As we continue through the Process to Financial Recovery (as defined by the Government Finance Officers Association) we come to Step 3: Generic Treatments.
At this point, after recognizing the problem(s) in the business and mobilizing a core team to carry out the strategy for recovery, cost-cutting techniques may need to be enforced without hesitation when time is of a factor. The techniques that generally work in this type of situation have clear short-term benefits with long-term ramifications and are at the same time able to be undone with a reasonable amount of effort.
Examples include: reassessing personnel equipment needs, short-term hiring freezes, as well as allowing voluntary part-time status. Let’s talk about these a bit more:
• Reassess Personnel Equipment Needs – In certain businesses there may be some personnel that have been assigned different equipment that may not be essential to the job at hand. Reassess.
• Short-Term Hiring Freezes – This practice can be implemented to last for only a few months or leave a position vacant in order to provide some instant relief.
• Allow Voluntary Part-Time Status – This short-term solution is a fairly non-contentious way to save much needed salary expenses.
Following this step, a company will continue the process by performing some Initial Diagnoses… which is the 4th step and will be what we address next time.
Remember to always make an informed decision at all times,