Finance directors are obviously under a lot of pressure to cut costs at the moment. With revenues down across the board, most companies have been looking to trim some unnecessary fat to boost the bottom line. And for some FDs, this includes your benefits package. According to a new survey by fleet management company Lloyds TSB Autolease, 23% of finance heads want to scrap any and every corporate perk, from company cars to health insurance. We suppose it beats making more people redundant – but it might not make your staff feel terribly positive about the company if all their benefits are suddenly withdrawn...
Company cars were cited most regularly as the best area to cut, which as you’d imagine, Autolease is not very happy about. ‘The perceived value of a company car is often higher than the hard cash value, so it remains a great option for business and staff alike,’ huffs the in-no-way biased fleet manager. But pretty much everything seems to be up for grabs, as far as FDs are concerned – others want to put a stop to bonuses and other performance-related pay; others want to stop funding leisure activities like gym memberships; and some are even keen to chop health insurance, childcare and pensions (which is brave, to say the least).
There are two questions here. The first is whether companies ought to be funding benefits like these in such difficult economic times. And although the direct benefit may be hard to quantify in some cases, the answer is rarely straightforward. Take corporate gym memberships, for instance; they may seem a bit ‘nice-to-have’ on the face of it, but it’s probably also the best way of ensuring that you have a healthy workforce – which means staff will be more productive in the office and take less time off sick. That’s pretty handy at the moment.
And from a purely pragmatic point of view, removing benefits that people already have is not exactly a recipe for great office morale. As Autolease points out, having a well-motivated workforce is essential for any company trying to drag itself out of a downturn, and this seems like a pretty good way to get up people’s noses. A better solution will invariably be to try and make your scheme less expensive by finding cheaper variants of existing benefits – and we suspect that any FDs with pretensions of moving into the top job (as several have done lately) will be diplomatic enough to recognise that...
In today's bulletin:
Summer sucker Punch
Persimmon boost as housing market recovery continues
Stricken bankers-turned-entrepreneurs rescue Regus?
Managing a recruitment business through the recession
FDs want to scrap your perks