Your small business has just taken a serious blow – a key customer cancelled a big order for the fall. How do you deliver the bad news in-house? It’s best to take an upfront, honest approach, wrote The Globe and Mail Sept. 9.
Share industry reports to support your case: “If the world is getting tougher, then provide documentation that shows how tough things are,” says Ronald Burke, professor emeritus, organizational studies, at York University’s Schulich School of Business in Toronto. “You can say, ‘Here's the industry picture, and here's our company picture. Here are the changes going on, and the threats we are facing. We need to do more, with less, if we are going to survive this together.’”
Communicate that you, as owner-manager, are in the same boat: “It's critical for the person at the top to say, ‘I'm going to make sacrifices, too,’” says Burke, who is co-editor of a textbook titled Human Resource Management in Small Business: Achieving Peak Performance.
Encourage employees to come up with cost-saving ideas: “Employees know how the business can save money and operate more efficiently,” says Burke. “I would certainly encourage them to find ways to cut costs without cutting people.” In this lacklustre economic environment, employees are keen to ensure the business's survival. “The job market is not that great,” says Burke. “People are interested in keeping their jobs, and making sacrifices is easier to pull off in a small business.”
Some cost-saving measures include short-term salary reductions, shorter work weeks and an end to merit pay. “There are a lot of ideas that a small business can tap into, without layoffs,” says Burke.
Republished courtesy of YFile– York University’s daily e-bulletin.