How to Make the Most of Your Headcount
Most businesses are bracing for uncertain economic times ahead. The slow down in China, the U.S. and the Eurozone has force Singaporean companies to relook their priorities so as to maintain profitability. A simplified approach by many businesses has been staff layoffs to save on the overheads and survive the harsh economic times. However, this may not be the most efficient way.
Retrenchment exercises and staff cuts often come with their fair share of organizational and emotional disruption. Here’s how to make the most of your headcount and avoid these pains.
1. Understand your Existing Labor Force
Before you make any critical decisions concerning your headcount, you will need to have a good understanding of your current state. Seek to answer the following questions about your team:
- Is your headcount mainly constituted of specialists? Or generalists? Or is it a combination?
- How is the experience mix? Do you have a bias on seniors or juniors?
- Do you anticipate movements by key people in the next 12 months?
- What is the gender mix?
- Where do you find most points of human failure?
- Do your staff display ambition through career paths and goal setting?
Although this exercise may seem tedious at first, it will give you invaluable information regarding your headcount. From here, you can discuss with HR specialists as well as peers on how to optimize your staff resource.
2. Promote from Within
Promoting from within not only saves you costs such as advertising and time spent orienting an external recruit. It also boosts the morale of existing staff. It is a good succession plan where staff can chart their career paths.
A clear career path for an employee will encourage confidence, taking up of initiatives to improve skills and spur leadership among your existing pool and foster a sense of loyalty.
3. Manage Underperformers
No organization lacks underperformers. In uncertain economic times, termination is seen as good quick fix solution, hitting two birds with one stone. This is not always so; immediate termination will also deprive you the opportunity to understand the root cause of underperformance. For example, it can be due to poor processes, poor skills matching or demotivation.
To identify and address the root cause, a time-limited performance improvement plan which encourages active engagement between the employee and the supervisor is necessary. Through this, you can resolve more complex organizational issues such as poor processes and motivate staff to produce better results.
4. Hire Less Expensive Contractors
With a good understanding of your staff mix, production processes, and a optimum target headcount, it is possible to engage less expensive contractors. Resources such as interns, part-timers, and freelancers can supply desired results and in some cases a significant level of experience at a much lower cost.
When implemented in a judicious manner, it can significantly reduce your labor costs as their compensation terms are lower than permanent staff. You will also need to be conversant with government regulations on this hiring to apply it to your organization.
In conclusion, to make the most of your headcount; first, understand your staff mix, believe they can deliver desired results and implement the recommendations mentioned above.
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