When taking short cuts on your people does not pay
- Phil D'Adamo
- Aug 10
- 1 min read
I understand that business conditions are tough. Costs are rising, margins are under pressure, and every expense is being scrutinised.
But there's one cost-cutting strategy that seldom pays off in the long run: treating people as a cost to be minimised rather than an investment to be developed.
I was reminded of this while reading the linked ABC News investigation into the world's largest cruise company.
The article provides that behind an impressive customer experience were allegations of workers enduring punishing hours, inadequate pay, medical neglect and being forced to eat rotten leftovers.
Closer to home, I've also observed with an aged care service provider looking after my mother that they proudly promote exceptional customer care while failing to show the same care and respect to their own employees, particularly when things go wrong.
Sooner or later, that disconnect catches up with an organisation.
The savings gained from suppressing wages, reducing support or creating poor working conditions are often outweighed by the hidden costs: higher turnover, lower engagement, declining service quality, recruitment challenges, reputational damage and the enormous effort required to rebuild trust.
Leadership literature has long argued that people are an organisation's greatest asset. Yet too many organisations continue to treat them as their most reluctant expense.
I've never quite understood why some organisations work so hard to delight their customers while failing to show the same care and respect to the people who make that customer experience possible.
Look after your people, and they'll look after your customers.
Or does that principle only apply when times are good?
What do you think?
