before the crisis, they might have used it as an excuse not to make the hire. However, that person has helped them start all kinds of client conversations and set up meetings that they wouldn’t have done otherwise.
Continuing to get new business may be the thing that keeps your clients afloat during these times, so encourage them not to cut investment in the business’s growth.
Get Creative with Benefits
During challenging economic times, many business owners expect employees to stay simply because they feel fortunate to have work. However, layoffs, budget cuts and poor morale can cause top talent to leave at any time. If your client wants to hold on to those employees, they need to give them reasons to stay.
While monetary incentives might be difficult to come by, they are far from the only benefit employees value. Consider other benefits that have little or no cost, including:
- Advancement opportunities
- Additional professional development and training
- Flexible schedules
- Paid time off
- Wellness benefits
- Paid volunteer time
Different people are likely to prefer different sets of benefits. For that reason, your clients may want to allow employees to choose benefits and perks from a menu of options rather than trying to find a one-size-fits-all solution.
Layoffs may be a necessary step for many businesses. Still, companies that indiscriminately terminate employees without looking for alternatives may be accused of an uncaring attitude, or worse, blithe disregard for human welfare. A reputation for ruthlessness won’t work in their favor in the future, and scaling back up post-crisis may cost more than those measures save right now.
In the long term, it’s far better to retain the talent they currently have on board, by whatever means necessary. Things won’t always go smoothly. But as long as you and your clients keep the company and their team’s best interest at heart and involve employees in the decision-making process, they can get through anything life throws their way.