What is an “Employee Bench” and why is it killing your business?

Employees in Australia and beyond, often find themselves “sitting on the bench” in-between projects. The “bench”, in this case, is used to refer to the part of an organisation’s employees that are not actively working on any project for the time being.
Although they may not be actively contributing to the output of the company, employees on the bench still remain on the payroll of their respective organisations and therefore have an impact on cash flow for the business.
A prime example of the bench is in soccer. While there will be eleven players on the field at any point, there are usually about five or six more players, sitting on the bench as substitutes. This set of players are usually brought on as substitutes to replace tired or injured players or those having a bad day.
Similarly, employees on the bench are usually called upon when their contributions are needed to take on new projects.

Why the Employee Bench can be bad for business

There are certainly good things about having a bench. Companies usually leverage this employee bench when the firm is assigned a new task. This ensures there are employees on the ground to see to it that work starts immediately when the customer assigns the task.
However, if your bench is not properly managed, this can put your business in a great deal of risk.

1. Risk of Employee disengagement and turnover – To start with, employees sitting on the bench are not actively contributing to the firm’s output since they are not engaged in productive or revenue-generating tasks. That means they never get enough opportunities to contribute towards organisational goals and objectives nor are they able to maximise their own talents and potential. This places you into a situation which is high risk for losing valuable employees because they don’t feel like they are achieving anything.
2. Risk of Reduced Cash Flow – You still have to pay employees even while they are “sitting on the bench”. While they are not contributing to the firms’ revenue generation and profitability, there are overhead costs associated with keeping a bench. This can be expected to significantly reduce the company’s cash flow without a corresponding return and place significant financial risk on the company.
3. Risk of Employee Boredom and Turnover – The right employees will be wanting to utilise their hard earned skills rather than filling their time with admin or doing menial tasks while they wait for the next project to start. The longer you leave them idle, the more they will become bored and restless and start to look for other ways to progress their career and professional development.
4. Risk of Cultural Damage – The above risks can be infectious among a close team as other staff see co-workers under-utilised and bored and looking for new, exciting opportunities. This can change the culture in your teams and can lead to increased staff turnover and increasingly disgruntled staff who are left on the bench too long.

While burnout and boredom remains a prominent challenge due to the peaks and troughs experienced in most industries, companies are starting to realise that these risks are very real and are impacting their teams and business. In essence, an employee bench can lead to employee turnover. For firms of any size, this can have a direct impact on the bottom line.

Getting your bench to work for you

While it is one thing to keep a bench, making it work for you is an entirely different ball game. But, there is a tried and tested method to make your employee bench work for you, and what is exciting is you have probably used it already in your business to get work done – it is called “borrowing/loaning” Talent.
You could call it secondments, or consulting, or sub-contracting/contracting or for some companies, business as usual. When you boil it down, however, “borrowing” is simply using the employee of another business to get work done in yours. And vice versa, “loaning” is simply contracting your staff member to complete a work package for another business, which at that point is called your customer – see what we did there?
Companies all over Australia have employees sitting on the bench. At the same time, industries are calling out Talent shortages that are causing project delays. Firstly, this highlights a mismatch of supply and demand, but secondly, this highlights your opportunity. But not only opportunity, also increased cash flow.

The benefits of putting your bench to work

I have seen the enormous power of leveraging the “borrow/loan” strategy first hand. I have seen businesses who were in danger of losing half their workforce and closing, to within a month, significantly increasing the size of the company and eventually doubling the size of their team to keep up with demand from other businesses for their support.
It is a two-way swing on your financial situation because you not only cut your overheads, but you also increase your revenue, exponentially increasing your success.
Benefits of using this strategy are man, they include:

• Job stability – Invest in your staff for the long term and build the highest performing teams for your business by providing job stability to your valued employees.
• Agile workforce – Give yourself the agility of the gig economy but coupled with full-time employment to give your business the best workforce flexibility at the lowest cost to the business.
• Employee loyalty – Your employees will reward you with increased loyalty to the company when they see that the business sees them as a vital part of the team that it doesn’t want to lose. This will cascade through your team culture.
• Improved company financials – As mentioned, take advantage of decreased overheads and increased revenue to propel your strategy and growth.
• Improved business development – Working with more businesses, increasing your network and building your brand awareness will lead to additional work down the line.
• Professional development – Give your employees a change of scenery so they don’t become stale and unmotivated while simultaneously exposing them to new business models and industries to increase their understanding of how industry works.

And many more!

How to get started

You have a valuable resource to support you in getting started – your business network! Give your partners/clients/suppliers a call and let them know you have spare capacity to support their projects if they require it. You will be surprised how many will realise they have a body of work that needs to get done, but they just didn’t think to call you. Opportunities abound but you will need to find them.
Some quick tips to get you started:

1. Research “borrow/loan” to learn how other companies are doing it and what systems they use. This blog is a good starting point but you will find more on social media.
2. Review your sub-contract templates to ensure you have the mechanisms in place to act quickly when an opportunity presents itself.
3. Review your employee agreements to ensure that you are able to contract your staff to other organisations for the purposes of completing requested tasks.
4. Talk to your employees to get their buy-in. This is essential to making this work in your favour. Ensure you position the discussion as a means of keeping your team together while providing new and exciting professional development opportunities.
5. Register your business on B2B platforms that can connect you to Talent and contracts, such as www.benchon.com.

Conclusion

As it turns out, an employee bench may offer a competitive advantage but can also pose certain challenges to businesses. This can lead to increased employee turnover, poor team culture and decreased financial performance.
However, if properly managed, businesses may be able to turn this tricky situation around to their own advantage. Using the “borrow/loan” strategy, businesses can not only increase their revenue, employee engagement and retention, but you can also find the best, hidden Talent from other companies to support you when you really need it.
Good luck!
Cover image: Shutterstock

This article is contributed by BenchOn.