Across the board expense reductions, such as travel or layoffs or meetings or training/development costs, are required of executives at an ever-increasing velocity. These ongoing ripples of cuts leave many feeling handcuffed, frustrated, overworked, and drowning in their workload.
Compliantly moving to the sidelines, if from your prospective a decision is detrimental to the operations, is neither good for your soul nor your career.
What Is Your Responsibility? Withdrawing without a murmur of protest sets you up for being complicit at some level. You’re employed to be a leader no matter what position you hold. Senior Management can’t possibly be as familiar with your area or the consequences as well as you. That means you have the expertise and knowledge to push back respectfully. Timing is everything. Be a “Yes, for the business need to reduce costs. You know the “I’m onboard attitude.” Pause, line-up your arguments, and then, present your case for opposing the initiative.
How Do You Respond? The manner in which you challenge authority will have a lot to do with your success or failure. Come with an attitude of calmness, confidence, conviction and make sure it’s fact-based. The hoped-for outcome is not to make anyone wrong rather opening the tough-process of creating results in alignment for the greater good of the organization.
Relevant research to beef-up your cause:
Travel: According to research by Oxford Economics: Curbing business travel can reduce a company’s profits for years. The average business in the U.S. would forfeit 17% of its profits in the first year of eliminating business travel. It would take more than three years for profits to recover.
Layoffs: Bain & Company found companies with few or no layoffs performed significantly better than those with large numbers of layoffs. Businesses that laid off 3% or less of their workforces did just as well as companies with no layoffs at all: Both groups posted 9% share price increases, on average. By contrast, share prices remained flat in companies that let go 3% to 10% of their employees, and prices plunged 38% for those that fired more than 10% of their workforce.
Meetings: Forbes Insights study revealed an overwhelming majority of executives expressed a preference for face-to-face meetings, with more than eight out of ten saying they prefer in-person contact to virtual. The reasons executive’s cited, building stronger, more meaningful business relationships (85%), ability to read body language and facial expressions (77%), and more social interaction and ability to bond with co-workers and clients (75%).
Training/Development. According to the American Society for Training and Development, investment in employee training enhances a company’s financial performance. An increase of $680 in a company’s training expenditures per employee generates, on average, a 6 percent improvement in total shareholder return. Firms investing the most in training and development (measured by total investment per employee and percentage of total gross payroll) yielded a 36.9 percent total shareholder return as compared with a 25.5 percent weighted return for the S&P 500 index for the same period.
Be the leader you know you are and press back when in your mind it’s appropriate. And then, if it doesn’t go your way, take the budget hit gracefully to be the outstanding team player and leader you are.
