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As the market slides and company layoffs and reorganizations mount, many companies are cutting spending and looking for ways to weather an evolving economic storm. As companies look for opportunities to reduce burn injuries, the first thing to cut back is investment in employees.
Over the past two years, businesses have faced unpredictable disruptions — from the pandemic to climate change to geopolitical turmoil — that have forced leaders to rethink business continuity and resilience. As a result, companies have finally put people first. Leaders have learned to listen to what their employees and candidates want.
But the market is changing, and instead of holding onto the talent that leaders have worked so hard to recruit, retain and cultivate, some companies are at risk of leaving their employees behind. Ultimately, your people will feel the lack of investment in them and may consider moving to organizations that still prioritize people.
In the current climate, the need to reduce costs is very real for many organizations, but we also know that it is incredibly costly to lose employees. Whether voluntary or involuntary, employee turnover is expensive. It costs organizations 1.5-2 times the employee’s salary, including dedicated time and resources to recruit, onboard and train a new team member. In challenging markets, it’s even harder to absorb those costs — not to mention the hidden costs of revenue, such as increased responsibilities for the remaining employees, decreased productivity, lower morale and lost employer confidence.
This is why now is the time to take extra care of your staff. People are the foundation of a strong business and their well-being is at the heart of your business continuity plan.
Related: Creating a Resiliency Plan for Your Business
Invest in your people
Now, more than ever, it is imperative to invest in your employees. In reality, retention remains important, even in the face of economic uncertainty – you need to retain your people to drive growth. But in difficult times, employee morale usually suffers. Accordingly, it can affect productivity, which is especially critical in a turbulent market. This means that now is not the time to stop with employee experience activities. Investing in team building and meaningful experiences will instead convey the message that you value your people, and it will instill confidence in your organization’s growth.
Investing in your employees does not only mean awarding a financial investment. Consider how you can leverage existing resources to improve employee processes, workflow, and communication. On the same subject : Bowman’s Travel Diary: It’s Not All Chaotic. For example, temporarily reassign an affected department to focus on the employee experience. If hiring slows, consider deploying your hiring team to support employee enrichment.
Successful, resilient companies are built in difficult times. While it may be a tough market today, keeping perspective and thinking long term is essential. If you lose a top performer during this time, what impact will that have over the next 12-18 months? Once you’ve weathered this storm, you’ll have to figure out how to get out of the other side. That’s akin to retaining your workforce, especially your top performers.
Related: Investing in your people is investing in the future of your business
Commit to transparency
Building a culture of trust starts with transparency, from both leaders and teams. In fact, a Harvard Business Review study found that 58% of people trust strangers more than their own boss. People need context and transparency to do their job well, especially in uncertain times. This may interest you : Hajj tech is changing pilgrimage. Your team wants to hear from you — and they want to know that you and your leadership team have a plan. Silence can be dangerous, and that’s when people misinterpret and speculate, ultimately leading to culture damage.
When employees get a complete picture of your company’s health, it’s easier for them to understand how they fit into the bigger picture strategy. For example, company-wide meetings are critical. However, they are only as useful as the information you share. It’s important to celebrate milestones and talk about strategy, but it’s just as important to guide your entire business through your KPIs. If possible, share your high-level corporate finances with employees — the truth is always better than the rumor mill.
Transparency becomes especially necessary when your org chart changes. After significant workforce disruption, people need to know who to report to, who their cross-functional partners are, and where to turn for help. When your organization is transparent, your people will be better able to remain agile in a changing landscape.
Related: How To Lead With Transparency In Times Of Uncertainty
Look for consolidated solutions that drive efficiency
During a tough market, you may get some reluctance from your finance leaders to scrutinize your tech stack and vendor spending. Still, cutting back on investments in key systems can ultimately reduce your organization’s productivity and efficiency. See the article : 3 Pleasant Surprises Netflix Just Gave Investors. This is closely related to your retention and the experience of your people. If your employees find themselves taking on more work, removing resources that help them do their job is likely to worsen morale and employee sentiment.
Instead, look for ways to consolidate your tech stack and suppliers. Find partners who can help you do more with less. Investing in multi-purpose solutions empowers your employees by helping them stay flexible and productive while keeping expenses under control.
Efficient, consolidated solutions can also provide the foundation for streamlined processes and a single source of truth, driving efficiency. Too often, using multiple spreadsheets and vendors leads to disparate sources of information. It can be difficult to find information when you need it, and if you do, it may not be updated. Consolidation is not only the key to investing in your employees, but can also be the catalyst for more efficient processes.
While we have no control over how long this period of economic uncertainty will last, we have the power to build resilient companies that can withstand challenging times. Your people are the anchor of your business, both in good times and in bad. While it’s only natural to think about ways to save, don’t lose sight of how it affects your most valuable assets. If we invest in our people today, we will not only come out stronger, but we will be better able to cope with future business disruptions.
