 KrKHeavy Artillery For The Little GuyPremium
join:2000-01-17
Tulsa, OK
 ·AT&T DSL Service
2 edits | reply to PrntRhd
Re: Circuit City losing money 3Q So many companies make the exact same mistake. Mine included.
To make more profit, they cut costs (Ie cut labor) at the base level.
Guess what. For awhile, it works.... you have less expense, and coast on your history. Profits go up.
However.... what you are cutting really is customer service. Support standards, customer service standards, all suffer. Long term, you just are cutting your own throat.
Management seems to forget that 100 PERCENT of all the profit comes from where the rubber meets the road. IE from where their employees directly interact with the customer. EVERYTHING ELSE IS OVERHEAD. (That includes their management pay and bonuses.)
So, when you eliminate employees and transfer that workload to remaining employees, you are basically FORCING your employees to divide their work efforts among a lot more customers... basically, attention to the customer, and good service takes a dive. Plus, you overwork your employees, and stress them out, and lower morale. Think that motivates them to try harder to please the customer? NO.
What happens is the mentality shifts from "Let's take the time to please this customer" to "Man I really don't have time to deal with this crap, I have too much work to do!" ... IE your employees would rather get rid of your customers so they can complete their tasklists, stupid checksheets, DAW assignments, and other "performance" workload requirements without getting in trouble! (IE unable to finish, overtime, missed deadline etc.) It's NOT the employees who are at fault. It's BAD MANAGEMENT.
Cut employees, pay, benefits, and cut customer service. It's not complicated. Short term gain, long term pain.
And as the downhill slide begins, what do they do? Blame the employees of course and start "Cracking down" by toughening up standards, linking pay to "performance" (IE punishing employees for problems by cutting pay and bonuses due to worsening customer service/complaints etc) and taking a hard line on overtime, tardiness, absenteeism, etc etc
Chronic short-staffing is a recipe for failure. It may take years, but it's a slow death. Problem is management never sees it as short-staffing. They call it "efficiency" or some buzzword labels like "Ideal labor capitalization" or "Labor performance to expense ratio".
/sigh |
