How do you account for your headcount?

In today's uncertain economic times, many companies are re-looking into their priorities, one of which is to retrench staff as a way to save on overhead expenses. However, removing jobs does not necessarily mean that a company saves on costs.

There are more job seekers today than there are jobs available. According to Singapore’s Ministry of Manpower, the total employment rate is lower for 2016 as compared to that of 2013 and 2014. Despite redundancies falling from 5,370 workers to 4,710, this quarter still has the highest redundancies since 2009.

1. Promoting from within
Strategically speaking, when you promote from within, it will be much more than just about saving money. It can be seen as a form of succession planning and, if implemented well, there are many rewards to be gained.

Firstly, you minimise external hires to the entry level, which means that you have less expensive payroll. In case the new hire has proven to be unsuitable for your company, the financial implications are much more than when hiring from within.

Moreover, you will do without the hassle of having to spend on advertising, interviewing, and orientating a new hire. You need only to inform the relevant supervisors to recommend their best candidates, and in that way also have only the crème de la crème of candidates to interview.

Secondly, it boosts morale as it shows that the company appreciates the talent it already has and is willing to grow their employees – by providing them with opportunities to develop and even add on to their skill sets with support for relevant external or internal training. By rewarding talent and hiring from within, you will foster a sense of loyalty.

Lastly, you know that they are already fitting well with the culture of the company as they have the track record to prove it.

Succession planning is important as you fill vacant positions. For every position that is left vacant, identify and develop your own employees who may have the potential in assuming a future leadership role. Employees who know their next role will have improved self-confidence. This will inspire and motivate them to do a better job because they know that they can achieve career growth.

2. Managing underperformers
If you have team members performing below expectations, termination, while it is a quick fix, is not always the solution. You must learn the root cause of the issue. For example, is it caused by lack of motivation or by lack of ability?

Performance problems can be overcome if there is a lack of ability. The employee might be assigned to the wrong job. Consider exploring the untapped abilities of that person by re-evaluating them. Take the time to actively listen to them and understand what it is that is bothering them.

Could it be personal problems or that they're just not a good fit for the position they currently have? Or could it simply be a need for encouragement and more realistic expectations? Providing additional training or retraining can usually solve poor performance but it is not the only solution.

Underperformance caused by a lack of motivation can be resolved by creating a performance improvement plan and having both the employees and employers commit to the plan. The workplace is, after all, a two-way street. Between the HR department and the supervisor providing the performance review; the supervisor and the staff; the employer and the employee.

3. Hiring interns / part-timers / freelancers
Another way to reduce manpower costs is to hire on a temporary basis namely interns, part-timers, or freelancers. Interns are paid a small amount of compensation and in some instances a minimum daily stipend.

For a company to hire on this basis, the hiring manager(s) must be well-informed on the rules and regulations mandated by Singapore’s Ministry of Manpower. This may not be a perfect solution; however, you’ll never know if he or she may just be the next Huffington, Zuckerberg, or Jobs.

Freelancing has increasingly become a solution to most companies who are unable to increase headcount and yet have an increasing amount of workload to tend to. Moreover, many Singaporeans are now switching to freelancing because of various reasons such as the ability of being their own boss, having the flexibility to work where and when they need to, etc.

There are various platforms such as Upwork, Freelancer, and DesignCrowd where companies can source for these talents. The company gets to save on expenses because the freelancer is treated as a project expense and not as a permanent employee.

Employ these strategies right away and you will be able to keep your turnover rates low and improve your talent issues without hurting your budget.