Protecting financial assets has led to massive layoffs, reductions in compensation, credit freezes, and attendant loss of business, which in turn risks seriously demoralizing and drastically underutilizing employees.

Executives may believe this risk is acceptable, because they believe their employees will hang in there for the duration as options dwindle. However, executives should be as focused on protecting their human assets as they are on protecting their financial assets.

Once the consequences of demoralizing employees become clear, it will be too late to prevent them. As the inevitable recovery begins, many sectors will grow quickly and will need employees with the same skill set as those filling the sales, product, marketing, finance, operations, IT, human resources, and procurement functions vital to a well-run bank. The best of those employees — the very ones the banking industry will need to propel its recovery — will be targeted not only by rival banks, but also by other sectors.

Executives should use this crisis as an opportunity to engage employees by thinking inside the box. Every company is a box, and inside are thousands of employees who are thinking every day about ideas for improving what they do but are frustrated that their managers never hear most of these ideas.

Here are three reasons good companies will tap into these ideas now.

First, our experience shows that employees desperately want to help their company thrive. They have thousands of good ideas for reducing costs by simplifying work and increasing revenue by tweaking pricing, adding markets, or taking myriad other actions. Those closest to the customer and closest to the work see ways to improve the customer experience. Those in operations see wasted steps, and those in finance see reports that are prepared but never read.

Giving employees a process for increasing efficiency, and top-line growth, can significantly improve morale and loyalty and foster a culture of collaboration.

Second, personnel costs, typically 60%-70% of a bank's expenses, will have to be reduced in light of revenue losses. Though it is counterintuitive, many banking companies, as well as those in other industries, have shown they can engage employees in recommending good ideas for reducing personnel costs.

By engaging them in making these hard decisions, executives generate enormous good will and credibility as everyone in the company builds consensus around the actions that must be taken. Treating employees as business partners in facing tough times has enormous payoff during the recovery.

Third, engaging employees reveals the great bench strength that all large companies have. Too often, talent is hidden in silos. By engaging employees effectively, executives can collectively identify many talented, if sometimes junior, managers in a corporate talent pool.

As organizations become stretched by the need to do more with less, having very talented people assume new roles can invigorate and lead to success. Perhaps most importantly, it tells talented individuals that even during tough times, there can be good career paths.

Today, as bank stocks plummet to dangerous levels, executives face the worst crisis of their business careers. However, the small team at the top needs to recognize that there are thousands of employees who can work side by side with them to survive and thrive. Banks can have the best cost and fee structures heading into the recovery by involving employees now in identifying and making significant changes — many of which can be accomplished in 6 to 12 months.

Bank executives should be creating their own "Human Asset Relief Program" for frustrated employees who are very troubled by the state of their company but are not being given an opportunity to help.

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