This is especially true for contractors where nearly 100% of the capabilities and capacity that are competitive differentiators are the experience of your people.
Now we are faced with lots of unknowns, yet we must act decisively.
Here are some things to consider and plan for with your team. Plan for them as if you had to decide tomorrow and hope that you never have to execute this plan. These are some of the toughest things we worked through with clients during 2007-2011 as they navigated the recession. Most grew through the recession and/or accelerated growth much faster in the recovery.
Tough conversations are just that: tough.
Assume 50% Reduction: As bad as this sounds, develop a plan to cut 50% of your workforce - both office and field. Don’t base it on the projects in-progress. Base it on what you need to survive a recession and thrive in the recovery.
This will force many difficult conversations and will be a series of full day sessions with the key department heads, executives, and superintendents. Cutting 10% is easy. Cutting 50% to survive is difficult. Cutting the right 50% to survive the thrive is the magic if it comes to that.
You will have to rigorously discuss, weight, and rank people on the value of their skill set, their capacity to handle huge workloads, their adaptability, their versatility, their resilience, their loyalty, their runway, their attitudes, etc. Like the nuclear option, hope you don’t have to ever use it but the planning process is invaluable.
Remember that each cut will be a morale hit, whether it is 10% or 30% of the workforce. Prepare to cut deep once if you have to, rather than subject your culture to death by 1,000 cuts.
Balance these decisions with preservation of your capital and company.
Take the best care of your people that you can if you must take action.