In these tough economic times, the ability for companies to become more profitable is being challenged not only by a more competitive business climate but tremendous business uncertainty, which is caused by the government. Moreover, many organizations must deal with inflation, which is increasing commodity costs in an environment where these additional expenses are difficult to pass along to customers.
In such a situation where everything is in flux and everyone, it seems, is demonizing business while simultaneously asking it to hire more and increase its costs, you must do everything you can to become and stay profitable.
These are the steps I would prescribe to help your company become and stay profitable:
1. Eliminate waste at every level, scrutinize every cost, and do it publicly. The worst thing you can do is allow an environment to flourish where workers believe management does not care about costs.
2. Have no sacred cows. Look at everything from a fresh perspective.
3. Be transparent. Some managers may be concerned about sharing too many facts with workers, but the reality is rumors can be much worse than the reality you share. If your company is in a cash crunch, discuss how you plan on getting out of it and how the team can come together to help you get through it.
4. Talk to the star performers separately let them know how valuable they are. Be sure to do everything you can to keep them with you as you navigate tough times. Offer them incentives to stay on and continue doing positive work.
5. Use technology and cloud-based applications from companies like Google and Salesforce.com that are often a fraction of the cost of in-house solutions that require servers and at tech support team.
6. Explore unified communications and VoIP to save money and allow you to take advantage of lower-cost workers who are not physically located in your office.
7. Find freelancers to help lower cost and pay them based on performance. Use sites like Craigslist and Elance and others specific sites in your industry.
8. Consider a shorter workweek four days instead of five or a week off over the holidays or summer. Unemployment payments from the government will offset some of the financial pain this could bring on.
9. Solicit ideas from your team on how you can lower costs, and give a reward to the best suggestion.
10. Do not cut the little things like bagels, donuts or other cultural cornerstones of your company.
11. Remind everyone that most companies and industries go through cycles: GE was thought to be going bankrupt, GM needed government assistance to survive, and so did AIG and myriad banks.
12. Look at recognizing top performers in other ways besides using money: Give awards for best performer, best team player, and best customer support, etc.
13. Hold regular meetings to ensure people see you are confident about the company’s future. Remember, your fear and concern about the future can be amplified by your workers and can do worse harm to your business than the original problem.
14. Do not be aloof or act in any way that will make your workers think they aren’t appreciated.
15. Have a vision for the company’s future and share it frequently nothing is worse than working in the dark in an uncertain economy.
Rich Tehrani is CEO of TMC, a global media company serving the communications and technology markets and reaching over two-million global decision-makers each month. Many of the ideas above have been gained from navigating a publishing company through the tech and telecom bubble bursts of 2001 and transforming an organization relying on revenue from printed magazines into one which generates most of its revenue online. His company can be reached at tmcnet.com and his blog is located at tehrani.com.