A while ago I hired a financial consultant to help me work out how to grow the business. He was used to stock movement and retail businesses, so he did the usual “efficiency” calculations and promptly advised me to cut “a few less needed staff” like it was a miracle cure concept … I did not take his advice and let him go instead.
At the time I couldn’t explain exactly why I shouldn’t cut back on staff exactly, apart from the fact that the business couldn’t do the work without them.
Finally, after thorough reflection, I can explain why I made that call.
If your financial adviser was your fitness trainer, he would be telling you to cut your leg off, because there will be a 20% reduction in weight straight away. Oh, you need your legs? Ok then. How about we pick something else that doesn’t serve as vital or as visible a role … some internal organs, perhaps?
Lets look at what would happen to you if you followed this advice:
Short term – You jump onto the scales, the all important overriding thing you use to judge your success, and look … success!!! right?
Mid term – Without help you would begin to starve, because you can’t do all the things you are used to, so you have to pay others to assist and you are reliant on them. This, if not managed very well, becomes a greater drain than the weight you were carrying in the first place.
Over the long term, you’re going to gain more weight, because you can’t get the exercise and can’t operate the way you used to.
So why did I avoid the advice? Cutting staff is a very short term and often quite dangerous decision to make, especially if they provide a small, but key role in your engine of growth.
So what is the alternative?
Get fit! Its harder, but its worth it.
For the business and every department within it, this means defining and reviewing it in terms of the processes that make up its operation.
Starting with “Where is the money coming from?”, “How does that income match to the value (products and services) we offer?” then, “How does it support the delivery of our value?”
You are then in a position ask the detailed questions like
- How can you reduce the fat (time, effort, costs) on each aspect of delivery?
- Can we measure the processes to gauge how much fat they have?
- Can we break the processes up into smaller parts?
- How do we hand over between one process and the next?
- Can roles that cost less do more of these smaller parts?
- Can we reduce the total number of processes?
- Can we automate the new set of processes?
Now you are in a position to rearrange staff into the roles that support the business to best effect, and hopefully, have staff doing the job they want.
You are not only on your way to becoming leaner, BUT you still have your legs!