As an employee retention speaker and employee retention trainer, I recommend that when times slow a bit that organizations hold onto their people. In the labor market like we have, the ability to cycle people in and out is getting harder and harder. You can cut people loose in the slow times but unless you have an incredibly accurate crystal ball, the likelihood that you are going to be able to ramp up to take advantage of when conditions improve is incredibly difficult. Unfortunately, that’s how most organizations face their business. They lay people off…then hire them back…usually too slowly. Or, those people have already taken other jobs and aren’t about to come back to the place that laid them off.
This employee retention author’s approach is to run your organization lean, run with high performers and pay those high performers well. What this ensures is that you can absorb the down cycles while still preserving profits and be ready to ramp up when things improve. The other component that must take place is that if you have a low performer, you address that person during the normal course of business. You can’t afford to carry a low performer in a lean, high performance environment. The message you send by cutting a low performer when things slow down is that people are an unimportant commodity. It doesn’t matter if they are an underperformer, what other people see is that with a slowdown, the organization cuts people. People equate that to the fact that when things slow down, people see that you are not loyal to them. That’s why it’s imperative that when issues exist, you step up and address them with the problematic person. It’s about perception.
Handling performance issues proactively isn’t fun. It usually means that there will be conflict. It means you have to do performance development plans and work to turn a non-performer around. It IS hard work. Aside from the gratification that can take place when this happens, it sends a powerful message to everyone in your workforce. That message; people are not a commodity. This is the type of message that needs to be sent if you want to build loyalty that will last over the long haul.