“Thank God for the Recession” — CEO Says…

Posted on: Nov 10, in: Employee Engagement, Employee Engagement Tip Sheet No Comments

I was working with a group of senior executives recently in Columbus, Ohio and we were discussing the “costs” of keeping the disengaged, deadwood employees on the payroll. By the time the discussion was finished one CEO blurted out “Thank God for the recession.” Why? Keep reading.

The cost of holding on to what we refer to as the “actively disengaged” worker is substantial and typically underestimated by CEO’s and their senior leadership team:

1. The wasted salary and other organizational resources (i.e., training, benefits, staff time) dedicated to these non-performers.
2. Their negative impact on the teams they participate in as they fail to meet deadlines, and under-perform to such a degree that others have to “double-up” in order to fill the gaps.
3. Their viral impact on everyone they touch in the organization – spreading their negativity, bad attitude, and gossiping at every opportunity (multiplying their dysfunctional behavior exponentially).
4. The negative impact on the customer experience. As we like to say at Engagient, it is impossible to have an extraordinary customer experience if your employees are disengaged. The quality of your customer’s experience is directly related to staff behaviors, and disengagement suppresses virtually every b behavior that contributes to customer passion and loyalty.

The discussion then shifted to “Why do we keep them around if they are so destructive?” Here again, there are numerous reasons and excuses:

1. Most people and organizations are simply conflict avoidant and fail to act on the obvious.
2. Some positions are hard to fill, and the under-performer on the drill press remains because she is hard to replace. We would rather endure the poor performance than go through the process of hiring and training someone new.
3. The paperwork and documentation many companies now need to have in place to reduce litigation risk can be substantial, and the extra burdens this places on already overworked staff encourages us to hold off – so the slacker stays “for now.”

That’s when one of the CEO’s said, “Thank God for the recession,” a reference to the fact that he had used the recession as an excuse for firing the worst of his staff. What he was either unwilling or unable (for whatever reason) to do in “normal” times, he was able to do more easily within the frame of, “the recession has forced us to cut back.” Everyone laughed when he said it, but then someone asked, “How many of us have used that as an excuse?” At least 75% of the CEO’s in the room raised their hands!

Now this raises an interesting issue. As economic conditions begin to get better and we no longer have the recession excuse, what can we do to make sure we hold ourselves accountable for a high performance culture? At Engagient, we have a few ideas about that so stay tuned to this blog, check out our other resources, tune in to Engagient Radio, or just give us a call.

BEST PRACTICE TIP – Don’t wait to take action on the actively disengaged. In good times and bad, these black holes of commitment, enthusiasm, and productivity drag down those around them and send the message that poor performance is tolerated by senior leadership.