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Right Sizing in Good Times – Jordan-Sitter Associates

Right Sizing in Good Times

By Jerry Randecker and Chris Sitter


We recently re-read with interest an article titled “Right Sizing in Challenging Times” which was written by Jordan-Sitter Associates and published in the November 2008 Construction Equipment Distribution magazine. By that time it was being widely reported that difficult economic times were ahead and the article offered ideas to consider for adjusting the size of your dealership to weather the economic storm.

Although the economic environment is still on a bit of a roller coaster, the future is much brighter than it was in 2008. However, “right sizing” remains a challenge since the current, more positive, economic conditions bring new challenges for AED dealers to face. So let’s review some important issues that you should reflect on as you plan for future growth.

Retaining Top Talent – In a recent survey 34% of human resource managers reported increased turnover of their organization’s top talent in 2011. In 2012 43% report a fear that the trend will continue. With the job market improving your most talented employees become more confident about their ability to find other, potentially better, jobs. Let’s face it, there are more opportunities available to consider therefore the risk is increasing that they will be looking for career advancement options.

The solution to retain your best employees is easy to imagine but difficult to implement and is one your company should be practicing in both strong and tough economic times. When candidates are evaluating a potential new employer they look for financial stability, employee longevity, and a positive work culture. They also seek opportunities which allow a broader level of authority to make necessary decisions or that offer promotion opportunities beyond the position they are hired into.

Never assume it is too late to start paying attention to the above concepts. Everyone knows the past few years have been tough. Your top managers stayed with you for a reason so give them good reasons to want to continue their career with your dealership.

Providing Competitive Compensation – This is always a factor in an employee’s decision to stay or look for alternative employment options. It is also important to employees you are trying to recruit.

The fact is you can only offer what you can afford so don’t forget that compensation is so much more than the base salary. 64% of employees say job advancement opportunities are more important than compensation and benefits. Promoting your existing top talent is the ideal way to retain good people and also demonstrate to potential candidates the type of environment and culture they can become a part of.

Is your organization chart ideal for 2012? We asked the same question in 2009 for a different reason. Then your organization was probably shrinking in size and changes were necessary to “down size” your management infrastructure. 2012 marks the return of significant sales growth for many dealers and, once again, “right sizing” is required but this time it is “up sizing”. Here are some tips offered back in 2009 that still apply today…for the opposite reason:

  •  Be courageous and develop a brand new organization chart focused on where you want to go, and not on what you have always done. Don’t just pull out the one you had in 2007-2008, give serious consideration to your present and future goals.
  • Develop position descriptions for each key role. Please don’t just outline the role to match your existing employees, rather describe the roles you need to obtain the level of success you envision.
  • Fill in the organization chart with members of your current Team to match your needs with their strengths. Don’t be afraid to “re-shuffle the deck” again, but you must share your vision with your Team to gain their support. You must also include a training plan to allow managers to develop the leadership skills your organization requires.
  • Remember the old adage “A bird in the hand is worth two in the bush” applies to this exercise. Existing employees offer you a wealth of knowledge and insight into your customers, products, and markets. It is almost always better to provide them opportunities to grow before seeking to replace them with someone who does not have the internal history of your company.

Whether economic conditions are tough or improving, communication is always important. Keep your employees informed as changes are planned and implemented. If handled properly they will be encouraged to know your organization is building for the future.

Everyone reading this article has dealt with some level of adversity during the past few years. You know your profit drivers and success factors as well as you know your markets and your customers. We hope you consider the above ideas as additional tools to help keep your company strong for the long haul.