Over the last several weeks at Northstar Ventures we’ve had to trim our costs and hunker down just like so many other companies. It’s been a gut-wrenching process. We’ve trimmed our staff by 35% and it’s not been fun for anyone…but it’s especially painful for those who end up on that chopping block.

As a CEO, the hardest part about making layoff decisions is trying to set aside emotion and make decisions based on performance and quantifiable value. I’ve found that in times like these, it actually becomes quite apparent who on your team is vital and who can be let go without much negative impact to the business.

Whether you are the decision maker about “who stays and who goes” or if you’re worried about ending up on the chopping block…here are some things to consider:

• Top sales people stay. They keep fuel in the engine.
• Unless paid on 100% commission, mediocre sales people who barely or rarely meet quota must go; now.
• Management team members should only stay if their departure would cause the company to falter substantially. Otherwise, it’s time to say goodbye. One big salary can pay a lot of bills.

• In a season of deep financial concern and widespread layoffs, those who remain should also sacrifice. Trim remaining salaries by at least 5%.
• If you almost fired someone in the past, then they should be near the top of the list when considering layoffs. Unless they’ve made a dramatic improvement, they’re gone.
• Marketing assistants (and assistants in general) are targets. Any worthwhile Marketing Manager (or Managers in general) should be able to absorb the tasks of an assistant until the situation improves.
• Employees who have done a good job of pointing out and proving why they are a resource that you can’t do without should survive if at all possible. You want useful fighters in a time like this.
• Employees who are barely noticed are usually barely noticed when you let them go.
• Don’t underestimate creativity. A reduction in time or pay from three people can equal a full headcount reduction. Find out what people are willing to do before making final decisions.

In July, 2007, Inc. Magazine surveyed business owners on the topic of downsizing. I thought some of the results were insightful:

“Who did our respondents fire? Well, it didn’t always pay to be close to the boss: 12% fired their secretaries or assistant.

The most fired department: Sales and Marketing. Other endangered staff members, IT Specialists, Project Managers, and ironically, the Head of Human Resources.”

My friends, this is most definitely a season of change. It’s a season of scarcity and real lives are being affected.

In the end, these times make us stronger and new opportunities are created. In the end, we’ll be better for it.

Until then….Bosses, chop carefully, thoughtfully, creatively, and with compassion.

And to those who are worried about being chopped? Get out there and do everything in your power to drive sales or become a part of the business engine that’s expensive and difficult to replace. Be the transmission.

Check out this great post for more information about this topic:

10 Tips for Downsizing with Grace in Difficult Economic Times

Top 7 Survival Tips to Deal with Downsizing in the New Economy

Today’s guest author Brian Rutledge, is Managing Partner at Search Marketing firm Get Page One, LLC., which he founded in 1998. Get Page One specializes in helping small to medium sized business grow and manage their online presence through organic search engine optimization, social media optimization and paid search marketing campaigns. Based in Austin, Texas, Get Page One helps clients worldwide with holistic internet marketing campaigns focused on sales, brand awareness, and reputation management.

Jeff Chavez Discusses Killer Entrepreneurship

Jeff Chavez runs one of the most successful small business coaching companies in the United States. In addition to his duties as CEO of Northstar Ventures, he’s active in the professional speaking industry.  At his latest event in Austin, which also featured his friend Tito Beveridge, Jeff discussed the 11 Killer Instinct of Entrepreneurship, a topic which had the audience deeply engaged.  There was so much feedback from the event that Jeff is now writing a book entitled, The 11 Killer Instincts of Entrepreneurship.

Jeff Chavez: Serial Entrepreneur

As founder and CEO of Northstar Ventures, Jeff is able to apply the lessons that he has learned while starting each business, whether successful or not.  He explains in his blog that some of the best lessons he’s learned was from failure, and not from the success some of his companies realized. With each failure, he grew stronger, and was able to pick up the pieces and move in a new direction; with more resolve, experience and commitment to making his next business more successful.

Jeff Chavez began his entrepreneurial career in 1992, as the Founder of Foothill Fire Safety Co. He continued to manage FFSC while forming a second company, Home Healthcare Direct, which distributed medical supplies to assisted living facilities. Both companies were successfully acquired in 1997.

From 1999 to 2002, Jeff Chavez served as Co-Founder, Chairman, and CEO of DispenseSource, Inc. (now Nexiant, Inc.) where he established it as one of the leading providers of automated inventory systems within the industrial and manufacturing industries. The company has emerged as the world’s leading provider of automated inventory systems.

Jeff Chavez Launches Northstar Thinktank

Northstar Thinktank is the newest edition to his business repertoire. Acting as a resource center for entrepreneurs, his team of researchers scour the internet, magazines, books, newspapers, and blogs searching for the most relevant insight that any small business owner would appreciate.  Updated nearly daily, this concept allows for professionals to select any helpful tip which is divided into the three categories of the business cycle: research and planning, marketing and sales, and growth and execution.  This site is especially helpful to those just starting their entrepreneurial journey.

Jeff Chavez: Expert Business Coach

Jeff Chavez is also writing another book called Survive-olution: How successful companies survive and thrive through innovation and evolution. The book focuses on how the success of business hinges on the ability to be flexible and change as needed.  Jeff hopes the book will be published by early 2009, where he will start his book tour and speak on this topic around the country.

Jeff Chavez also appears on The Big Idea with Donny Deutsch as an expert business coach for struggling entrepreneurs. His role requires him to become familiar with each business plan, uncover the problems, and then suggests several ways to improve their concept, brand, finances, and focus.

So much of your ability to succeed in business comes from your passion.

If you don’t have a burning, passionate desire to get your business off the ground, or to take your existing business to the next level, then don’t invest another ounce of effort!

Passion is behind every great success story.

Six years ago my office assistant introduced me to her soft-spoken fiance, Dustin. He was in a local band. They were trying to make it big.

My first glance told me he might be just another dreamy musician.

When I finally saw him actually perform, I was blown away by his passion. It was overwhelming and contagious. I knew immediately that he would go a very long way in the music business.

Over the last 6 years he has traveled the world playing sold out shows to rabid fans over and over again as the lead singer of “Thrice”.

Last night I sat at home and was proud to watch David Letterman introduce my friend Dustin Kensrue as “…an accomplished musician and songwriter”. He did a phenomenal job on Letterman and is climbing the Billboard Charts.

Passion. You’ve gotta have it!

Speaking of passion…The entire Northstar Thinktank team is scouring the world of business information and you’ll want to be one of the first to visit our new Thinktank Business Content Site. This is where we compile relevant, focused resources from the entire world of entrepreneurship.

We’re almost ready to release the new site. All of us are excited and Passionate about it here at the Northstar Thinktank.

You’ll get an update very soon.

Until then, be passionate about your entrepreneurship!

Signup for Northstar Thinktank Newsletter

(Link to Video, “Pistol”)

Check out this great post for more information about this topic:

When Building a Business, Work your Talent