FOR MANY SMALL-BUSINESS owners, the recession created unprecedented pressure to cut costs, trim their staffs or enact hiring freezes. Slow sales and a tight lending environment left human capital at a high premium.
With few options but to get creative or close up shop, many small-business owners devised new ways to squeeze more productivity from their existing workers.
At Skip’s Florist & Gifts, owner Sanford Skolnik saved his company roughly $65,000 a year by making it more efficient. When the economy began to turn, Skolnik examined his Toms River, N.J., flower shop’s expenses and looked for ways reduce costs. He renegotiated contracts with vendors, stopped ordering items that weren’t selling and let go three of his workers.
Skolnik not only retrained and cross-trained his remaining employees to do each other’s jobs, he also managed to hire two new workers (at lower rates than their predecessors). He studied his company’s delivery routes and eliminated the need for one vehicle and he introduced more efficient technology. “These measures and other ones have saved me enough money to increase my advertising, bring in products that have more profitable margins, reduce overhead and increase benefits,” Skolnik says.
Many owners have already instituted a number of cost and time savings measures. However, if sales pick up as the U.S. economy expands and you’re still not ready to hire new workers, make sure your current staff is prepared to take on added demand.
Here are seven ways to boost employee productivity:
Relieve layoff pressure
Remaining employees who’ve witnessed a round of layoffs – and even those who haven’t – are under a lot more stress these days. “On one hand, they are concerned that they could get cut, and, on the other, they have more work,” says Christine Probett, a human resources professor at San Diego State University. Now is not the time to cancel meetings. In fact, she says, employers might want to meet more often.
And if possible, managers should assure employees that layoffs aren’t in the cards. “When [workers] are nervous about their jobs, they are not working as hard; they spend more time speculating about their jobs,” Probett says. “Mitigating their fears eliminates a lot of lost time.”
Even when companies are demanding more from their workers, they should be more supportive of them, as well, says Jay Weiss, a consultant at JGI, a management consultancy in Rochelle Park, N.J. That could mean doing away with a few less useful tasks or just allowing employees to prioritize their own work. For instance, if certain duties don’t deliver much value but still need to get done, employers should consider letting workers do them less frequently, he says.
Then, employers can create productivity standards that employees should strive to meet. Managers should talk to employees and gauge their workloads, says Paul J. Rauseo, the managing director of George S. May, a small-business management consulting firm in Chicago. If a firm employs bricklayers, for example, it should measure the number of bricks its best worker is able to cement in an hour. If there are impediments for performing better, the firm should try to eliminate them, he says.