Cut Cost Without Cutting The Staff Force

Maintaining Full Staff Force While Cutting Costs: A Strategic Approach

• Understanding the need to cut costs without reducing staff force
• Strategies for improving staff skill set and productivity economically
• Innovative ways to remunerate staff without increasing financial strain
• Fostering staff loyalty as a cost-effective measure during financial crises
• Balancing a lean staff force with maintaining efficiency in operations

A. Understanding the need to cut costs without reducing the staff force.

normally a lot of businesses during the downturn, face a lot of pressures, the first thing they will do is to cut cost in order to survive the down turn.

Most businesses know surviving the downturn need to cut cost, however, do they do the right thing in reducing cost?

A lot of time, businesses just cut the head count, as the cost cutting is very obvious and immediate.

say you have 100 staffs, and if you reduce the staff force by one third, that mean you lay off about 35 staffs, you save at least 100,000 per month in term of salary.

However, the issue most businesses seem to overlook is the cost involved when situation get better and you need to get more staffs in.

The opportunity cost is the one every one seem to overlook.

B. Strategies for improving staff skill set and productivity economically

instead of laying off workers during the downturn, businesses should try to improve the staff skill set and productivity economically.

during the down turn, since business will be slow, this is the time to send the workers to improve their skill set.

it is also the time to see how to increase the productivity of the workers.

by sending them to train, and help them improve, the workers will appreciate the businesses effort, and will be grateful that the business take care of their welfare in time of challenging business environment.

if the workers are appreciate and grateful, they will learn more and help the company to tie over the down turn.

C. Innovative ways to remunerate staff without increasing financial strain

If a business is innovative, it will find a way to remunerate the staff without increasing the financial strain of the company.

one of the best way to reward the staffs is to make them feel wanted and appreciated.

Perhaps the company can consider giving some shares to the workers and this way, they will feel since now they also own some shares of the company, they will put in more effort and productive output.

AS no one wants to lose whatever he owns.

D. Fostering staff loyalty as a cost-effective measure during financial crises.

How to foster staff loyalty as a cost effect measure during financial crisis?

a lot of businesses may think it is not worth any effort to do so.

Loyalty of staff nowadays does not seem to be in the mind of the employees.

if you look at the trend nowadays, a staff staying at a company, the most is 2 years, seldom you see a worker stays in one company for more than 5 years.

Likewise, employer is not willing to invest so much in employees welfare as employer thinks it is not worth the effort at all.

Employers seem to have the impression that if they invest in employees, they are only helping others to train the staffs.

so how do we foster staff loyalty?

As mentioned above in C, one of the way is to have employee share option scheme,

Respect and trust work both way, if employer does not think employee is worth investing, employee will think no worth to go all out to do his job after all his effort is not appreciated.

Especially during financial crisis, if the employees feel that there is no security in their jobs, they will not show their loyalty at all, as the threat of anytime they will lose their job will put them under undue pressure.

If every day you have this threat hanging over your head, will you be able to be loyal to the company you are working in?

E. Balancing a lean staff force with maintaining efficiency in operations

A lean work force with efficiency in operation is the challenge companies are facing nowadays.

Unless the bosses are willing to work the ground and find out what actually happening in their operation, they will not be able to understand the workers on the ground are facing.

Some management only know in theory lean work force equal low cost in operation.

However do they know lean work force may also be stressful for the workers at the ground level who may need to work overtimes to finish their job.

Are you able to balance this lean work force and efficiency in operation?

Do you really understand the processes and what kind of work force is required in order to achieve the target set?

Most management will take the easier way out by cutting work force, they do not care how the left behind work force complete the job. all they are interested in the result.

Without knowing the process, only emphasis on results, in the short term, it may look good, in the long run, the bad effect may surface.

One of the bad effect will be the staff will be leaving, when he reaches his breaking since he has increase work load and not properly compensated for his output.

In the short term, he may just take it and work on, after he reaches his breaking point, he will realize it is not worth putting the extra if his health and family life is affected.

After all, money is not ever thing, the most important is you may earn good money, the issue is do you have the luxury to enjoy the money you earn.

You will find that al the money you earn is to buy the health you are craving for.

In conclusion, is there any business out there which really care about the welfare of the staffs or they are just chasing their bottom line and please the shareholders only?