Managing staff through the tough times

FROM THE PENNSYLVANIA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS

Owners of small businesses face many tough challenges in a troubled economy, including managing a staff. Whether it's keeping anxious employees focused on their work or making hard decisions about layoffs, company owners often find themselves wondering what the best steps may be.

Be realistic

If the business is experiencing financial troubles, the news probably will have spread through the company grapevine. Don't try to pretend that everything is rosy. Instead, be upbeat but realistic in your dealings with employees. You might acknowledge that the company has lost a big client, for example, but point to the other steps you are taking to adapt to changing times and to find opportunities. This will reassure employees that company leadership is dealing with the problems, making it easier for them to concentrate on their jobs rather than worry about survival of the business.

Focus on opportunities

Employees are well aware of all the problems a downturn can bring. That's why it's a good idea to remind them that a recession also provides potential for opportunities. Salespeople might be able to pick up new clients when competitors cut back operations or shut down, for example. Employees who manage vendor relationships may find it easier to cut better deals on contracts, too. Consider brainstorming with your staff to identify all the opportunities open to your company and develop ideas on how to make the most of them.

Find the upside

If overtime and long hours are a normal part of doing business at your company, a slow economy can provide some needed downtime for hard-working staff members. Instead of allowing employees to become anxious about the downturn, encourage top people to take the vacation time they have accumulated or to use slow periods to catch up on projects that often get pushed to the back burner during busier times. Once again, you're taking a consequence of the bad economy and finding a way to turn it into a benefit.

Consider layoff alternatives

Cutting staff when business is slow can be a wrenching decision for company owners, especially when you know that employees will have a rough time finding new jobs. Dropping to a smaller workforce level also may leave you at a disadvantage when the economy does turn around. Instead, examine all your alternatives. Freezing salaries, hiring or benefits, for example, can prevent further increases in expenses. Salary cutbacks can make it possible to hold on to the same number of people for a smaller outlay, as do furloughs, in which employees are given days off without pay during slow periods.

These steps can help you maintain your experienced workforce and keep staff off the unemployment line.

For more information about Pennsylvania Institute of Certified Public Accountants (PICPA), visit www.ineedacpa.org.

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Cutting staff when business is slow can be a wrenching decision for company owners, especially when you know that employees will have a rough time finding new jobs.