Managing Staff Through Tough Times

September 13, 2009

Small business owners face tough issues in a troubled economy. One of the most difficult challenges can be managing a staff through uncertain times. Whether it’s a matter of keeping anxious employees focused on their work or making hard decisions about layoffs, company owners often find themselves wondering what the best steps may be. The Virginia Society of CPAs offers some timely suggestions.

Be realistic

If the business is experiencing financial troubles, the news will probably have already spread through the company grapevine, so don’t pretend everything is rosy. Instead, be honest, but also upbeat and realistic in your dealings with employees. You might acknowledge that the company has lost a big client, for example, but point out the other steps you are taking to adapt to changing times and find new opportunities. This will reassure employees that the company leadership is dealing with the problems you face and make it easier for them to concentrate on their jobs rather than worry about the business’s survival.

Focus on opportunities

Your employees are well aware of all the problems that come with a downturn. That’s why it’s a good idea to remind them that a recession also provides potential opportunities. Salespeople might be able to pick up new clients when competitors cut back operations or shut down, for example. Employees who manage vendor relationships may find it easier to cut better deals on contracts as well. Consider brainstorming with your staff to identify all the opportunities open to your company and develop ideas on how to make the most of them.

Find the upside

If overtime and long hours are a normal part of doing business at your company, then a slow economy can provide some needed downtime for hard-working staff members. Instead of allowing employees to become anxious about the downturn, encourage top people to take the vacation time that they have accumulated or to use slow periods to catch up on worthwhile projects that often get pushed to the back burner. Once again, you’re taking a consequence of the bad economy and finding a way to turn it into a benefit for the company and its employees.

Consider alternatives to layoffs

Cutting back on staff when business is slow can be a wrenching decision for company owners, especially when you know employees will have a rough time finding new jobs. Dropping down to a smaller workforce may also leave you at a disadvantage when the economy does turn around. That’s why it’s a good idea to examine all your alternate choices. Salary, hiring and benefits freezes, for example, can prevent further increases in expenses. Salary cutbacks can make it possible to hold on to the same number of people for a smaller outlay, as do furloughs, in which employees are given days off without pay during slow periods. By taking these steps you can maintain the same experienced workforce and help keep your staff off the unemployment line.

Consult your CPA

Your local CPA has extensive experience in working with small companies like your own in good times and bad. Be sure to turn to him or her to consult on any problems facing your company during these uncertain times.

The Virginia Society of Certified Public Accountants (VSCPA) is the leading professional association dedicated to enhancing the success of CPAs. Founded in 1909, the VSCPA has 8,700 members who work in public accounting, industry, government and education. The VSCPA is celebrating its Centennial anniversary this year — 100 years of an organized CPA profession and a strong organization uniting and representing CPAs across the Commonwealth. Visit www.vscpa.com/Centennial to learn more about the VSCPA’s Centennial Celebration. For general information, please visit the Press Room on the VSCPA website at /, e-mail vscpa@vscpa.com or call (804) 612-9424. To search for a CPA in your geographic region, visit http://www.financialfitness.org/ and click on “Find a CPA.”

© 2009 American Institute of Certified Public Accountants