Dear Pearlcatchers
I am MD of an SME and like many organisations, we are suffering from the current economic downturn. To ensure that we survive until times are better, I recently took the very hard decision to make two staff redundant. As you can imagine this has had an impact on morale – whilst people are grateful that I am doing something now rather than let the whole organisation go under, they are struggling to cope under the increased work pressure as well as worrying about what will happen next.
There is so much doom and gloom out there at the moment that it is really hard to keep everyone motivated
I read a couple of articles recently that talked about the negative impact of stress – which can have implications on health, sickness
How to manage stress
While the recession becomes visible in the form of job losses and businesses facing financial difficulties, the invisible effects of stress are likely to be just as damaging and require very different responses. Whether you are a one-man band or you employ staff, it's important to deal with pressure.
Stress can undermine effectiveness, cause a rise in sickness absences and increase staff turnover. If you employ staff, you have a legal responsibility to ensure your employees don't become ill, either physically or mentally, because of work-related stress.
Tackling stress
These steps need not cost a lot of money and the benefits can be significant in terms of productivity and motivation of yourself or your staff.
A good first step is to assess stress levels in your business by carrying out a stress audit. See our guide - Opens in a new window on how to assess whether stress is a problem for your business.
Tackle the causes of workplace stress
Once you've identified possible stress problems in your business, you can then take steps to tackle the causes:
Work-related stress
- If overwork is a problem, consider how you might reduce workloads. Ensure targets are challenging but realistic. Help prioritise work, cutting out unnecessary tasks and using time-management training if necessary. Encourage delegation of work where possible, and try to delegate work yourself.
- Make sure staff take their holiday entitlement - and take your own.
- Check individuals are well-matched to the jobs you give them. Make sure your recruitment and selection procedures help you to achieve this.
- Make sure you and every employee has a well-defined role - and that you all know what this is.
- Review people's performance so that they know how they're doing and you can identify any training they may need. Don't forget to look at your own performance.
- Where possible give employees more autonomy, allowing them to plan their work schedule and decide how to tackle problems.
- Adopt a management style that encourages employees to discuss problems with you. Provide them with opportunities to feed back to you or express ideas about their work.
- Keep staff informed about your business' direction and make sure you tell them about significant changes to the business.
- Ensure you have effective disciplinary and grievance procedures to tackle bullying and harassment.
- Stress can be caused by too little work as well as too much. Ensure your staff skills are recognised and developed so they can be of maximum utilisation.
Manage your time
Ensure you adopt good time management techniques so you can provide a model for staff behaviour: avoid too many meetings, ensure you leave enough time for travelling, don't put things off or get distracted by other jobs, make sure your paperwork is in order and not strewn all over your desk. These are simple things you can do to help manage day to day tasks better.
Adopt flexible practices
Look at different working hours for employees who struggle with other commitments at home (stress in the workplace can be a result of stress at home). Read our new flexible working guide:
Flexible working - the law and best practice. - Opens in a new window
TALENT CRUNCH
How to keep your staff motivated
Many UK companies are reacting to worsening conditions with reduced headcount – often the more experienced and expensive employees are 'let go' first and the remaining employees have to work harder and smarter, foregoing pay rises in the short term to remain in employment.
Unforeseen consequences
For those who do survive there are potentially even greater challenges ahead. Human Resources and Operations experts have identified and named two “syndromes” which have hit past recession-surviving companies:
Syndrome one: Survivor syndrome
After a round of redundancies employees may experience a sense of relief that they have still 'got a job'. Once this has subsided, the realisation sets in they have escaped at the expense of their colleagues, who are often close friends. They experience feelings of guilt that while others have lost their jobs and livelihood, they remain more secure in post. This guilt may then turn inward and become anger which is directed at their employer who they see as the architect of their situation, with the result that:
- morale falls, and with it productivity and overall performance - the key objectives of the down-sizing;
- loyalty is compromised so when the up-turn comes, many of the survivors will look for employment elsewhere.
So the employer is left with a situation where they have met their objective of reducing costs, but not increasing performance. In addition, having let some 'talent' go, if they do not address the 'survivor' issues, they are also reducing their own capacity to 'survive in the long term':
Syndrome two: Talent Crunch
During the last recession some organisations encouraged senior (expensive) employees over 49 to take early retirement. This they did, with many subsequently taking their experience, skills and market knowledge to work for competitors, severely jeopardising their previous employer's ability to remain competitive through 'corporate amnesia' due to a failure to capture the tacit knowledge of their former employees. As a result, when the economy started to recover they were not strongly positioned to take advantage of market opportunities, or to fully meet customers' expectations of products and service levels with more junior staff – they faced a “talent crunch” exacerbated by the fact that many of their former employees now worked for competitors.
So what's the solution?
'Successful organisations … will be organisations that have a plan to retain genuine talent and don't rashly cut back on investment in skills. They will also be … best able to weather the storms of recession and be ready to prosper once the deluge has subsided' ¹
Training
Yes, this means spending money – but it is investment in human capital which will have the following outcomes:
- Training motivates – overcoming survivor syndrome
- Training increases the skills base of the organisation – addressing the talent crunch
- Performance and productivity improve, not just in the immediate term but also into the future
- Dependency on out-sourcing is reduced while opportunities for diversification develop
- Employees feel they are valued and their efforts are recognised when companies invest in them
- Employees are more likely to embrace change, providing a more flexible and competitive workforce
- Retention rates improve and churn decreases
All the above will result in lower costs and an increased revenue-generating capacity for the organisation. In the medium term, training can be cost neutral. Companies can take advantage of the 'down time' provided by slower trading conditions to look at their skills base, identify training needs and support employees through their development. In real terms, sponsoring an employee on a training course may cost only a fraction of a pay rise in more buoyant times, but have considerably higher intrinsic value to the individual.
Source: Gill Waters , Senior Examiner Marketing Operations, Chartered Institute of Marketing: Lecturer, Oxford College of Marketing .
¹John Philpott – Chief Economist CIPD -
Read Pay Attitudes Barometer Press Release from CIPD - Opens in a new window 2nd January 2009-01-26
2009 is going to be a tough year but there are ways to mitigate the risks for businesses.
Reduce costs and wastage
- focus people development on what delivers best return on investment.
- embrace a culture of change
- improve leadership skills
Investors in People is a proven business tool that can help companies adapt and improve.
Find out more at the Quality South East website - Opens in a new window.