Respect is key to boosting morale
Dear Karen: How do I keep morale up at my company when everyone’s worried we’re going under?
Answer: The key is treating your employees and partners with respect, said Douglas Duncan, chief executive of Your HR Solutions, a human resources consulting firm in Maplewood, N.J.
“Don’t insult people by pretending things are OK when they may not be, and don’t ignore them by keeping silent and hoping it all goes away,” Duncan said. “If there are problems, include your employees as part of the solutions.”
Set goals based on the new economic reality and share them with your staff. Talk to your employees every day, even if it’s just to say hello and thank them for working hard. “Recognition from leaders will make all the difference in your company morale,” Duncan said.
Staying profitable during a recession
Dear Karen: What costs can I cut to stay in business?
Answer: Business owners who try to stay profitable by reducing minimal expenses for the short term are rarely successful. “Turning up the thermostat or shipping by freight rather than overnight will not offset a recession,” said Bill Bartmann, chief executive of BillionaireU .com.
Other companies in your industry are suffering the same loss of revenue and increase in operating expenses that you’re probably experiencing. All you need to stay viable is to gain an edge: “You don’t have to outrun the economy, you just have to outrun your competition,” Bartmann said.
Rather than cutting small costs, think about increasing your prices. If your business has been profitable until recently, increasing your prices in proportion to increased expenses should allow you to continue to produce a profit.
Another idea is to attract new customers who are changing their purchasing habits because of the economic downturn. “Don’t cut your marketing budget, but focus it in areas where your message will find desired new customers,” Bartmann said.
Ways to prevent employee theft
Dear Karen: I had to fire one person last year after a theft at my company. How can I prevent it from happening again?
Answer: Employee theft is particularly devastating for small companies without large capital reserves. You can’t completely eliminate the possibility that another employee will steal from you, but there are several ways to prevent theft or detect it early -- before it destroys your business.
Dana Basney, director of forensic accounting services at accounting firm Mayer Hoffman McCann in San Diego, said all small-business owners should physically secure their offices or warehouses and install security devices. You should carry adequate employee-theft insurance, he said.
In addition, perform periodic inventories, with high-value items inventoried more frequently. Investigate discrepancies so employees recognize that you are being diligent about protecting the firm’s assets. And make sure you have computer security in place so access to your business systems and internal financial data is limited by job function.
You can find additional suggestions from the Assn. of Certified Fraud Examiners at www.acfe.com/resources.
