The Company’s most important asset

Over the last 15 years or so we have seen a shift in corporate America’s attitude on their employees. Unfortunately, the answer to the question of keeping profits up and responding to the pressures of Wall Street has been “downsize” or “right size” or as some would call it “dumb size”. What I would call it is “the death spiral”. Once the process of lay off’s begins, the mindset becomes one of “when it doubt lay off”.

The cost of lay off’s is nothing less the phenomenal. Not only the cost of the packages, severances (if any), but what it does to the employees that are still left. The folks that remain behind ask the question, when will it be my turn? When will the next round of lay off’s happen? Should I start looking for a new job? What is my future here? Now the big issue becomes productivity, moral and attitude towards the company. No longer will the employees take pride and ownership in their job or the company because the main issue is survival. I worked for Digital Equipment Corporation for nearly 16 years. The company had a reputation going into the 90’s of never having a lay off in it’s over 30 year history. What a great place to work! When the first lay off’s came in the early 90’s, the whole personality of the company changed. Who will survive? Instead of a “playing to win” attitude, the attitude became “playing not to lose”. You can’t win business with a “playing not to lose” attitude. The death spiral began and the company was bought in the mid 90’s by Compaq Computer.

Companies need to realize that their number one asset is their people. Just look at Walmart and Southwest Airlines. Employees always come first. Respecting your employees, appreciating the value they bring and providing ongoing training is critical to the long term success of the company. Instead of focusing on reducing costs as the number one issue, focus on your people and your customers. The long term results will be more promising. For further information on this topic I highly recommend Jeffrey Pfeffer’s book- ” The Human Equation “

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