Hourly Paid Team Members
Hourly paid staff are still often paid a month in areas for the work they've done. That means that their actual pay can vary quite a bit with varying numbers of weekends and public holidays. However many of their expenses: school fees, utility bills etc. can remain quite constant.
This situation can very easily get tricky for these team members...and we have seen a rise in "payday" loan companies.
Healthy bodies (and living things in general) rely on healthy circulation. Blockages anywhere are not good. Circulation is critical for companies too. Especially in the area of cash.
To improve something (in fact practically anything) we need to measure it as often as practically possible. Things happen and if we don't inspect something frequently enough we could be faced with a disaster.
(This post was adapted from a session from Conscious Capitalism
See see a link to the full talk below).
A Fair Day's Work for a Fair Day's Pay...
(In other words, helping the team, keeping the company healthy, and scaling effectively).
Why not pay hourly staff each day?
Indeed the phrase, "a fair day's work for a fair day's pay" has been with us for over two thousand years when it was important to pay workers before sunset. And if we don't, it must be considered that we're scaling our companies on cash loaned us by our staff!
(Aside: If you're already thinking - "gee that sounds like a lot of work...", stay tuned...)
Here are just some of the benefits...
Hourly-paid staff can budget more effectively and they'll always know how much they're getting.
There's less likelihood of needing very expensive "bridging" facilities
Circulation and flow is healthier and allows companies to have very a much more accurate picture of their cash position to allow adjustments to be made well in advance of any potential problems.
Better accountability with cash...unfortunately it's surprising what otherwise rational people can do when cash accumulates in one place even for short periods!
Measurement of growth is much more accurate. We're able to measure cash positions much more frequently and understand if we're improving profitability.
Staff are happier...and we all know the effect of happy players!
More Admin Work?
Well, a little initially, but not much. If we were talking about this 20 - 25 years ago then I'd agree we'd need a lot more hours and more people to make this happen. Now, though, technology exists to collect hours worked and have payments made daily and accounted for.
But Wait... I hear you say.
That's all well and good for the cash going out, but how about cash coming in?
I would say it's good practice to explore ways to invoice customers more frequently so the flow of cash is improved. It may not be possible with all customers, but if we're creative and truly partner with our customers, it may be possible in more ways than we might think.
With all changes like this, the main obstacle is our mindset and how we think about cash, it's movement through the business, our business model and the contribution and wellbeing of our precious team members. If we can make a - small - adjustment in our approach we can can reap substantial benefit.
Food for thought? I hope so...
My very best and keep Scaling.
== > Link to full segment in Conscious Capitalism < ==
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