The cost-of-living crisis brings more salary conversations to managers. How do you deal with this?

While the cost-of-living crisis is becoming the same trendy as the “quiet quitting”, we need to think of strategies to make the salary talks positively impactful on your business, not otherwise. 

While I know for sure, there would be some managers who would think that it is ok to let go of their low-performing staff and it will help cut costs, there is nothing riskier here than silence and lack of preparation and strategy. Because the competition for great talent is not downsizing and you may not be able to keep those who bring results to your business if they will also start thinking of improving their income or improving their well-being for the same paycheck. 

Here are the 3 tips that will help you to make sure that your people feel protected and can focus on continuing to bring great results to your businesses throughout the crisis:

  1. Don’t avoid the topic completely. There is nothing worse in a time of crisis than silence about problems that it brings and a lack of acknowledgment that people may struggle. Talk to your people, and ask them how they do – personally in 1-on-1s and team-wide over surveys or internal interviews – to discover and acknowledge the size of the problem. Vocalize what is truly happening with your people and your business. Your business also might struggle in today’s realities of economy and competition. Don’t silence the problems, make them visible. This is always the first step before the actual action and a positive change. 
  2. Help people with the capacity you have and be creative. Sometimes, the business is not in a position to make 10-20% increases to their payroll completely – make sure you can allocate some budget for a bonus here and there when people do make the extra mile and bring results that help your business grow even through the hard times. In case even this is not up to your P&L capabilities, think outside of the box. People may appreciate some extra 5-10 vacation days instead, which will help them spend time with their loved ones or do something of meaning for their well-being. Extra well-being support and initiatives will be something the team might appreciate very much. This type of extra, non-monetary things can actually bring some good quality currency to your people – care, appreciation, and acknowledgment. 
  3. Make sure to open up and keep the conversation going with your people. Even when you did step one and had made some communications with the team acknowledging the tough stuff, it is never enough to make it a one-time thing. Make sure you’ve implemented a regular practice of the conversation and feedback on the team level. As you might not catch the peak of the crisis and your best people may slip through your fingers when they are headhunted or just see better opportunities on the market at some points in time when you haven’t even thought they might struggle. “But we have already spoken about that, and even implemented some initiatives, and gave a bonus last year. What else we could do?” This is something I’ve heard and this is something I will always respond to with: “Life is fluid, things are developing or changing quickly. When you would think this way about your business or a product – you would be nowhere. Imagine, you have launched a product to the market – is that it? All done and good? No. You are talking to your customers and making sure they are not leaving, making sure they still love your product and that it is relevant. You collect and listen to their feedback, and you iterate and develop your product offering. Why does it have to be different with your people?” 

And we have to remember that the times like these bring stress and anxiety to everyone, despite their level of performance, their level of income, their level of professional seniority, or their type of employment. Kindness and care are something you should share with everyone! 


With love,

Your Own Coach. Olga.

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