The cost cutting attitude of global corporations – Three lessons I learnt recently

Confession #3: I hate multinational companies who try to make a deal at the expense of smaller vendors but I am drawn into the cycle of cost cutting through my clients as well.

Recently I held a talk about starting a business in Switzerland. It was a one-hour talk and I was not paid for it. This is a network sponsored by companies. I support their cause. I said yes. We discussed at length that my session would not be about technicalities or process because

1) This depends largely on the type of business you want to set up.

2) Most of this information is freely available online when you know how to use Google.

3) Many of the listeners were not yet sure whether to start a business or seek employment.

So we had agreed that I hold more of a motivational speech, sharing my story of entrepreneurship and my lessons learnt. I mentioned in my presentation that it is important to seek legal advice specific to the personal situation. Still, I got the impression that people were not fully satisfied with the information. What they need is a real business coaching. Only very little companies in Switzerland provide this helpful support for their expats and spouses though. One of my clients does. The expat spouses are very thankful. They are brand ambassadors.

Lesson #1: Support your expat spouses with high quality coaching!

 

In other instances I often get asked for free advice. Sometimes I am happy to “pay it forward” and I have helped many people in a 15 minute chat on Facebook but there is a point where I stop to give free advice. I also noticed that no one ever asked me for my time without paying when I was in a corporate role.

Since I started a business people sometimes behave as if I was unemployed. They think that I am available at random hours during the day (for a coffee at the airport). Many people think that it is fine to ask for my consulting, an article or a talk (without even mentioning payment). I understand that the internet has made free education and training possible but entrepreneurs need to earn an income too and once again I have to say: “Quality has a price!”. In my earlier blog post on “10 Professional Networking Principles” I have given you ideas how you can ensure that you deal sensibly with other people’s time.

If you are also an entrepreneur follow my advice: Only make time for contacts you feel have been appreciative and supportive in the past. Avoid the energy snatchers.

Lesson #2: Quality has a price! 

 

One client cut costs by avoiding all sorts of services (home search, settling-in).  The poor expat has to organize most of the relocation himself. We bend over backwards to find “cheap” workarounds. What happens is that everyone involved in the transfer has a lot more work, more coordination and conversation is needed.

In other areas cost cutting leads to overworked, stressed and long-term disabled staff through under-resourced teams. Considering that many of our clients still pay massive salaries and bonuses to their senior management I really wonder if the new processes, outsourced arrangements and work-arounds really benefit the bottom line.

We need to look into a lot of corporate processes with a fresh eye and from the perspective of our clients, cut out all the admin crap and just focus on delivering an outstanding service.

Lesson #3: Cutting costs at the wrong ends will increase complexity and stress!

 

What’s your take on this?

Please share this post with your cost-cutting corporate friends.

 

 

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