I’d like to see a show of hands for how many business owners instituted a really awesome cost-savings plan but it never went anywhere because employees refused to help make it happen. OK, a lot of you.
In this economy, when you move to cut costs, you really need it to happen, not for employees to be laughing and texting each other about how unwilling they are to turn off the lights or find cheaper vendors.
To find out how to get employees to buy in to cost-saving programs, I turned to a company with a fat century of experience at this: Maritz of St. Louis. It started with a gift-reward program and branched into consulting on employee motivation. It still offers rewards programs to employees, too, including one tailored just for small businesses.
Recently, spokeswoman Paula Godar shared the Maritz philosophy with me on getting employees to buy into your cost reduction plan. The chief issue to resolve for workers: “What’s in it for me?”
While you might wish that workers would help you save money because they care so much about the company’s success and because ultimately it helps the company survive and keep them employed, most people don’t work that way. They need more, a clear understanding of what they’ll be expected to do, coupled with close follow-up and the carrot of a personal payoff, Godar says.
Start by clearly communicating why the cost cutting is needed. Provide details: “We need to save $100,000 in costs or we will need to have a few layoffs. We’re trying to save jobs.” If possible, set up teams and have employees brainstorm ideas for meeting your goal. They’re more likely to do things they suggest.
Once you’ve firmed up the plan, explain exactly what workers need to do to meet their personal or department goal. Then keep the communication going. One of the biggest problems with most company cost-reduction initiatives, Godar says, is that interest wanes rapidly after they’re introduced. So show workers you plan to stay on it with regular monthly progress meetings where you announce results to date.
Create a rewards program to recognize workers who excel in finding savings. Ideally, have a system online where workers can check to see who has earned the most points or other rewards.
Finally, follow up with research after the program concludes. Learn what workers thought of the program and whether they have more cost-saving ideas. You may be able to kick off another round of savings if you’re listening to workers’ feedback.