AMS - Helping People Work Together

Winter 1999

Happenings - What's New with AMS

Management - Human Behavior: Getting People Working Better Together to Achieve Better Results

Employee Satisfaction - "Why Does There Seem To Be More Mean, Rude Behavior In The Workplace?"

Helpful Tips - How To Save Time...Make Meetings More Productive

Recession-Proofing Your Organization
Is your organization ready for 1999? Many business leaders are concerned about next year's economic outlook, projecting a fall-off in orders, sales and income. Unfortunately, executives are reacting to this threat with the same old cost-cutting tactics.

Examples in the news:

Levi-Strauss announced plant closings and elimination of another 1500 jobs
Pratt & Whitney is trimming 2000 jobs
ABC News put a temporary freeze on salary increases and promotions

The sad part is these actions impact productive employees rather than eliminating nonproductive costs. The question you may be asking is "What's a better way to cut expenses and recession-proof my organization?" I just came from a Strategy Session with a global manufacturer. Their vision for next year includes a multi-faceted campaign to boost 1999 profits while building strength for the year 2000. The focus includes four areas:

Attack "Cost of Waste" : they plan to increase the pressure on failure costs, internal scrap, rework and vendor deficiencies.
Trim working capital to improve cash flow: targets include excess inventory, safety stock and overdue accounts receivable (which also drive borrowing/interest expenses).
Stimulate additional/incremental sales: with larger capital equipment contracts tapering off, the emphasis on increasing sales of smaller orders, equipment upgrades, spare parts and service.
Avoid expenses wherever possible: areas under examination include office supplies, subcontracts, travel and communications.

And yes, there will be some attrition, early retirements and downsizing in certain areas. The important point, however, is that these actions will do more than just cut costs. They will make the organization more competitive by:

Using the economic downturn to boost employee cost consciousness and sense of urgency (See "Human Behavior, point #2, next column). The goal is to get a larger number of "$40,000 people" working harder to solve $100,000 problems.
Strengthening critical customer relationships. Additional sales calls, site visits and personal contacts will be made to clarify customer needs and offer cost-effective ways to meet their requirements.
Adding value for customers. With big capital equipment financing tougher to find, the company will promote maintenance, modification and upgrade projects that give customers high returns on smaller investments in shorter elapsed times.
Reducing prices. As cost/expense reductions take place, savings will be passed on to customers. We all like quality products & services, providers who show they care and a lower price.
Getting the senior management team working better together by focusing on these immediate challenges. Top level teamwork occurs when leaders have common goals, a shared fate and a strong personal interest in taking collective action. The prospect of higher profit-sharing bonuses will help.

None of this will happen without plans, goals, trained management & employees and meaningful incentives. We help organizations create these building blocks if they don't exist, or show how to strengthen them if already in place.

Which of these can help your organization get better results in 1999?

NEXT: Human Behavior: Getting People Working Better Together to Achieve Better Results