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How To Deal With Budget Cuts Gracefully
Very often, working in a corporation communications department has it’s advantages. After all, you get to do what you love in the creative sense and have the benefit of a strong brand, resources and financial stability.
There are also challenges, budget cuts being the most common.
When the fiscal ax strikes, it’s human nature to be frustrated. It is also an opportunity to ask the questions needed to ensure you are staying ahead of the ax:
-Does my team have SLAs similar to an agency would have?
-Do we have comparable pricing supported by market research?
-Are we helping to save the firm money, increase revenue or impact productivity and communications?
-Are we able to quantify our impact to the firm?
Creative’s are not always comfortable standing on their own soap boxes or evangelizing a recent win, but we should; we are after all a business function with tangible results for our work. Unless that work is quantified and the business impact communicated, there will always be a high risk of outsourcing or cutting budgets of creative teams. Nevertheless, the prospect of budget cuts is a necessary evil in the business world, so it’s better to react with a modicum of grace and an unwavering determination to do more with less.
Trim the Fat
The most obvious response to budget cuts is to curtail or eliminate the non-essential expenses, especially those which are the most visible.
Since perception is often more persuasive than reality, it may behoove you to bite the bullet and jettison some of the more opulent departmental perks like frequent catered lunches or in-house video game tournaments. Though these line items might not amount to a huge part of your budget, eliminating them will demonstrate to your interdepartmental colleagues that you’re willing to make sacrifices to benefit the greater good.
Capture Cost Avoidance
Many communication leaders are already operating at reduced budget cuts and have been through these exercises many times over the past few years. One great way to defend the work your team does, and the daily budget saving things you do is to capture the cost avoidance. When presented in combination with market rates, savings and measures in place to increase productivity, exposure, or revenue – cost avoidance can be a great way of sharing your impact, and minimizing potential cuts.
Interns and Outsourcing
Another way to accomplish more with your current staff is to assign more tasks to in-house interns or external contractors. This will free up your full-time employees to allocate their time and talents to more complex projects.
If your department doesn’t already use interns… what are you waiting for? It’s an opportunity to take on an energetic, eager individual who wants to gain valuable experience at little or no cost to the company.
By the same token, outsourcing repetitive, cumbersome work can accomplish the same thing. And if you can finish a typical marketing video in three days instead of four by farming out writing an internal newsletter or editing blogs, then it might be worth it.
Limit Travel Costs
Travel is a huge line item on most budgets. Limiting travel expenses for your video crews by hiring personnel who are based near your shooting location to handle the footage collection on non-local projects.
Carry Out Competitive Benchmarking in Like-Size Organizations
Competitive benchmarking is the practice of comparing your department’s processes and performance metrics to those of similar companies. Many teams are already doing this in comparison to outsourcing or agency rates. What are your competitor’s corporate communications and video budgets?
If you can investigate how money is spent at other corporate communications units within comparable companies, then you can figure out where you may be overspending (or underspending) your budget. This information is can be integral in defending your budget or asking for an increase in certain areas.
Protect Your Unit From Future Cuts
Once you’ve mapped out a strategy to deal with budget cuts, it’s essential to take measures to minimize the odds of being targeted for additional belt-tightening actions in the future. Some suggestions include:
Make a list of all of the end products generated by the corporate communications team for a given time period. Describe how each project helped the company accomplish its objectives, and if possible estimate or compute its return on investment.
Hold periodic meetings (perhaps quarterly) with management and other department heads to increase familiarity with your unit and encourage communication and feedback with other divisions. Not only does this give you an opportunity to highlight the value of your team, but it also lowers the chances that someone will cut your future budget due to ignorance surrounding your overall function.
Make solid plans for the future. Outline your project objectives for the coming year, but also list your long-term goals—especially those which are linked to funding. This will make it easier to upgrade equipment and keep pace with technology without having to beg for more money just to keep up with everyone else.
Putting in the effort to organize your resources and document costs will help your department—and the company as a whole—in the long run.
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