Cost-cutting bosses make workers’ lives hell

Tight
bosses are making employees’ lives hell as they make irrational savings to try
and survive the tough economic climate.

Research
commissioned by One.Tel and Centrica Business Services shows that 70 per cent
of small business bosses make irrational savings before considering a simple
supplier review to save money.

Six
per cent look to sub-letting car parking space, 10 per cent reduced company
supplies of tea and coffee, and 20 per cent have let the cleaners go.

Six
per cent have cut back on heating and air conditioning, 24 per cent stopped
staff use of taxis, and 20 per cent reduced office space.

Small
business employees are working longer, harder hours than ever before, without
the extra rewards; a quarter of small businesses are not letting them make
personal calls at work, 23 per cent are extending staff working hours with no
pay increase, and 9 per cent are shortening the amount of time allowed for
lunch.

Psychotherapist
Christine Webber said: "Cut-backs – particularly those that don’t seem to
make much sense – are very demoralising. They tend to make people feel
unimportant and demeaned. No one likes feeling that way, and the response is
usually to become excessively difficult, or to leave.

"Employees
also hate to be kept in the dark. So, if extra working hours with no extra pay
is genuinely the only way forward for the firm, this should be explained
properly, not just imposed. And some perks should be established to make the
change more palatable."

Carolyn
Munton, director of marketing and communications at The Chartered Institute of
Purchasing and Supply (CIPS), said: "There are several ways in which any
business can contribute to profits: increase sales, increase prices to
customers and reduce costs. The latter can be achieved through a combination of
reducing expenditure and cost avoidance.

"To
reduce costs to their optimum levels, small firms must understand their supply
marketplace, and once they do, they can put a variety of options in place, such
as supplier reduction, rationalisation or switching. All these solutions will
achieve some form of cost reduction or cost avoidance, leading to greater
profitability."

The
research surveyed 379 proprietors and directors of small businesses.

By Quentin Reade

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