Note from Jan: This is the third in a series on managing tough times. For full benefit, I encourage you to read: 4 Musts for Managing Tough Times & Hunkering Down before reading this article.

So —are you using all of your strength?

The best success I’ve experienced with big budget problems (other kinds as well) came about by involving others.  Staff members always came up with far more ideas than I did on my own (one time we came up with a list of 100 ways to save money!). Plus they were much more committed to the plan since they helped develop it. Some of them even got excited about finding ways to save money.

Managers often worry, though,  that involving staff could open up a can of worms. Or worries. Both possible. Both valid concerns.

But most likely – the staff is already worried. About financial stability of the company. About job security. And if they are getting no information from you, they are most likely making it up in their own minds or in little discussions by the water cooler and in the parking lot.

Wouldn’t it be great if that energy was focused on something that could have a positive impact on the financial health of your organization?

Remember Sally from the first article in this series? She has a staff meeting coming up and has decided to devote the entire meeting to the design of her expense reduction hunker down plan.

Let’s listen in on Sally’s meeting to hear her approach for enlisting the knowledge and strength of her staff.

The focus of our meeting today is the financial health of our organization. With everything that’s going on around us these days – it’s hard not to wonder and worry. So I thought it would be helpful to give you an update on where things stand for us here. And then I’d like your help on determining some next steps.

First for the update:

If my worst case revenue projections come true – we will have a $250,000 shortfall this year – which puts us in a bad situation with the bank.

We certainly aren’t going to settle for this worst case scenario. We are taking charge. Staying out there. Acting boldly. And working on strategies for doing more of the same in order to boost sales. I’ll be asking for your input on that soon.

Today, I’d like your help on the expense side. In case our revenue boosting plans do not work, we need to find a way to reduce expenses by $250,000. $275,000 would be even better.

I’ve informed Bob (the boss) about this situation and he is very appreciative and supportive of the approach we are taking on this. I have promised an update and a plan to him by next Friday. So I have to make quick decisions.

But right now I’m just trying to come up with a long list of possibilities – as many as possible – as wacky as possible. I’d like your help generating that list. And then I’ll have to cull through them and decide by Friday. I’ll share my list with Bob and then with you at our next staff meeting.

In case any of you are feeling nervous, my first choice is to accomplish this goal without cutting jobs. I cannot promise that at this point. But it is my preference. If you have been thinking about quitting and haven’t told me or if you are interested in reducing your hours, please tell me ASAP because it will make this process easier.

Meanwhile – here’s your assignment. I’d like each of you to pretend you are the Chief Financial Officer of this company. Here is a list of our expenses for the year. Looking at this, and knowing how we do day to day business, what are your ideas for ways to save money? Break out of the box. Think wacky thoughts. The only rules are to keep the best interest of our customers in mind and to remain socially and environmentally responsible.

Does anyone have any suggestions right off the top of their head?

Any area where you find yourself asking: “Hmm…I wonder why we do it that way?”

A couple of lighthearted suggestions came out and Sally wrote them up on the board.

She knew they needed time to absorb the information and that some of the staff members were hesitant about speaking up and so she asked them to brainstorm in two’s for the next 10 minutes. That gave everyone a way to feel safer and to become more familiar with the numbers.

After 10 minutes, Sally asked each group to share ideas and she recorded them on the board.

Knowing that some people still didn’t feel safe and knowing that the best ideas were probably still in the incubation stage, she made this request:

If you come up with additional ideas during the next 24 hours, just come in and add them to the board. If you want to suggest something anonymously, feel free to type it and tape the paper on the board. Or if you want to discuss your idea with me, just let me know. At the end of the day tomorrow, I’ll collect all the ideas and then it will be my job to sort through and select the “winning” ideas which I will share with you next week.

Sally’s staff trusts her and that provides a good foundation for managing worries and worms.

Her simple and straightforward explanation of the situation and necessary next steps was effective. She was careful to insert her preference early about not cutting jobs. And very careful about her word selection – stating it as a preference not a promise.

She also made it clear that Bob knows what is going on and is supportive of the efforts.

And she made it very clear what she will do with the ideas that her staff takes the time and energy to share – that she will review and decide and share the final decision next week.

For less experienced managers or for managers who haven’t yet established such strong trust with the individual members of the team – a one on one approach might be better, though more time consuming.  This would involve individual meetings with each person – the same explanation and requests as Sally used above – just without the brainstorming parts.

If the manager makes it safe. If the manager asks encouraging questions to draw out more information. If the manager doesn’t interrupt creative flow with long explanations about the reasons things are the way they are. Or responses such as – “we can’t do that”, “we’ve tried that before”, or “that would never work” – then it’s amazing the ideas and solutions that can come from these efforts. Things like:

• duplication of effort that someone had noticed but was afraid to mention
• an antiquated system that no one had questioned because it was so ingrained in “the way we do things”
• a time consuming report system that no one reads or uses
• volunteers willing to reduce hours or benefits
• holding meetings via telephone or web conference
• getting rid of the office water cooler
• gathering office supplies into one central place instead of having multiple “silos” that are being stocked
• stapling paper from the recycle bin into notepads instead of buying pads of paper for in house use

Avoid the common mistake – I’ve certainly made it – of gathering all these great ideas on the flip chart, white board or file folder and letting them sit there.

Act boldly.

Decide and implement as many of the ideas as possible – as quickly as possible. Some of them are no brainers. They will save you money. They don’t affect quality or service or value or morale.  What have you got to lose?  Start saving NOW!

On some of them – you might feel you need additional information.  Use all your strength. Ask someone (not a committee!) to get the information and bring it and his recommendation to you tomorrow at 2:00pm. Not to leave it on your desk. It will get buried there. Instead review it with him then – at 2:00pm. Ask questions. If more info is needed, ask him to get it for you by a certain time.

If you don’t have time to cull through all the the ideas right now, ask someone on your staff who knows the business and its finances real well to go through the choices and make recommendations to you.

If any promises were made to the staff – like the one Sally made to inform her staff of her decisions at the next staff meeting – fulfill them. Otherwise credibility will be lost. As well as support and enthusiasm for the plan. And a huge loss of much needed strength to implement the plan. And you can’t afford that.

Because you need all your strength to monitor progress. To keep score. To cheer efforts and progress. To re-direct when needed.

It takes so much strength to take charge. To stay out there. To act boldly. To hunker down.

ALL your strength.

And theirs.

Be sure to use it all.

©2009 – Jan Bolick, Business Class Inc The author gives permission to distribute copies of this article as long as it is copied in full – including the box below.

Jan is President of Business Class Inc. If you don’t yet subscribe to the “Business Class” E-zine…you are missing out on a tool that is highly praised by managers and business owners across the country. You’ve got nothing to lose and much to gain. Sign up here. It’s quick, easy & FREE!

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