Hard times give reasons to keep workers happy

Companies face a new challenge.

Chicago Tribune

CHICAGO — It’s quitting time on the kind of beautiful day that tempts office workers to skip out early, but not a cubicle is empty.

Pizza is served on paper plates, but work rather than food is the attraction. Periodically someone jumps up to ring a big copper bell. All eyes turn to a whiteboard where the bell-ringer scribbles the latest win: a job lead, a referral, an interview. Then it’s back to the phones.

This weekly ritual began in February at recruiting firm Instant Technology LLC’s downtown office after January sales dipped 30 percent because of sluggish hiring. Managers organized the Tuesday Night Supper Club — part contest, part morale-booster and drum-up-more-business effort.

“We’re all in it together,” said Vice President Elizabeth DeFazio.

A sputtering economy is testing employers’ ability to enlist workers’ goodwill at a time when it’s needed more than ever. At plants that no longer hum with overtime, managers search for ways to keep their best employees from leaving despite offering them fewer hours. At stores where traffic is down, supervisors mete out fewer shifts to salespeople while asking them to redouble their efforts to please customers. In offices, leaner staffing means extra work for those who remain.

If the downturn is deep and prolonged, challenges will intensify because employers can’t afford to lose people who will be hard to replace when the economy rebounds and Baby Boomers retire in even greater numbers.

“In the past I think it was much easier to come to the conclusion that staff is first to go and we can always hire them back,” said the American Management Association’s Manny Avramidis, senior vice president of global human resources. “It’s going to be extremely hard to find qualified people if organizations cut back the human resources they’ve developed.”

Even small layoffs increase voluntary turnover, studies show, and reducing hours or freezing salaries forces all but the most financially comfortable employees to look for better opportunities. Yet people will stick through hard times if they feel they were treated fairly by an organization that offers a promising long-term future.

The Container Store, a perennial on Fortune’s best-employer list, retained several dozen middle managers during belt-tightening in late 2000 — even after their jobs were eliminated — by demoting them temporarily and laying off lower-level employees instead.

“One was a visual sales trainer who traveled and taught how stores should look,” said John Thrailkill, vice president of stores. “She was asked to return to a store as a full-time salesperson. Most people would say that’s a huge demotion. We kept her salary intact. As good as she was, we knew she would be able to deliver a huge amount of productivity in a sales role.”

Today she’s a vice president, Thrailkill said, and several others are director-level executives.

Communication is key, he added. “We don’t disclose individual salaries, but everything else, including all our business planning, even though we’re a private company, we make open to employees, even [those who work] part-time.”

An example was the meetings scheduled with employees in early January to talk about staffing for the seasonal slowdown that began in February, when an annual sale ends. Jobs and hours are cut, and decisions are based on performance rather than tenure or pay rate.

“Managers can chicken out and say, ‘I’m being forced to do this,’” Thrailkill said. “That’s how you lose people at a time like this. You need to treat people honestly and fairly; it’s the most important thing you can do for them.”