Engaging Budget Cuts

I am not sure if you noticed but budgets are getting cut. Next Step Magazine gets most of our revenue from colleges, student loan companies and the military advertising. We have already seen the student loan companies disappear due to the liquidity crisis. As the recession deepens, we need to be prepared to feel the pain from other advertiser cuts as well.

So far, we’re hanging in there quite well. But often, it only takes a bad few months to reverse a small business’s success. So what is a maverick small business guy to do? (Ok, sorry, I just wanted to say maverick. Sometimes I feel so mavericky! Go to:
http://www.nbc.com/Saturday_Night_Live/video/clips/vp-debate-open-palin-biden/727421/ for more on being mavericky).

Anyway, what is the first thing a small business can do when facing a looming economic crisis. Obviously, cut the budget. The last thing you want to do it cut payroll and derail the moral of your coworkers. The first thing you want to do is to engage them in the process.

That’s what we did yesterday. We held a non-mandatory budget cut meeting. Since Next Step has an open book management philosophy, everyone knows every line item in the budget anyway. So about half the staff showed up to the meeting and offered their thoughts on what we can cut.

They shared great ideas and seemed to feel excited to be part of the process. They thought of things that I hadn’t. Their ideas ranged from postponing new computer purchases to having the staff volunteer to bake birthday cakes instead of the company buying them.

My role was to shut up and listen. Of course, that was not entirely possible but I think I did quite well!

Bottom line, I bet their suggestions will save us around $50,000 a year. That’s helps a lot! And it also helped that the staff was involved. Nobody likes heavy, top down decisions without being able to give feedback. Granted you can’t always implement every piece of feedback received, but the environment you will create by sincerely allowing feedback will be a cornerstone to a thriving workplace culture.