Wednesday, August 26, 2009

Running scared

It is relatively easy to be successful and somewhat innovative when the economy is booming and life is good so to speak. As the world entered in its deepest recession in decades what made companies successful just lost is relevance, it just became the recipe for disaster. All of sudden these buoyant and confident, and sometimes over confident and damn outright cocky executives, are no longer sure of how to react. They know they have to be more cost effective and more efficient. The product has to be tailored to meet new customer realities.

So, enter first gut reaction, we need to save on expenses, OK so far so good. So please make sure you vet your office related bills and pay for all your personal calls or else we will charge you for the whole bill, and please reduce the use of stationary, and we just go from cost effective to cheap on all non technical purchases. Basically, we went petty.

Then, next gut reaction, no more hiring, full stop end of story, but we need this person for a function that will increase productivity or efficiency. Sorry, no hiring, gotta save buddy.

All of a sudden, they wonder why staff is demoralised, easy it is the prevailing economic malaise, nah more like the prevailing scared and petty once over confident executives. Staff can smell fear guys.

Economic downturns are awful and not a pretty sight but remember cost cutting is subject to the law of diminishing returns and revenue enhancement the sky is the limit. You need cost cutting, efficiency and productivity increase then ask the experts.... duh....... yep you got it champ, ask your employees. Oh you forgot they were part of success and you thought they were coming on your ride. Involve your staff, they know their work, they know what, where and how to give you real savings, real productivity and efficiency.

They also have a stake in making the company thrive, harness their energy. Treat them right and the will Billy Ocean sings "When the Going Gets Tough, the Tough Get Going"


  1. Oussama, I think I know to where you are referring !!

    You could also include companies that capitalise on senior management turnover to cut costs, leaving positions unfilled and pushing responsibility onto the remaining junior executives too soon.

    The effect is a corporate brain drain and a recipe for failure in an ever more complex, more competitive world ...

  2. I work for a company that went on a massive company-wide cost cutting drive. Thanks to that, our stock actually went up, we never had to carry out any 'mass layoffs' (though ALL our competition did), and maintained a very high cash reserves in the books.. However, 2 lessons can be learned from my experience with the organisation i work for.

    1. The business of 'cost cutting' needs creativity, a lot of it. Knee-jerk type reaction and let-cut-down-on-the-first-thing-you-think-is expensive, cause disruption and will have demoralizing reprecussions on people and staff.

    2. Communication is key. Not only it will disseminate ownership and responsibility of the status quo, it will invoke collaborative leadership among your field leaders, or AKA middle management.... and could also act as a good safety valve for those who are pretty pissed off, to simply let it out .. :)

  3. I am not against cost cutting, I am against petty, ineffective and disruptive cost cutting. When you empower your staff, you tap a large reservoir of creativity and create ownership and goodwill. However, I still believe cost cutting on its own is never sufficient, revenue enhancement has to be the major factor.



1 Goal 2010 2012 2013 9/11 AA Abu Dhabi ADAC Air Arabia Air Canada Air India Airberlin aircraft airlines airports ambitions American Airlines Amman aviation AVOD AWST B707-300C B767 B777 B787 BA Bahrain Bahrain Air BangaloreAviation Boeing branding British Airways Business Aviation Cabin Crew Canada change chapter 11 CO Commercials communication community compliance contingency continuity Continuous Improvement cost effective creativity Culture curricula Customer Service Delta Detroit Metro DFW Doha DTW Dubai Dubai Air Show DWC efficiency emergency Emergency Response Emirates employees environment ET409 Etihad ETS EU FA FAA family Flight Attendants flight(s) Flightglobal flydubai GACA Galaxy Tablet GAMCO GCC globalisation GOL Greece Green Gulf Air Hala Hamburg happy health home Hopenhagen Human Resources IFE India Iran Iraq Iraqi Airways Jaffa Jazeera Airways Jet Airways Jordan Just Culture Kuwait Airways LA LCC leadership low cost maintenance management manpower MEA MEBAA MENA Michigan motivation MRO MROAM Oneworld Palestine passengers passion people Philadelphia planet earth Privatization professional QAIA Qantas Qatar Qatar Airways Quality Quick Service Restaurant Radio Repair Stations Risk road roots ROTANAJET Royal Jordanian Safety Sanctions. Sao Jose Dos campos SAT Saudi Arabia Saudi Arabian Airlines Security Sharjah Airport SimliFlying Simplicity SKYTEAM SMS social media Southern California Southwest Airlines Star Alliance Sudan Airways support target teachers Technology terrorism tolerance Toulouse tourism traffic Training transition travel TSA Turkey Twitter UA UAE UBM US Airways VIA Rail Violin Vision volcanic ash Wataniya Airways
Top Blogs
Powered By Invesp