Make your cuts quickly
While cutting costs couldn’t be Travel Solutions’ only strategy, it is a fact of life in severe downturns. Still, Krings wanted to do it with some strategy. The first thing she wanted to do was be careful about who she let go.
“We have a very rigorous human resource and development initiative, and we identify those who are in trouble basically and who are having difficulty performing, and we document those things and we coach them,” she says. “But there is this obligation that we have to tell somebody, ‘You’re not going to be successful here,’ because they may just hang around for the sake of drawing a paycheck, and it hurts them because they know they’re not a contributor and it hurts everybody around them because they’re the ones that have to pick up the slack.”
While you can probably name the people you’d cut quickly if you had to, the second cut is the deepest. Krings says the second group of layoffs came from people they were coaching whose career track had them some ways from being highly productive.
What’s important at each stage is to tell people and do it in the same day if possible.
“We were sharing with everybody, ‘This is what’s going to happen and here’s what we’re looking at,’ and it happened very, very quickly in terms of laying people off, because we don’t like this stuff to linger,” she says. “If you’re going to take action, you announce it and you do it. You do it fast and you do it well.”
If you don’t do that, you’ll lose the wrong group of people.
“The timing is absolutely tethered with the success of the emotional outcome,” she says. “When you let it linger, folks will again start drawing their own conclusion. You may end up losing people you want to keep because they might be some of the most employable and they hop on that job search bandwagon and you’ll be out your top producers.”
By doing cuts as she announced them, Krings was surprised to find that what she thought would be a somber day was actually an OK day. In fact, a few people who knew they weren’t cut out to stay at Travel Solutions thanked her. Not everyone was that happy, of course, but the quick cuts made for a clean break. In the time following the layoffs, the company was able to ask others to make concessions because it told everyone that each person was a part of a group the company wanted to keep. Krings told hourly people they’d have to take a few less hours and were surprised to see people volunteer.
“Initially it was, ‘Gosh, I hope I’ll be able to pay my bills,’” Krings says. “Then it turned into we had some folks who came forward and volunteered, and we had one gal who said, ‘I’d love to take the summer off; I just had a baby. Can I come back in September?’ and we said, ‘Yep,’ that takes a little bit of stress out of it. … The general consensus after a couple of weeks was we are all in this together, and we’re kind of fortunate that we have the option to make this choice instead of laying off a few more people who we considered people we wanted to retain.”
All this is not to say things are perfect at Travel Solutions, but Krings’ multifaceted attack of the downturn has helped her company start to dig its way out.
“We’re starting to see teeny-tiny upticks,” she says. “I don’t think we’ll be a turnaround that we go from one day to the next and everything is all rosy, though.”
But while things won’t immediately be all rosy, Krings’ plan to do more than just cut has put Travel Solutions in better shape than before the downturn.
“That’s the biggest part of what I feel we’ve been most successful at, is using this as an opportunity to build a plan that’s sustainable across a fairly long period of time and provide us a business model that keeps us in a healthy state,” she says.
How to reach: Travel Solutions Inc., (614) 901-4100 or www.ts24.com
