The cost of replacing an employee averages about 150% of his salary, something few businesses can afford, according to Laura Harris, author of Surrender to Win -- Regain Sanity. "We live in a time when business owners can no longer wait for possible improvements to the economy. Gas prices, the rising costs of health care and the current mortgage crisis are adversely impacting small businesses," says Harris.
Here are a few to help businesses stay profitable.
Tip #1: Make your employees a real part of the team. A business should work for the owner, not because of the owner's demands. If you can "release control" to your employees you can begin to have a company running on autopilot. Micro-manage processes, not people.
Tip #2: Establish a clear vision of what success means for your company. Make sure every member of the team knows what the vision is and how their day to day work fits into the plan. Knowing that, they can contribute to its success.
Tip #3: Create knowledgeable employees with training. Train and cross-train... each employee teaches the others how to handle their aspect of the business. That way no one is such a specialist he can hold the employer hostage. Employees should not want to be irreplaceable. If they are they can't even be promoted!
Tip #4: Update employee training annually. We have to re-invent our business often, or run the risk of becoming obscure. Include key employees in the planning process to keep consistent, well-defined programs in place. An employee trained years or even months ago will not understand today's hot products and services.
Tip #5: After defining each business process, put it all in writing. Everyone should learn the most effective way to accomplish a process so the employee who uses that process is not the only person able to do it. Another should be able to take over if needed. And that includes the employer's own processes -- you should be able to go on vacation or away on business without having the company fall apart.
Tip #6: Your compensation system should reward employees for team results. Design your business so that the team works together to fulfill goals. Encourage healthy competition, but ensure individual goals align with corporate goals. That alignment makes an employee part of the team, creating a harmonious atmosphere.
Tip #7: If you must hire, hire enthusiastic candidates. Employees can be the best investment in the healthy growth of your business. Harris often tells prospective new hires "this is the last job you will ever have!" By creating an opportunity an employee would be crazy to leave, you attract team members you want. Accept a candidate with less experience if he has appropriate strengths and a positive attitude; they can be trained to do the job and you won't have to break bad habits already learned.