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Keeping the doors open in your business just got a whole lot more difficult in the current economic market. The signs are, quite literally, everywhere. Open the paper and you are bound to find a new announcement of staff layoffs. Some employees stick around during hard times and others choose to jump ship because of a fear of the unknown. Just think of the impact on your business if you were to lose a staff member and struggled to find a quality replacement. Or, if you were forced to lay off a staff member today due to a business slow down. 

 

These are the kind of things that keep most business owners awake at night. But it’s not just you- the gloomy economic outlook and lack of business confidence has a profound impact on your staff. The old adage used to be that a business can’t survive without sales. While this is true, I’d argue that most businesses cannot survive without employees. So, how do you find the right balance?

 

Media outlets have been running hot with stories on the crashing stock market, employee redundancies and a general tightening of the economic belt. What does this mean for you as a business owner and the staff that work with you? You must focus not only on consumer confidence, but work hard at building and maintaining employee confidence.

 

How do you get started? The first step is to create positive communication with your employees in an open and honest manner. Let them know how the business is performing but be ready to address their fears for their own future by showing them evidence that you have a plan for your business and employees.

 

This may sound scientific, but in times of uncertainty employees want and deserve to know the facts. Regardless of the number of employees in a business, the grape vine is a strong force and employees will make their own judgements on the health of the business if you are not providing them with evidence of how you are taking control of the situation.

 

A recent example that one business owner shared with me is employees getting spooked because he did not attend the Melbourne Cup this year. He thought it was the right thing to do given the recent downturn, but instead of explaining this to his employees he just showed up for work as usual. The grape vine went into meltdown because staff thought the situation must be really dire if he cut his trip and kept it quiet.

 

So give your employees evidence that you are in control and that you have a plan for the future. If you are having to make cutbacks in spending or staffing levels, communicate to them your reasoning and your plans for the future. One way of doing this is to have a documented HR Plan which details how you are managing your employees now and for the future.

 

The harsh reality is some businesses may not survive. But this needs to be taken into context- poorly managed businesses struggle to survive even in boom times. Now is the time for you to take control of your business and demonstrate clear leadership to your staff and your customers. 

 

I like the approach that Woolworths Chief Michael Luscombe recently shared at the QUT Business Leaders’ Forum. He said that Woolworths’ view is “don’t believe in a recession and try your darndest to keep going. Now is the time to be positive. We’ve made a decision to stick to our guns and follow through with our strategy.”

 

Now you might think that Woolies is a big business and they can weather the storm much easier than a small operator. But if you look beyond the size and focus on how they manage their business you will see that this statement is key driver for their business. Now is not the time to stick you head in the sand and hope the bad times pass. Keep leading and managing your staff, keep building your business and providing quality service to your clients and you will be rewarded for your efforts.

 

Louise Broekman is the Founder and Managing Director of the Australian HR Coach Network. Louise also leads the HR Coach Research Institute which focuses on researching issues that affect the SME sector. Contact: 1300 550 674, www.hrcoach.com.au; business@hrcoach.com.au