Thursday, May 14, 2009

Oce: Consider reducing FTE's by repurposing

Oce to Accelerate Cost Reductions
from WhatTheyThink: "The additional cost savings comprise a headcount reduction of 800 FTEs, including the phased reduction of headcount in the supply center in Poing (Germany) by 250 FTEs, as well as other savings. The headcount reduction impacts all operating companies and supply centers worldwide."
There's no way to get around the need to reduce overhead. The good news is that lots of the overhead is not necessary to succeed. But, instead of just cutting people use the internet and human nature to get them off the overhead and still have the benefit of their experience, passion and energy.

The way I see it, the scientists and engineers create the core value. The sales people - the boots on the ground - monetize that value. Everything else is overhead.

Do the hunters and farmers that are sales people perform best in the command and control environment of a channel? It didn't work in the Soviet Union. It doesn't work in a command and control public bureaucracy. Why should it work for a sales channel?

The problem is keeping everyone on the same page. But that is accomplished by culture. Culture grows in small groups. Always did. Always will. Small groups can execute and innovate.

What happens if incentives are realigned to promote instead of constrain the powerful instinct of sales people as they form in passion driven teams. It's clear that the days of the order taker under the cover of the brand are coming to a close. The mantra has been "educating" the customer and the sales force. But that is much too slow and expensive.

Instead of reducing FTE's, repurpose by giving them the choice and some support to become independents. Let them share in the benefits of a growing business and take some of the pain in a hard economy. In the States, make sure they have good health care. Although that may go away once we fix the health care system.

If the versioned newspaper and customized textbooks go mainstream, the problem is going to be boots on the ground. The best boots on the ground are volunteers, not draftees or lifers.

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