Business Education

How to Handle Employee Requests for More Hours When Your Budget Is Limited

A few good, loyal employees have recently started approaching you seeking more hours. You want to accommodate them because these requests stem from a real need. (Though not necessarily a team player’s desire to contribute even more to your growing business.) Regardless, as a small business owner, you also face the tough challenge of balancing employee satisfaction with your company’s financial health. It’s a delicate tightrope walk, to say the least.

1. Understanding the Request and Your Budget

Employees often request additional hours for valid reasons. Sometimes, it’s about personal finances; they need more income to cover living expenses or unexpected bills. Other times, it’s a desire for more responsibility or to feel more useful within the company. They might feel they have more to offer than their current schedule allows.

Before granting their request, a thorough budget review is vital to making an informed decision. Look closely at your variable costs, like supplies and utilities, versus fixed costs, like rent. Understand your cash flow; where does money come in, and where does it go out? This view helps you see your true financial limits.

Next, create a clear, updated budget. It should detail all current labor costs and show how much room you have for extra hours, if any. After all, adding hours means more than just paying a higher wage. So, consider overtime pay rules if hours go beyond a standard workweek. Factor in payroll taxes, workers’ compensation insurance, and any benefits that might kick in with increased hours. And remember, there is also administrative work tied to more hours, like processing payroll changes.

From here, you’ll be able to calculate the total cost for each extra hour an employee works. Add wages, taxes, and any other related expenses to get a truly realistic picture.

2. Open Communication: The Foundation of Resolution

When an employee asks for more hours, approach them with empathy. Listen to their request without forming an immediate judgment. Your goal is to fully understand their situation. Schedule a private meeting to talk about their request. Choose a comfortable, quiet setting where you both can speak freely.

Focus on hearing the employee’s perspective and understanding their goals. Show them you value their work and their dedication to the business. Letting them speak freely builds trust and shows you care. Imagine an employee needing extra income due to a sudden emergency, like a medical bill or car repair. Understanding this helps you explore temporary solutions or alternatives, proving you’re on their side.

Still, be honest about your business’s current financial limits. You do not need to share all your detailed financial data. Just explain that the budget cannot stretch further right now. It’s important to set clear boundaries. Plainly state what is financially possible and what is not. Briefly explain your reasoning, focusing on the big picture without giving too much detail.

3. Exploring Creative Staffing and Scheduling Solutions

Flexible options can sometimes give employees what they need without raising the payroll. Consider remote work if their job allows it. A compressed workweek means they work more hours over fewer days. Job sharing could also fit some roles, allowing two part-time people to fill one full-time spot. Ask your employees what flexible work options they prefer. This might uncover solutions you hadn’t considered. Like cross-training.

Cross-training employees means teaching them new skills. This allows them to handle different tasks as business needs change. This can lead to more consistent hours for them over time without a direct increase in pay. It also makes your team more versatile. Also, look for skill gaps in your team. Then, create a plan to cross-train employees in those areas.

Review your current work schedules. Look for ways to make them more efficient. Are there tasks that could be done by existing staff without adding hours? Maybe you can redistribute work to better use the hours you already pay for. A retail store, for example, might rearrange shifts to better cover busy times using its current staff, rather than adding new hours.

Using part-time employees or freelancers can be a smart move. They can handle specific tasks or seasonal spikes in demand. This is often more budget-friendly than hiring another full-time person. It offers flexibility without the ongoing cost burden.

4. Alternative Forms of Recognition and Compensation

Valuable recognition does not always equate to higher compensation. Offer increased autonomy in their role. Provide opportunities for special training. Publicly acknowledge their hard work and dedication. These actions build loyalty and boost morale without touching your payroll budget.

Start an employee recognition program. Reward good performance and strong dedication in ways that don’t cost a lot of money. If your budget allows for potential future growth, tie extra pay to business success. When the company does well, employees get a bonus. Or, offer a small share of profits when certain goals are met. This motivates them to help the business grow. Research shows that incentive-based pay truly boosts employee motivation and output.

Investing in an employee’s skills helps everyone. Offer access to online courses relevant to their job. Pay for workshops or industry certifications. This benefits the employee by growing their career. It also helps your business by having a more skilled team. It is a valuable form of compensation that pays off for both sides. Fund online courses, workshops, or certifications related to their job. This shows you care about their future.

5. Planning for Future Growth and Increased Capacity

Think ahead about what needs to happen to allow for more hours. What financial conditions would make it possible? Create different scenarios for your budget. This proactive approach helps you prepare for the future. Outline specific revenue targets or cost savings goals. Reaching these benchmarks could open up the budget for additional staff hours.

Keep a close eye on your business’s performance. Monitor key metrics, such as sales figures and customer acquisition costs. Tracking these Key Performance Indicators helps you find opportunities to expand and shift your budget. This data shows you when you can afford to invest more in your team. Define the most important KPIs for your business. Track them regularly, looking for trends and opportunities.

Having a financial cushion is smart. A contingency fund helps you manage unexpected events, both good and bad. This fund provides the flexibility to increase staffing when a sudden opportunity arises. It also protects you during slower times.

Want to Accomplish More?

Do you want your company to grow faster and earn more while spending more time with your family doing everything you started your business to do?

We can make that dream a reality. Give us 30 minutes, and we will show you how to get your life back. Skeptical? Good! Put us to the test.

You can call us for your free appointment at 480-636-1720, or, if you prefer, send us an email. You can also visit us at Waters Business Consulting Group to learn more about us and the services we offer.

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3 Ways Business Owners and Entrepreneurs can Find more Free Time

March 8, 2021 No Comments

A substantial percentage of established business owners and fledgling entrepreneurs have experienced significant change over the course of the past year. Some had to make very difficult decisions and enact hard changes in order to survive. Conversely, some have been in the fortuitous position to thrive. Regardless of their circumstances, too many entrepreneurs and business owners struggle to find free time. Fortunately, there are some effective strategies to find more free time and enjoy it. The Dreaded Free Time Paradox The most common problems business owners have when it comes to free time is either not recognizing it, or failing to indulge it. In other words, when there’s free time available, business owners and entrepreneurs most often either prefer to spend it working, simply defaulting to a workaholic mindset. So, it’s often the case that they don’t have any free time, as much as it is they won’t take time to actually enjoy it. Time freedom is about spending your time doing what you really love doing with the clients and people who mean the most to you. Having more freedom of time is about having the ability to live a full life and have the time to pursue other interests outside of work. But finding time freedom for entrepreneurs can be tough. — Thrive Global This creates a cyclical scenario where any ostensible free time is put either toward their work or, is spent on distractions. That’s often more advice given about business owners seeking free time. That is to say, to identify and eliminate distractions, because they divert away from the task or relaxation at hand. Because entrepreneurs are action-minded people, they mistake any type of work as being valuable. Of course, that’s just not true. 3 Ways Business Owners and Entrepreneurs can Find more Free Time The advice usually given to free up time is to rely on technology, innovative tools of the trade, and eliminate redundancies. Those are all great ways to help streamline your operation, but these mostly work around the margins, and don’t address the core problems. Here are three ways business owners and entrepreneurs can find more free time: Stick to a schedule. It’s very difficult, if not impossible, to find free time in an unstructured environment. The old Friedrich Nietzsche philosophy of “out of chaos comes order” simply doesn’t apply to this situation. So, get yourself on a schedule and follow a routine. It can be flexible and should not be rigid, but should provide you with structure. This will greatly cut down on distractions, and force you to focus on the highest priorities, and work your way down to the lowest. Put your business on a budget. Before you scoff, remember this — a budget doesn’t always mean spending less, it means always spending smartly. Too many business owners either spend their time worrying about their finances. Others know their general financial situation, but dwell on every possible contingency. In either case, they waste a great deal of time worrying, because they really don’t have a plan for their company finances. Money just comes in and goes out, but with very little accountability. Creating a realistic budget allows you to operate your business with a lot more certainty, and that in turn, will create more free time. Hire (back) help. You might have responded to the pandemic and ensuing chaos in a number of ways. Perhaps, it was necessary to reduce your payroll and take on more responsibilities yourself. Or, you’ve been taking on more work personally, because you haven’t found the time to hire people to help. The longer this unnecessary stress goes on, the more you risk burning out. It not only steals away valuable downtime, it is also counterproductive. So, get yourself on a schedule, lay out a budget, and hire on some help when and where needed. What other suggestions do you have for creating more free time? Please take a moment to share your thoughts and experiences so others can benefit from your unique perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.

Pros and Cons of Work-Share Programs

April 29, 2020 No Comments

In times of uncertainty, particularly when there’s a financial crisis, work-share programs can serve as a temporary solution. But, these systems are not perfect. However, that doesn’t necessarily mean you should outright dismiss the option. Read on to learn more about the pros and cons of work-share programs. Biggest Downsides of Work-Shares As the nearby quote explains, work-share programs are offered by local governments to help small businesses in times of need. They give businesses the ability to reduce employee hours without having to resort to letting them go. As you might imagine, work-shares have their pros and cons. And, the first downside is that your business (or employees) might not qualify. If it does, another downside is that it could be more lucrative for team members to find alternative employment. Work-share programs let businesses temporarily reduce the hours of their employees, instead of laying them off during economic downturns. Technically referred to as short time compensation, the goal of work-sharing programs is to reduce unemployment. Work-sharing should not be confused with job sharing, which allows two part-time employees to share one full-time job. Instead, work-sharing allows a full-time worker’s hours to be reduced, in lieu of laying off the worker. —National Conference of State Legislatures Of course, if there’s an outright unemployment option that effectively supplies comparable or more compensation, that’s another downside. Then, there’s the matter of timing. Meaning, how long you’ll need the assistance and whether or not it’s sufficient to carry you and your employees through. Top Advantages of Work-Shares Now, there are obviously good things that come with work-share programs. These can be a real lifeline when you and your business needs it most. Here are some of the largest benefits of work-share programs: You can avoid layoffs. Okay, the most obvious advantage is the fact that you don’t have to resort to firing team members from your company. Work-share programs help you to keep your employees on the payroll, even if it’s a smaller one. It provides ongoing continuity. Another benefit is that your business can essentially carry on as usual (or as good as possible) for at least a short period of time. That can really help to save your business’ operations and keep productivity going. The arrangement helps maintain morale. Yet another upside to a work-share program is it helps to keep morale up since you’re keeping people employed and in a familiar work environment — even if it’s temporarily in another setting. You don’t have to start over again when it’s over. When the time comes to resume normal operations, the ability to retain employees helps you avoid having to hire all new staff and start over by training from scratch. What other pros and cons would you add to the list? Please comment and share your thoughts and experiences! Interested in learning more about business? Then just visit Waters Business Consulting Group.

Top Ways to Deal with Critics

August 9, 2017 No Comments

There’s simply no way to run a business without dealing with critics. As an entrepreneur, you’ll face doubt in many forms. You’ll face inner doubt, ruminate over which next step to take, receive less-than-positive feedback, and plenty more. What’s more, you’ll have to do so much more, like find ways to keep company secrets safe and navigate through industry changes. Running a business isn’t for the faint of heart and when critics chime-in, that’s precisely where it will hurt most. Top Ways to Deal with Critics Let’s face it, there is no shortage of bad news to discourage you. For instance, if you dream of opening a retail shop, no doubt the latest news out of that sector is troubling. But, it’s commonplace for unpleasant experiences to unfold. This certainly isn’t to say it’s all bad all the time. In fact, that’s part of the problem. When things are going good most of the time, criticism is the biggest wet blanket. Doubters rain on your parade and you scramble for cover. Criticism is part of life, but often times being criticized can make us feel like we aren’t good enough, like we’ve done something wrong, or even cause us to be uncertain about our future. People often take criticism as a personal attack, but in reality, criticism can often be positive. —Fast Company While it’s normal to experience periods of struggle, eventually, you’ll fight through and start to win. Any setback serves as a valuable lesson going forward. And, over time, you’ll enjoy long periods of success without much or any trouble. Then, seemingly out of nowhere, the critics will appear. That’s when you need to be prepared. Otherwise, you’ll become too distracted and won’t have the energy to fully function. So, here are some of the top ways to deal with critics: Teach them, no matter your feelings. Okay, so you don’t particularly like the person who is criticizing you (or your business). And, it’s natural to take it personally because it is your business. But, don’t let this become a missed opportunity. Instead, redirect your feelings and teach him or her. You’ll probably enjoy some accomplishment while turning a critic into a fan. Tell them the truth and do not be fake. You’ll receive at least a little criticism because of your success since it breeds jealousy. That jealousy will manifest into criticism and possibly into anger, even hate. If this does happen, don’t make the mistake of defending your success. Instead, talk about your failures to allow them to relate. Accept that doubters will always be there. Keep in mind that doubt is not the same as an insult (though you just might feel insulted). Rather, doubt is a disbelief in something unfamiliar. And, it isn’t personal, just a way of expressing uncertainty. So, find out what’s doubted and use it to teach. Trial and error isn’t perfect and that’s okay. Sometimes, a new idea can come off as foolish, gimmicky, or silly. But, trial and error are part of business. You need to experiment to know what does and does not work. If you receive criticism, accept it and just move on. Know when it’s time to give a sincere apology. If the criticism is legitimate, you might need to apologize. Know when it’s the right time to say you’re sorry and be sincere when you do. You’ll learn from the experience and move past the criticism, which are good things. How do you deal with critics? What strategies do you use to cope with doubters and doubt? What are your most useful experiences with critics? Please share your thoughts and experiences by leaving a comment. Interested in learning more about business? Then just visit Waters Business Consulting Group. [shareaholic app=”follow_buttons” id=”26833294″]