WTB v.38.0

Winning the Recession

All indicators point to the entire balance of 2009 being a struggle in nearly all sectors. So how does an organization continue to grow and improve at a time when revenues are down? The knee-jerk is to stop spending:  Capital expenditures; hiring freezes; putting new systems in; implementing new processes; furthering training; implementing new marketing programs to stimulate business.  But, is that really the way to pull through the Recession?

Let’s follow that theoretical path to a 2010 using the ‘put on the brakes’ approach to running a business:  First, by freezing capital expenditures that would enhance productivity and could make an organization weather the storm easier by 2010, this company will actually be in a poorer condition to rebound. The best time to incorporate changes on a production line, implement process improvement initiatives, etc., is when orders are slow and your people can have time to learn the new systems and practices.  Further, by pulling back on purchases, you further the Recession by forcing your vendors to lose sales in 2009, creating a snowball effect.  Cutting back on Professional Services and staff may save cash in the short term, but the firms that you rely on in good times could possibly go out of business while you delay or freeze projects and programs you’d had planned.

In regard to staffing:  Hiring freezes and layoffs make more work for your already overworked staff, enhance errors and waste, again becoming part of the burgeoning snowball of national unemployment, causing a longer Recession.  Holding off on ‘Key Man’ hires, in particular, is simply the wrong choice.  A quick SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis of any one role in the company can tell a Talent Acquisition team whether adding one person (even at the executive level) would actually save money, or raise sales volumes / margins to the point where it costs the company more NOT to make the hire.

To outsource the search to a search firm or not:  Once again, in the overmatched HR arena, simply forcing your in-house Talent Acquisition people to add all recruiting at all levels, the inefficiencies may outweigh the cost-per-hire of this same individual.  A better solution might be, to hire a specialist search firm to find the best talent, pay the fee and to amortize that cost line item over the lifetime value of the hire, rather than seeing it only as an expense.  Investing in your primary assets—your people, is never costing a company.  It’s time to re-evaluate your goals, your needs, your market and your strategy for winning the Recession and being in the best possible position to profit from the inevitable recovery.

Good Hunting ©2009