Mandatory Cost Cutting is NOT the Answer

red_ceremonial_scissorsThe first reaction of most companies is to start to cut costs during times of crisis.

This approach has short term rewards, but most of the time long term negative effects on the business.
When businesses start cost cutting drive they say things like:
o    ‘cut 20% off all our spending’
o    ‘No more overtime’
o    ‘No salary increases’
o    ‘No catering, for internal meetings’
o    ‘Hiring freeze’ etc
These approaches might all seem like the right thing to do, but they are very reactive approaches.

This approach to ‘managing’ costs can only be for a short period as it can be realistic to never hire anyone again!!

Also this approach can leave employee feeling disgruntled as they have to work with limited resources (people, products, time) and also  start to feel unappreciated. Working with limited resources and unhappy employees has a direct impact on your product /service and can lead to unhappy customers, who will eventually move on to one of your competitors.

So rather than ‘cutting costs’, look for ways to manage your costs and work to having a cost management culture.

Having a cost management culture simply means becoming a cost conscious organization. I would advise that one of the best ways of doing this is by allowing everyone to be part of the solution.

Involve your employees in the cost management of the business, rather than just being on the receiving end of ‘cost cutting orders. Monthly meetings can be held to review the operating costs of the department/business.  I would also show the profit, so they can see the fruits of their labour.  But I know for some businesses this is information they would prefer not to share.

At these monthly meetings, show the costs against budget both the month and year to date and ask questions about the data and set future agreed targets together (focusinng on the high costs areas first).
Sample questions:
o    Why do you think we over spent this month?
o    What was different this month from last month?
o    What ideas do you have to bring these costs down?
o    Is our budget realistic? If not why not?
o    What can you personally do, to reduce the costs in the coming months?
o    What are you thoughts on the quality of the materials we use?
o    How can we reduce the wastage next months?
o    What are your suggestions on how to reduce overtime?

In the following month, review the costs with the team and compare the actuals with the targets agreed the previous month. If achieved, agree how you will celebrate. If not achieved work with the team to find out why and agree what needs to be done differently in the current month.

By involving your employees, they get to understand the impact they have on the department /business expenditure, they feel more informed and more engaged in the business. Also if they are the ones to come up with the solutions, they are more likely to adhere to them and ensure that their peers also follow suit.

I would advise companies to hold this meeting every month, not just in times of crisis.
This approach can become part of how they operate the department/business. Both the management and their employees will develop long term realistic cost management solutions that can achieve huge positive gains for their department/business in the long term.

Georgina Terry
[email_link]

Nine Ways to Achieve Extraordinary Performance in your Team

Dynamic Business TeamEffective teamwork is essential to your organization’s performance.

There are many teamwork definitions, but this is one of my favourites:

A tight knit group of competent individuals who care deeply about each other. They are fiercely committed to their mission, and are highly motivated to combing their energy and expertise to achieve a common objective.’

Are you part of a great team?
If you said yes, what makes your team great? What is your contribution to the team’s success? What outstanding results have you been able to achieve together?
If you said no, what are YOU doing that is stopping the team from being great? Yes, we all contribute to our current situations.
Working with a great group of people, creating an amazing bond and achieving great results, is a wonderful feeling.

There are certain qualities that a high performing team exhibits that will enable you to achieve great things.

Below are nine fundamental behaviours that can help your team achieve extraordinary results:

1.    Totally committed to each other and your overall goal
2.    Curious before critical
3.    Focused on the hope of success
4.    Embrace people for what they bring to the team
5.    Everyone accepts responsibly for all that happens – there is a ‘we’ mentality
6.    Hire the inspired or inspire the hired
7.    There is no room for egos
8.    The appropriate leadership style is found to fit the current situation
9.    The ‘leader’ in each person is given space to be ‘step up’

Which behaviours does you team already possess? When was the last time you saw these being demonstrated?

And which elements does your team need to demonstrate more of?

What more could your team achieve, if you were consistently demonstrating these behaviours? What would it feel like to work together like this? What would others say about your team?

By having faith and trust in each other, ordinary people can achieve extraordinary things!!!

Georgina Terry
[email_link]

The Other Side of The Grievance Procedure

sea-world-kissesLast month I was in San Diego, California for business and was also able to squeeze in some vacation time too.

While in San Diego, I went to Sea World and I strongly recommend that if you are ever in that part of the world; you HAVE to go to Sea World. Anyone who really knows me, will tell you that I am not an animal lover, but the shows are amazing.

The common practice of the trainers is to reward the sea lions, dolphins, whales etc. when they perform their tricks.

This practise of rewarding really got me thinking.

In the business world how often do we really reward the people around us, when they achieve something? I know many organisations have grievance procedures, poor performance processes, but how many organisations have a ‘well done’ procedure as part of their business culture?

How do you show an employee true appreciation for a job well done? Is this part of your business culture, or just something you choose to do, because of your personality?

What also struck me during the show, was that the animals were rewarded with fish and ice!! Ice…No flavour, inexpensive, yet they still enjoyed it. So we don’t need to spend lots of money to show appreciation…sometimes a simple ‘Well done, great job’ will be music to someone’s ears.

But what if an employee does something and it fails. Should they still be rewarded? I would argue yes…. they can be rewarded for stepping out their comfort zone and trying something new and challenging and with the right coaching you can turn a perceived failure into a great learning experience.

When someone feels truly appreciated and valued, they will start to perform at their maximum potential, which will reap great business results for the department and the organisation, as well as personal development results for the individual.
For example – ‘The Walt Disney World Resort established an employee recognition program that resulted in a 15% increase in staff satisfaction with their day-to-day recognition by their immediate supervisors. These results correlated highly with high guest-satisfaction scores, which showed a strong intent to return, and therefore directly flowed to increased profitability.

Likewise, Sears, Roebuck & Co. found for every 5% increase in employee attitude scores, they saw a 1-3% increase in customer satisfaction and a 0.5% increase in revenue.

On the other hand, the cost of extremely negative or ‘actively disengaged’ workers comprises about 10% of the US Gross Domestic Product annually, including workplace injury, illness, employee turnover, absences and fraud.

It costs virtually nothing to show appreciation, but the rewards to everyone involved can be HUGE!!!

Georgina Terry
[email_link]

Nine Ways to Achieve Extraordinary Performance in your Team

Business TeamEffective teamwork is essential to your organization’s performance.

There are many teamwork definitions, but this is one of my favourites:

‘A tight knit group of competent individuals who care deeply about each other. They are fiercely committed to their mission, and are highly motivated to combing their energy and expertise to achieve a common objective.’
Are you part of a great team?
If you said yes, what makes your team great? What is your contribution to the team’s success? What outstanding results have you been able to achieve together?
If you said no, what are YOU doing that is stopping the team from being great? Yes, we all contribute to our current situations.
Working with a great group of people, creating an amazing bond and achieving great results, is a wonderful feeling.

There are certain qualities that a high performing team exhibits that will enable you to achieve great things.  Below are nine fundamental behaviours that can help your team achieve extraordinary results.

1.    Totally committed to each other and your overall goal
2.    Curious before critical
3.    Focused on the hope of success
4.    Embrace people for what they bring to the team
5.    Everyone accepts responsibly for all that happens – there is a ‘we’ mentality
6.    Hire the inspired or inspire the hired
7.    There is no room for egos
8.    The appropriate leadership style is found to fit the current situation
9.    The ‘leader’ in each person is given space to be ‘step up’

Which behaviours does you team already possess? When was the last time you saw these being demonstrated?

And which elements does your team need to demonstrate more on?

What more could your team achieve, if you were consistently demonstrating these behaviours? What would it feel like to work together like this? What would others say about your team?

By having faith and trust in each other, ordinary people can achieve extraordinary things!!!

Georgina Terry

[email_link]