If You Have To Cut Back, Do It Right!
There is no use pretending these are not tough times in this industry. And most bankers are honest enough to admit to themselves that there are areas that must be made leaner and more profitable. This means, inevitably, there may be some cutbacks necessary in order to run a more efficient institution.
There is also no denying that we owe it to the people who have been loyal to our industry and our institutions for so long to do the right thing by them.
If you are considering layoffs and cost cutting measures, follow a few morale boosting, common sense rules. Don't ignore employee morale. That omission will cost you dearly.
First, explain why you have to cut costs, why this action is necessary. Employees will be much more supportive of you if they have this understanding before you take action.
Second, ask your employees for their cost cutting ideas. They may have some you never even realized could be used. There could be some full time people who would prefer part time, if they had the chance. Or others who know where the "fat" is that can tip you off to savings. The other bonus to asking is that they are now actively involved in the decision making process, and will be much more likely to accept changes.
Third, advertise the benefits of the cost cutting to the employees involved. If what you are doing now means job security to them later, let them know it.
Fourth, keep them informed about how the actions they and you are doing together are working. Evidence that these efforts are paying off is motivation in itself.
Lastly, be sure you practice what you preach. If you are asking employees to give up something, you need to join them in the cutbacks. And it should be something obvious, in order to make them and you feel like team players.
There are ways to cut costs, and there are ways to cut costs. If you have to do it-do it right!
Copyright © 1991 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 2, No. 2, 3/91
First published on 03/01/1991