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Impacts of Cost Cutting

Tuesday, September 15, 2009 by Slaughter Development

In an anonymous opinion piece, one former employee explains how a reduction in expenses destroyed productivity and morale. Mark down another incident for the law of unintended consequences.

The following quote comes from the Adventures in IT column in Infoworld:

Here’s the kicker: Because analysts and admins were now employees of different vendors, we were forbidden by our respective management to speak to each other directly. All communication was to be done via the tracking database in the tickets that were created by the out-of-state help desk. Since most of us were physically located in the same complex, it was an extremely frustrating situation. There were several times when an issue would come across our desk and we could see the guy at the other end of the cubicle farm who could resolve it, but we were forbidden to take it to him directly.

On the one hand, there’s a certain beauty to a business operation that is so efficient and cleanly segmented that it can be completely outsourced. But as The Methodology Blog documented during Remote Work Week, shifting tasks so they occur in different locations is more complicated than writing a memo. Management might reduce costs, but how much will savings increase frustration and negatively impact employee success?

The story from Infoworld refers to an IT department; however changes in productivity and stakeholder satisfaction due to cost cutting occur in virtually every department. If your organization is thinking about reducing expenses, consider reaching out to Slaughter Development. We help companies make sure that cutting costs does not lead to an unexpected decline in productivity and satisfaction.

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Like this post? Here are some related entries from The Methodology Blog you might enjoy:

The High Cost of Conservation - The administration at Central Michigan University has managed to reduce water consumption by nearly 10%. But to make up for lost revenue, the city of Mount Pleasant may need to raise water fees for everyone. Read on »
Cutting the Right Waste - Local Indianapolis sales coach Jeff Bowe points out that sales requires being “vigilant in using limited time.” But how should sales professionals manage their time effectively?
Read on »
Over-investing in BPM Technology - In an eWeek article, Laura Mooney advocates “investing” in business process management software.  Unfortunately, making yet another technology purchase will only contribute to the methodological problems in an organization. Read on »
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