beautiful  girlIf you had to rate your boss today on how well they make decisions in the best interest of the company, consumer and employee, what would be their score on a scale of 1-10? Independent of our economic situation, management may be making decisions that are short sighted; there is too much emphasis on immediate cost savings. Unfortunately, as those same decisions play out over time, management’s intentions to save money actually end up costing us all more.

Take this example from a contractor who works in the nuclear power plant industry. A plant will schedule a planned outage for maintenance every year or two years. During this time, depending on the level of preventative maintenance, the employment for the company swells with additional outside contractors to expedite the job getting done; reducing downtime. The contractors range from skilled trades to planners – basically anyone who supports the project. Typically, a shutdown can run anywhere from 30-60 days. During this time, the plant has to 1) pay for regular employees and contractors and 2) purchase alternative electricity to keep their customers “in the light”.

Management in their wisdom decides to forgo working through the Easter holiday. The company is approaching the project end date at month’s end. Many of the skilled contractors are union workers or have contracts with more lucrative pay tied to working holidays. It seems like a good decision, let’s save some money and make a stronger push when they return from the three day weekend.

The contractor shakes his head. He’s seen this before in other plants. His prediction is that many of the skilled tradesmen will not return after the holiday. Why should they? Many of them have traveled between states to come to work on this project and the likelihood they will remain in a hotel over a holiday weekend is bleak. Once home, they have plenty of time to reflect on their choices. Do I return for a couple of weeks to finish up this project with a company who avoids paying double or triple time pay or do I lock and load myself into the next longer term job. It seems like an easy decision for a high demand skill set in this industry.

After the holiday weekend, to no surprise, the returning workforce was much lighter. Management has already pushed out the completion date beyond the project deadline. They have lost economies of scale with a cohesive work group, will likely struggle with resource allocation and must purchase more electricity to supply to their customers. A bit short sighted for all parties, if you ask me.