Weathering the Economic Downturn
09 January 2009
There has been a considerable amount of press lately concerning the economic downturn, the credit crunch, the recession, redundancies and Company closures. Already we have seen well known organisations large and small either attempting to weather the recession through downsizing and reducing operating costs before the storm hits, or being forced into administration.
The typical problem for this is cash flow problems, with clients reducing their demand for supplies and services, creating a downturn in business, which results in a vicious circle where other companies ultimately are forced to reduce their expenditure and operating costs, and so the circle continues.
Ultimately some organisations are going to struggle during this difficult period but there are other options available to try to avoid making redundancies or Company closures with reduced hours; lay offs; and through consultation with employees companies may be able to offer periods of unpaid leave, or other alternatives.
At HR Solutions we don’t believe that reducing employee numbers is the first thing that a company should do and encourages employers to think about the essential priorities for their business and to focus on the things that will have the most robust financial impact before making any knee jerk reactions to cut staff overheads. Making a wrong decision could seriously affect your business in the long term, particularly with regards to ensuring you retain the skills required for the future when business picks up.
Any knee jerk reaction may actually end up costing your Company more if the process is not managed effectively and in line with the relevant statutory procedures.
If you wish to discuss the options available to you, or advice and guidance on how to manage redundancies then please contact Greg Guilford at HR Solutions (Consultancy) Limited on 01536 484 552 or enquiries@hrsolutions-uk.com.