An old saying goes 'that in good times anybody can make money; in bad times only the best can.' In down times, even more than boom times, employees become the critical edge. And in good times or bad, your employees determine your profitability. Are they good enough?
If your company's numbers aren't where they should be, what can you do?
The first steps include a close examination of your business model and infrastructure. After looking there, you have to look to your people. Can they do the job? What value are they bringing to the company?
Make an employee list and rate each employee's value to your company. Keep it simple. One way is the ABC rating: A for keeper employees, B for those with 'maybe' or 'twilight zone' and C for those that need to be cycled out. Failure to do this puts your equity on a spinning roulette wheel, meaning your company must rely on outside miracles --like a rapid turnaround in the national economy -- for your profit/loss statements to improve. Las Vegas, anyone?
One obvious key to finding out about your employees is to rate them on measurable productivity tasks, such as how many units they produce an hour or their monthly sales total. Also think about the intangibles: are they a team player, do they help company morale, do they get along with co-workers, are they a fit with the company culture? By using these different viewpoints, you will get a more complete picture of your employee's true contribution.
At the same time, take a good hard look at where your company will be going in one year and in five years. Look at what form of company structure and organization will be necessary to meet your future needs. What will your future customer want? What kinds of employees will be needed to service your future customers?
When you get this picture clearly in place, and after you have evaluated all of your employees, you can make an extrapolation as to which employees will bring value in the future. You may be surprised at which employees may not have a spot in your future company. That's because an employee of today may not be appropriate tomorrow. Once you have determined you have inappropriate employees, you have to recruit new ones.
This isn't rocket science. The corrective actions you take depend on your company's specific circumstances. But from a global standpoint, you can either maintain the status quo including poor results, or change. The real problem is the amount of hard work required to make positive change happen. The temptation to go back to the 'bad numbers' comfort zone is so strong, only the most driven owners will be willing to pay the price required to get the numbers to work.
One of the most important questions your company must ask is: are your employees good enough?
Next time we will look at what you can do about it.