Surviving the slowing economy
My Miami Herald column today explored what employers and employees are doing. Some workers are carpooling, working harder and longer, updating their resumes and considering second jobs. Some are giving up some free time to concentrate on learning new skills. At the same time, employers are scrutinizing expenses, eliminating overtime, cutting some perks and postponing projects.
I asked Dale Carnegie's CEO Peter Handal to weigh in with his advice for coping with the financial pressure we all feel right now. Here are his tips:
For the employers:
*Do not fire top talent. Top talent is the single most important variable in innovation. When you fire experienced employees, you are not only cutting costs, you are cutting revenues.
*Re-research your customers. Successful companies do not abandon their marketing strategies in a recession; they adapt them. Instead of cutting your market research budget you need to know more than ever how consumers are redefining value and responding to the recession.
*Emphasize core values. This is the time when CEOs should go out of their way to spend more time with employees, which will effectively elevate their sense of importance to the company. Studies have proven that employees who are engaged are 43% more productive. A recession is the perfect time to pull out all the stops.
*Keep in touch with your clients. As the main source of income, keep up with your clients. Ask if you can’t help them in more arenas or offer more services. Think beyond your usual menu of offerings.
*Spend money only if it makes more money. Regardless of economic conditions, never spend a dollar unless you feel certain it will result in a sales return of $1 plus something for net profit before taxes.
*Inspect your internal operations. Conduct thorough analyses of your organization’s operational procedures to determine how to cut costs, reduce duplication of work, increase productivity and improve fiscal oversight. Money and time are always saved in reviewing operations that could be accomplished by fewer people with the same or a greater level of proficiency.
*Outsource. As a last resort, look into outsourcing some of your business processes including payroll, IT and other operational processes. If these areas can be handled on a part-time basis by a freelanced entity, you could save a bundle.
For the employees:
* Network, network, network. While networking is always important, during tough times we must raise our visibility and keep our radar wide open to be aware of as much information as possible. This is a time to differentiate ourselves by interacting with more people.
* Be a good listener to your clients. During economically challenging times, people have fears and concerns. People need someone to listen to their thoughts, ideas, concerns, and desires. If we become too focused on the near term business and are not listening to the full needs of our clients, they will begin to feel that we only want their money.
* Be prepared. Build an emergency fund. Continue contributing enough to your retirement plan to get the full employer match, but consider putting any extra savings in your emergency fund until it is sufficient.
* Do due diligence. Do homework on your company, or the company you are thinking of applying to work for, to learn how well positioned it is to survive a downturn. You can prowl the Internet, check out the business press, visit a business librarian or go talk to a stock broker. However, if you are already losing sleep over the economy, you’ll want to explore a move to an industry better able to withstand turbulence.
Are you feeling the economic pinch? How are you coping?