As discussed in my previous post, our new economy has forced business’ to do more with less causing the workforce to become more productive and resourceful. The competition has created a contraction of margins that will not tolerate inefficiency, complacency, high wages or any presumption that future success can be achieved through practices of the past. As a result, workforce competition has also increased and the rules have changed, causing the unemployment rate to rise.
As a business succession planner, I give constant thought to how business success is maintained during diverse economic environments, which are constantly moving. I define succession as simply the continuation of success and success is dependent upon reasonable labor. “The doing more with less” mindset, however; has tipped what I call the “Employment Probability Teeter-Totter” giving those who are more flexible and willing to dig deeper more value over those who are skilled and experienced.
Imagine if you will, Behavior, Attitude and Cost (expected compensation) on one side of a teeter-totter balanced with Skills, Knowledge and Experience on the other. In an ideal economic environment there should be balance. In a high performing, economic environment like we experienced between 2002 and 2007, the teeter-totter tilted toward acknowledging those employees with Skills, Knowledge, and Experience due to high production requirements. In the current tight economy with little to no margin for error however, business owners have concluded they must take action and that Behavior, Attitude and Cost are more important than Skills, Knowledge and Experience.
The immediate presumption, which from my perspective appears to be valid, is that with lower production demands there is time to recruit new receptive talent that is capable of learning the critical skills while being open to new innovative ways of getting the job done at reduced cost. And success through survival demands reduced cost. In many cases it appears that the unwillingness of long standing employees to think out of the box; to reconsider the market value, their skills, knowledge and experience as well as to consider new more innovative ways of doing things negatively effects productivity creating employment incompatibility.
Those with Skills, Knowledge and Experience become part of the newly unemployed and stand on the sidelines while those with the Behavior and Attitude who aren’t handicapped with an entitlement attitude work enthusiastically to gain the Skills, Knowledge and Experience to significantly impact productivity which subsequently increases personal compensation.
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