Rallying the Troops

It's easy to motivate your staff in good times. But how do you keep them soldiering on when business is hurting and raises are history?

NEIL LEBOVITS WAS desperate. The newly appointed president of Saddle Brook, N.J.Ðbased staffing firm Ajilon was facing a perfect storm of employee malaise: Turnover among his permanent staff was sky-high, and with revenue down by half, morale was in the tank. The problem really hit home the day he hosted after-work drinks for his East Coast employees and, out of 50, all of five bothered to show up. "You don't have to be an industrial psychologist to know something's wrong," he says.

Lebovits wanted to jack up employee spirits but, like many executives these days, "just didn't have the money" for big raises. So he pushed through a raft of reforms that he knew wouldn't break the bank. He initiated monthly conference calls with the entire company to discuss management decisions point by point. He added a host of in-house training programs on anything from marketing to time management. He gave every staffer three "YDOs," or Your Days Off, a year — no questions asked. And he set up an e-mail address devoted to collecting employee ideas — every one of which Lebovits responds to personally.

Since then staff morale has done a 180. Lebovits even gets notes now from branch managers gushing about how they feel reenergized. "In the corporate world you never see letters like those," he says. And happier employees make better-performing employees. One tangible result: Revenue is edging up.

The dilemma Lebovits faced isn't unique. In this economy it's a struggle to keep your staff happy and productive when layoffs are happening all around, business is sinking and raises are out of the question. While there are no easy answers, some beleaguered bosses have found ways to boost morale even when things are at their bleakest — ways that won't cost a ton of money.

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Change things up.
For overworked employees, a job-rotation program is a good way to keep them fresh and engaged, suggests Ron Rosenberg, president of customer-service consulting firm QualityTalk. Don't make it a company-wide game of musical chairs, which could throw everything into chaos; just offer it as a selective perk for talented folks who want to expand their skill set. By doing that, you may even discover someone is a better fit in another department. Herb Greenberg, president of Princeton, N.J., psychological testing firm Caliper, once shifted a lackluster proofreader into a sales job. He quickly proved himself a "superstar" — and now handles the firm's biggest accounts.

Find new ways to reward.
Recognition can come in many forms, not just bonuses and raises. A new title is one easy way to acknowledge an employee. Or, since you probably have some vacant space these days, move him from a cube to an office, or give him some prime real estate near important execs. "Some people love that because it puts them next to the power brokers," says Tom Welch, author of Work Happy, Live Healthy. Public recognition is a powerful motivator too, such as an Employee Wall of Fame.

Get creative with training.
When money is tight, your first instinct may be to ditch education initiatives altogether. After all, who can afford to fly employees to seminars or pay for them to go back to school? But that is a sure-fire way to make employees feel stifled. Instead, try taking the training in-house. It's a lot cheaper to bring in an expert than to send employees out. Beverly Murray, president of Cary, N.C., design and marketing firm R+M Creative, holds staff lunches with guest lecturers — on topics ranging from corporate branding and direct mail to Web site development. "The staff said they wanted more educational activities," Murray explains. "So now, every time, one employee is assigned to come up with the topic, to arrange a budget and to hire a speaker."

Keep employees in the loop.
Take a page from Lebovits's book and hold meetings with everyone invited from the CEO to the data-entry clerks. If employees feel informed, it cuts down on gossip, which tends to be rampant in difficult times. "In the absence of official information, employees make up their own versions of what's happening — which can be worse than the reality," says Rosenberg. Rich Thompson, a VP in St. Louis for Ajilon, says the meetings Lebovits has held have fostered a refreshing openness. "It allows us to focus our attention on the company and not on whether or not we should be worried for our jobs. It's nice to know where you stand."

Listen up.
Human instinct is to hunker down when there's bad news and talk to only a tight coterie of advisers. But you should be doing exactly the opposite if you're trying to prop up morale. Asking employees for their input makes them feel empowered. "For instance, we always decide as a team what charities we're going to give to," says Murray. "Making decisions like that lets (workers) know they're valuable. And you're hiring these people because they're smart, so why not leverage that intelligence?"

My Favorite Interview Question
What's your No. 1 do-over in life?
— Tom Thivierge, GM's director of talent acquisition

Why He Asks It: "A lot of people say they're divorced and would like to get married again, or regret they did poorly in school. They'll say, 'I didn't put enough effort into keeping my relationship fresh,' or 'I didn't put enough work into my classes.' What's telling is how they apply this knowledge to their current situation. They might say, 'In my next marriage, I'd listen more. I'd approach it as a lifelong experience.' That shows me they've learned how to change and develop."
— Chris Taylor

Inside Track
With many companies in a mire, there's growing demand for turnaround specialists, who can quickly assess problems and take action to fix them. Lori Wathen, director of organizational development for turnaround consultants AlixPartners, explains what firms such as hers look for in hires:

Education: Junior applicants will need an MBA, but those with years of corporate experience can get by with a bachelor's in business, finance or accounting.

Experience: For senior slots, eight or more years as a controller, or as a VP or director in operations or finance. More important, you must have deliberately taken permanent jobs with struggling firms more than once — and helped them recover.

Don't Bother If...you're thin-skinned. You'll need to make tough choices — from eliminating product lines to cutting staff.

Pay: Salaries range from $80,000 to packages on par with the client's CEO.

Perks: For crisis junkies, it's the thrill of diving into one stressful, high-adrenaline situation after another.