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Home > Customers, Finance, Leadership > Businesses Need to be Seen to Tighten Belt

Businesses Need to be Seen to Tighten Belt

April 28th, 2009 Leave a comment Go to comments

In today’s tough economic environment, everyone is hurting – busineses, employees, their suppliers and of course the customers.  In these tough times, it is important the all parts of the business tighten their belts and the business is seen externally to tighten its belt.

If the company does not do this, it runs the risk of disenfranchising their employees and their customers.

The first thing a company must do when tightening its belt is make sure that it is even across the business.  Many businesses are closing departments and firing staff.  However, what they should not be doing is increasing the perks for the executive team – like adding secretaries for senior management, holding expensive retreats at 5 star hotels and continuing to fly business class when it is not needed.  If a company does this, it creates and us and them culture and the employees will lose faith in the management team.  This is not good – especailly in these tough times!

The second thing a company must do is make sure that it is seen to be tightening its belt – especially with its customers.  Whether a company likes it or not, the customers are probably hurting in these economic times and if a company maintains or increases its prices, it is important that they are not seen to be wasting money on internal extravagences – like expensive conferences or management retreats. 

Nothing can disenfranchise a customer more than to be asked to pay more for a product and serivce and then to see those additional fees not being used to improve products and services.  Your business reputation will last long after the financial crisis is over.

We all remember what impression the CEO’s of Ford, GM and Chrysler had on the US public when they flew in private jets to Washington to ask for money!  Not a smart move.

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