Trouble Alert: Staff Inflation!

Is your business expanding? Are you getting busier? Are you spending most of your day at work? Some may tell you to hire an assistant so that you can focus on growing your business rather than administration tasks that detract from your company’s purpose. After a few months, your assistant says that he is very busy and he needs an assistant himself and you recruit one. This secretary finds that she is so busy that she doesn’t have time to make a coffee and so she asks your assistant for an assistant, who naturally recommends that you take on an assistant for his secretary! In a short period of time you have employed four extra people. They all need paying. They all have personal problems that need to be dealt with.

As the business becomes more successful, the above situation starts happening in all departments of the company.

If you are not careful, staff inflation will get you out of control. You will start asking yourself: WHO AM I WORKING FOR? The answer will be: MY STAFF!

Now you need a HR department to look after all of them. Which means more people! They will then tell you that your staff must have i.e. safety training and according to the regulations you have to employ a safety manager! And so it goes on! Staff number in your company is growing and growing! And you cannot seem to stop it!

If a cash flow crisis comes, one of the most essential issues is to cut expenses. If you are in a bad condition, the fastest and most obvious way to do this is to reduce staff numbers. However this is quite difficult mainly due to employment legislations. People you can release quickly are those who generate the most income for your business. The sales people! This will leave you with a bigger problem. You are now left with a disproportionate number of admin staff, leaving the remaining income-generating employees to produce even more income in an economic crisis period, just to stay still!

You must remember that as quickly as the money is flowing in, it can just as quickly stop. Make sure you save for a ‘rainy day’!

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