Hire then Fire? The new dilemma for the entrepreneur.


On the off chance that you were paying attention in History, you may know the story of Robert Owen.

Born in 1771 and the son of a Welsh saddler and ironmonger, Robert Owen was, by 1810, the manager and part-owner of the New Lanark mill.

Now mill owners of the time were by and large a pretty ruthless lot. You can safely assume that working conditions in the early 19th century were not what a modern day health and safety inspector might accept. Twelve hours a day, six days a week was the normal working week and most mill owners operated the ‘truck’ system: this saw workers paid in tokens, which could only be exchanged at the mill owner’s shop.

Robert Owen changed all that at New Lanark. He paid his workers in cash, and he opened a store where they could buy good quality products at little more than wholesale cost. He cared about their welfare, and he educated their children.

He was in many ways the forerunner of both the co-operative movement and much of modern child welfare: a paternalistic entrepreneur, who cared for his profits but cared for his workers as well.

Fast forward to the 1980s and 1990s. We have trade unions, we have workers’ rights. But we also have the prevailing mood of the time. ‘Greed is good,’ ‘there’s no such thing as society’ and ‘lunch is for wimps.’

Is that still the consensus in business today? Hire. Fire. Get rid of people before any statutory protection kicks in. Staff are just a resource to be used and then tossed aside?

Look at those poor schmucks in Illinois. Bain Capital is making them train the Chinese workers who’ll soon be doing their jobs at a fraction of the cost! That’s real management – wringing every last cent out of the bottom line.

But is it? Is that really the way to run a business in 2012?

On the evidence of the conversations I’ve been having with Board members, the answer is a resounding ‘no.’

– I really need to take someone on, Ed. We’re short-staffed, standards are slipping and customers are starting to notice.
– So why don’t you?
– Because we need them now and we’ll need them in six months’ time. But I don’t know that we’ll need them this time next year. Look at the forecasts for the economy. How can I take someone on, give them hope and then let them go if there’s another recession?

There are a lot of things that make me proud to be associated with Alternative Board members, but not many come close to matching this conversation. Give or take a few words, I’ve had the same conversation three times in the last month: over the last year it must be running into double figures. And I can sympathise on so many levels.

I’ve run businesses where we’ve been desperately short of people. Where I’ve known that if I could only recruit one or two more staff it would make a huge difference – but for whatever reason head office have said no. It’s frustrating, de-motivating and demoralising – because you know you’re not providing the best service that you can.

And, like I suspect everyone reading this blog post, I’ve had to let good people go as well – which is about as unpleasant as business gets.

So what do I tell the latest three Board members that I’m having the conversation with? On balance, my instinct is to go for it. You’re not in business to miss sales opportunities and leave your customers disappointed. You’re not in business to have the nagging feeling that your company isn’t performing at its best. And very often someone new brings the impetus or the contacts that pay their wages.

As I look around the various Board tables I definitely don’t see people intent on wringing every last penny out of the bottom line. I see men and women with genuine concerns about the people they employ – or are thinking of employing. In a world that doesn’t always live up to the highest ethical standards, that says a lot.

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3 comments

  1. Suzanne · October 12, 2012

    It’s at times like that when a really good recruitment company can assist!
    Outsourcing a temporary worker can be an easy efficient way to cover this issue!!

    • edreidyork · October 12, 2012

      What a good idea, Suzanne – I don’t suppose you know any particularly brilliant recruitment companies situated in Yorkshire, and willing and able to help small businesses with their every employment need?!

  2. Pingback: Doing the Dirty Jobs « EdReidYork's Blog

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