Keeping morale up when the skies are cloudy

Oct 20, 2008

Things aren’t looking real great out there for a lot of firms in this business. The stock market is in a free-fall, we’re in the midst of pre-election paralysis, banks are failing, housing is in a crisis (soon to be joined by the auto industry), and there’s a credit crunch. Every day you turn on the news, it seems like it’s all bad. Not that we haven’t seen it before— we have. I remember the days of 18% interest rates in the early ‘80s when the private sector was dead! We have had it so good for so long that any slowdown is hard for some people— those who came into our business over the last 10 years, perhaps— to take. When times get tough, morale can get bad. But you can’t just accept that as normal and brush it off. Along with bad morale, comes further declines in profitability, employee turnover, and reduced value of the business. You have to fight it! Here are some suggestions on how to keep morale up when the skies are cloudy: Do not withhold any firm financial performance information! Some firms do this when times get rough. It’s a bad idea! People will be wondering. They will assume things are worse than they are if you don’t share the information with them. Don’t make this common mistake! Fight to avoid cutting staff. Don’t expect ANY layoffs to boost morale. If you are laying people off due to lack of work (and this is contrasted with firing them for poor performance), you have failed as a company. People trade off a certain amount of opportunity for the security they’ll get from working exclusively for you. You had better respect that and accept the fact that this is an important part of the employer-employee relationship. Violate it at your peril. You and the rest of the principals should work harder yourselves— visibly. That means staying later, being there on weekends, and generally doing what it takes to not only get more done than you used to, but also to be perceived by the rest of the staff as getting a lot more done. This is hard for some people who have gotten a little spoiled over the years. Cut ALL of your luxury perks and be sure to not make any visible purchases that may appear unnecessary to the rank and file. I’ll never forget the architects years ago who announced “no bonuses” then lined up their new Jags by the entry to their office. Even though they were leased cars replacing other leased cars with little or no payment increase, it just looked bad to the employees. Redouble, retriple, or requadruple your marketing efforts. Most firms cut marketing and other “unnecessary overhead expenses” in tough times. Don’t let marketing be cut. You probably need to spend more now, not less, just to get the same results. And, while you are at it, share all marketing victories with the staff and send any direct mail you put out to clients to your employees’ home addresses as well. These things can help boost morale! Don’t enact a salary freeze. This is always bad for morale. All you are saying is “no matter how well you do, we won’t reward it.” That sounds terrible! Even if you don’t plan on giving out any raises, why announce that? Don’t cut pay anywhere but at the top. Pay cuts for employees are even worse for morale than pay freezes. They are the last thing to do before closing the doors— permanently. This statement does not apply to principals, however. Get the early warning systems in place that you know you need. If you aren’t doing revenue projections, why? If you cannot see changes in backlog, why don’t you have the system in place that does allow you to see that? I could go on and on about “early warning systems,” but won’t. Just get yours working without delay! Be realistically positive about the future. You, as the leader or leaders, need to have some confidence and a positive attitude. Don’t act like the sky is falling. Project the confidence that the world will not come to an end and better times will be ahead. It’s been a while but I’ve been through a lot of these downturns. Do what it takes to keep morale up and you’ll be rewarded with a viable firm at the end of all this ugliness! Originally published 10/20/2008

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Zweig Group, a four-time Inc. 500/5000 honoree, is the premiere authority in AEC management consulting, the go-to source for industry research, and the leading provider of customized learning and training. Zweig Group specializes in four core consulting areas: Talent, Performance, Growth, and Transition, including innovative solutions in mergers and acquisitions, strategic planning, financial management, ownership transition, executive search, business development, valuation, and more. Zweig Group exists to help AEC firms succeed in a competitive marketplace. The firm has offices in Dallas and Fayetteville, Arkansas.