The Layoff Question (Part 1)

Layoffs hurt.

Ask any of the estimated 50-70% of Americans who are one paycheck away from financial ruin, or any middle manager who's just been handed a headcount or payroll number he must meet.

Unfortunately, a market like 2008 means that companies have to make some difficult choices. Even firms with proud track records of never having laid off in their history are making cuts. However, I'm confident the amazing American economy will see brighter days. In the meantime, here are a few ideas for companies looking to optimize future performance.

First, shine some light on your non-compensation costs.

What would happen if a company made its budget internally-public to its employees? While senior management can do a certain amount of high-level cost cutting, employees will be able to cut much more precisely because they're on the front lines and know exactly how certain measures will impact them. Some ideas may be extremely easy to implement like replacing paper coffee cups with mugs or automatically printing 2-sided copies. Others may involve vendor switches based on personal relationships senior management might not know about (i.e. the accountant who's married to the VP-Sales of an office supply vendor and can get you a better deal). A team building contest to see who can eliminate the most waste from their department with a prize people care about like extra vacation time or dinner with the CEO would likely generate ideas with cumulative savings worth far more than their cost.

Second, make continuous cross-training a part of every department.

Service reps who can also process business are more likely to have both have less downtime and integrate valuable suggestions from customers. Processors may be fried at handwritten order forms. Customers may complain about the slow speed with which orders get processed. If there were a way to have orders entered directly on line into the database, both the speed and accuracy problems could be solved. There's tremendous value in asking your employees on every team "What tools do you need to make your job easier?" Very often, these will line up with the corporation's goals.

Third, create as many "producing team leaders" as possible.

If a company is trying to eliminate non-revenue generating positions, it may helpful to divide the part of the work load that can be divided among the team, give the team leader a raise or extra bonus to coach/mentor the team and hold him responsible for 60-80% of the work load (to leave room for mandatory responsibilities like reviews, interviews, etc) of a non-team leader. By the work that can be divided, I mean attending management meetings, running non-confidential reports, doing business analysis. If you work with a team of high achievers, sending a non-manager to speak for the team may yield similar results. Alternatively, if you have a low-producing or split team, this is a great opportunity to find out what's holding them back.

Employees, freed up and given the tools to be amazing, will astound you every time.

I am a self-confessed Left Brainiac

The left side of your brain is rational. I don't have anything to back this up, but I think the left side of my brain must take up at least 80% of the total space, because things that don't make sense drive me nuts.

I love efficiency. I started on my process management kick in middle school, when my friends would tell me they were hungry. That thought, plus an old green duffel bag from my dad and $20 in seed capital from my mom (she was my original angel investor!) put me in business selling candy bars. Everything went in a black and white spiral notebook - how fast inventory was turning over, profit margins, even candy weight - when you're carrying your entire supply on your back, it takes on more importance! I switched out my Snickers for Blow-Pops in the spring because the mark up was higher. Also, chocolate and sticky Cincinnati summers aren't the match made in Heaven one might think.

Fast forward 20 years. I'm now an adult with a responsible job, a FICO score and my own bottle of fabric softner. I still have the kid in me saying "You know what would be awesome... !" and filling in the blank with some crazy idea. Then there's the other part of me that's already mentally forming a spreadsheet with a cost-benefit analysis, timeline and project scope to see if that thing I was just dreaming of is a good idea.

My favorite equation: Goals = Dreams + Deadlines