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How Do We Determine The Way Forward?

Invest, consolodate, or remove

26Aug

This is the burning question that many businesses ask themselves. Where should we invest, where should we consolidate, and what should we remove? Today’s global marketplace makes these questions even more difficult to answer.

The natural place that many leaders focus on is cost reduction, in many cases to the detriment of the wider business. Is this always a bad idea? Of course not, but it’s not the only aspect that needs to be considered.

Often overlooked is the people aspect of business. Not only front line roles, but roles that provide support the wider business. Unfortunately, I have seen it time and time again, roles such as commercial analysts, workforce reporting specialists, and organizational design specialists are often the first on the chopping block. When these types of roles start to disappear, how do you make informed decisions? You may as well grab a hat, throw some paper in, pick something out and follow its advice!

When businesses start to eliminate these roles, they remove the ‘GPS’ function of the business. Suddenly, they are flying blind with no insightful data to base decisions. This can lead to disastrous results. Instead of removing these types of roles, more resources should be diverted to understanding what the underlying drivers of the business are, not only from a direct financial impact but also a people impact.

You can study many papers on what makes a good, efficient business, and decide on a specific methodology such as LEAN, maybe adopt the PDCA cycle (thanks, Dr Deming), but what about the focus on people.

For example, how often have you visited a supermarket and had to search for someone to assist you. I find that even paying for your groceries has become a chore. I have a good friend that manages a large retail store, and when discussing how he manages to turn a great profit, well above forecast, while others in his region are struggling, he has a simple answer – 'do not cut labour from customer service areas…….if you can’t deliver what your customer wants, they will go elsewhere.'

So you would probably be thinking, how do roles such as workforce analytics and organizational design support the above observation? Why not just throw more labor into customer service? Well, if you do not understand what drives your people, you have no chance in delivering on customer expectations. More does not always equal better.

You need to understand your workforce, in order to provide support in the correct areas to drive that customer service experience. Without the support functions in the HR area, you have no chance in understanding what drives staff turnover, or conversely retention, or even what makes an employee loyal to your business. What drives that exceptional employee to go the extra mile?

Food for thought!

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