In a meeting last week, a colleague of mine – Alan Farman – reminded the managers in the meeting that “your best people will leave first”during periods of uncertainty and expected cut backs. This is an axiom of business, but it is my experience that many managers and entrepreneurs have never learned this important fact. This is the reason that you’ll see key employees receive bonuses and pay increases after a bankruptcy filing. The company is going to need the best and brightest of their employees to help see them through the trough, so they’ll often pay them more to keep them there. This happened to me when I worked at Covad Communications. We entered bankruptcy in the fall of 2001, and that’s when I started getting pretty nice bonuses. I didn’t understand why at the time – this was, after all, the first time a company for which I worked filed for bankruptcy protection.
When times are hard, you’ll have tough decisions to make. One of them will be figuring out how to hold on to your best – and probably highest compensated – employees. Don’t make the wrong decision; figure out how you can keep them on board, before they “flip the switch” and decide that they need to move on.
Grow Strong!
Coach Grev
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