Figure out who’s performing and who isn’t
Going through a budget is never easy, but it’s a little bit easier if you know the things that have to be held sacred. At Huron, there are some functions of the business that Holdren simply can’t cut.
“The thing for me is we just have to be sure that we’re giving good client service and we’re being loyal to true performers who have been good for Huron in the long run,” he says.”
Finding those things you have to keep goes back to your basic vision. Huron prides itself on client service and holding up the people who excel in that field, so those areas don’t come under fire. Once you get past that, Holdren says, there is no one- or two-step process to trimming the budget.
“There’s no secret sauce,” he says. “What you’ve got to do is look at the line items, look at the details.”
That means an evaluation that should lead you to who your performers are — and, more importantly, who they aren’t.
“You owe it to all your employees and shareholders that you aren’t keeping people around who aren’t performing,” Holdren says. “So if you haven’t done a good job of assessing your people, the first starting point is (making) sure that if 5 percent of the work force is not performing, you do what’s best for the 95 percent.”
If you don’t have a system for figuring out who is up to the task, something Holdren does might work for you. Each of Huron’s nearly 3,000 employees has a goal-setting meeting with his or her manager at the beginning of the year where they set goals for the employee. If people have promised to improve on things and simply have not, you might have an easy answer to your hard decision — especially if you mix that in with their overall productivity.
“The way I basically explain this for our employees is, the worst place you can be is to not to do what you said you’re going to,” Holdren says. “So you’re the employee at the most risk if you’ve decided not to follow the conditions of employment. Now some people cannot follow that and be a good performer, but if their performance falls, then they’re at risk. If you have done everything Huron has asked of you and you’re making a good effort and just haven’t had as good a year, OK, you’re going to move up the pecking order. If you do everything Huron asks and had a good year, then you’re pretty bulletproof.”
And while Holdren has great sympathy for how an economic downturn can hurt his people’s overall performance, he also knows that looking at the performance across several peers will show you who is hurt by the market and who just isn’t performing.
“The one thing that I will not tolerate is people not being in the marketplace or not giving effort,” he says. “So first and foremost, you can imagine with 175 to 200 managing directors not every one of them is going to give the same effort. So, from that perspective, it’s pretty easy for me when I look at the results to know the decisions that we need to make. It’s very, very obvious about people who are market relevant, who are team players and who give you effort.”
