According to the human capital consulting firm Watson Wyatt, employers need to make sure employees are engaged and committed to their job despite the tough economic climate. Here are its 10 top tips for surviving the downward pressure on costs and falling profits - and for coming out the other side with success.
1. Focus on key talent
Focus limited resources on keeping and rewarding your key talent. These are the people you need most now to get you through the difficult times and later when the economy recovers.
2. Be careful what and who you cut
Don't make harmful short-term cuts. Conduct strategic workforce planning to understand your current and future talent requirements, and ensure your business has the necessary resources and skills for the upturn.
3. Ensure performance management is understood
Ensure your performance management process is effectively understood by your employees and delivered well by line management. It should not be seen as simply a process for identifying and culling underperformers, but instead as a way to raise performance throughout the organisation.
4. Don't abandon bonuses
Don't abandon performance pay and bonuses but instead target them on your top performers and refocus them on realistic but stretching targets that will promote the right behaviours in this new environment.
5. Review sales targets
Review sales targets and territory strategies to focus your sales force on the largest opportunities.
6. Look for cost savings
A review of business processes, HR policies and tax and administration could reveal untapped efficiencies. Examples include shorter working weeks, changes to travel policies, and salary sacrifice for pensions contributions, where savings can come through within a few months of implementation.
7. Promote the total reward message
Keep communicating the value of your total rewards. A tendency to focus on base salary means that employees generally underestimate the full value of their total reward package. Ensure employees know just how valuable their total reward package is to them.
8 Review executive reward
Review executive compensation to ensure the package is aligned to shareholder requirements, but still retains key executives.
9. Don't damage your employer brand
Don't harm your employer brand by not delivering on your employee value proposition the moment things get tough. Live it through tough times and you will maintain an engaged and productive workforce.
10. Keep talking
Be as open as you can with employees about your current HR and reward strategies. Silence breeds fear and reduces employees' engagement with the organisation. Employees know you don't have all the answers and cannot offer guarantees about the future.
