Before making a tough decision that impacts your team’s future, Gravity Payments CEO Dan Price has a simple suggestion: Ask them for advice. It worked for him.
The year 2020 was rocky. Millions of people were laid off or furloughed. The pain may continue into the near-term future — but even once our lives stabilize, this won’t be the only time an economy stumbles. Companies will again face this choice: Eliminate a great team that’ll be difficult to rebuild, or somehow absorb massive financial losses.
Dan Price says there’s a third way, and he proved it out this year. The solution, he says, is to act as a team. “Your team is so much smarter than you,” Price says. “Mine is. Give power to your people, be honest and democratic. They will find solutions that you can’t see.”
Price made waves in 2015 when he took a million-dollar pay cut to institute a $70,000 minimum wage for his employees, so he isn’t the kind of boss who is quick to do layoffs. But he was feeling pressure this year. His company, Gravity Payments, processes credit card payments for more than 20,000 small businesses — and as their revenue disappeared at the onset of the pandemic, so did Price’s. “We were losing $1.5 million a month,” he says. “We had three months before we’d be out of business.”
He explained this to his team of 200, and they offered a solution: Instead of layoffs, let them anonymously volunteer for pay cuts. “I thought it was crazy,” Price says. “I figured we’d waste a week’s worth of time to learn it wouldn’t work.”
He was wrong…