The new year is only just underway but, many people I’m speaking to have a similar story when it comes to work – “we’re being asked to do more, with less”.
Maybe you’re fortunate and not in that situation, but the common theme in business discussions now is around organisations putting more demands on an already pressurised workforce, and people are struggling.
For some, organisations have implemented severance schemes with employees being released in an attempt to make the balance sheet look a little healthier.
Others are seeing compulsory redundancies where valuable team members are being lost from their teams.
However it is that the staff numbers are being reduced, the workloads certainly aren’t reducing, in many cases, they are continuing to increase.
For others, it’s the challenge brought on by gaining new business and workloads increasing significantly as a result, but, the workforce has remained the same. The same size workforce that was in place when the business was new and growing is certainly not resourced for the scale of business now being experienced.
Businesses are facing many challenges in this modern World, especially when it comes to finances, and I recognise that addressing the salary budget is a seemingly obvious step, however, this decision should not be made solely as a financial one.
When you make the decision to cut staffing levels as a cost-saving option, you send a message to ALL employees that you see them as nothing more than a business expense, and there are consequences for this.
1. You’ve confirmed they are ‘just a number’
No one likes to feel like ‘just a number’ when it comes to work but this approach, gives that exact message, “you are a number on a spreadsheet with a cost attached and we no longer want those costs”. Whilst that may be true, it’s not a good message to put out there.
Worse still, is the impact on the people left to pick up the pieces and keep delivering for your customers.
2. You are prepared to pile on the pressure
Not only have you made it clear that they are seen as a cost on a budget spreadsheet which could be cut at any time, but you’ve also told them that you are knowingly and willingly prepared to put them under extreme pressure in order to protect your profits.
Whilst FTE reductions can be a source for good, for example, encouraging innovation and process improvement which allows people to work smarter, more often than not, it creates a culture of demotivation, stagnation, and discontent because no one has the time, energy, or inclination to drive improvements. In such cultures, no one ever feels valued or respected.
3. You don’t respect the value they bring to the organisation
Sure, if the business was to go to the wall, then everyone suffers, but what seems to be forgotten in most cases is that the people you’re letting go, or are going to pile more work on, are the very people that could help turn the business around. They’re the ones working with your systems, processes, and looking after your customers, they have a lot more insight than you may think. Releasing people makes remaining staff feel less valued and less inclined to want to support with the challenges. But, protecting people where possible, and using their knowledge, experience, and insight, gets everyone on board, breeds loyalty, and encourages the workforce to want to protect the business.
You often hear Managing Directors, CEOs, senior leaders etc… talk about how “our people are our biggest asset”, yet they don’t utilise this asset appropriately when the going gets tough. Instead, the asset becomes a liability that they want to release.
4. The mental and physical damage
More pressure and increasing workloads is reasonable and okay for short periods, but, we’re at risk of it becoming the ‘new normal’, perhaps we’re already there?
As such, being under constant pressure and strain will lead to burnout, where people are breaking down mentally or physically, or both!
What do you do then? You let people go, piled the pressure on the remaining staff to the point they’re now off due to work-related stress, so you’ve no one to do the work, and you also need to manage the sickness absence, costing the organisation even more. It a vicious cycle but any employee that has been pushed to this extent, is not going to return the same loyal, hardworking, committed employee they once were.
“How you treat your employees when times are tough is far more important than how you treat them when times are good.”
Steve Cooper, 2024
I’m not saying cutting staff isn’t a reasonable business decision, of course it is. All I’m encouraging you to do is think about the full consequences of the decision beyond just the short-term financial benefit.
Customer satisfaction and long-term success will not be delivered by a burned-out workforce.
Think Can Will 