The cost of doing business

Photo by Jess Loiterton.

Our office is in an historic district. We work amidst buses full of tourists. Some come from other parts of Canada. Some make their way here by flying across oceans. They wander around. They shop. They eat. And they take pictures. So. Many. Pictures.

They all use the same backdrop. There's a tall brick building covered in climbing ivy across the street from our office. Years ago, we thought about putting up signs in the window. "Congrats on your engagement!" or "Your new album cover looks rad!" But because it's a tourist district, we're not actually allowed to put anything up in the front-facing windows.

Despite the lovely scenery, the restaurants here are only so-so. It can be hard to dodge the tourist-friendly menus. So when a small ice cream shop near us closed, we were curious what would take its place.

After several months idle, an 8.5x11 piece of paper showed up one day, taped to the front door. It had a picture of a piece of pizza. Cool, it gives us a kid-friendly option if we need one. But days went by. And then weeks. And they still hadn't opened.

A new 8.5x11 sign appeared. "Closed due to staffing."

At this point, we've got more questions than answers. What does "due to staffing" mean, exactly?

Two days later, another sign. "Closed. Now hiring a cook. Apply on website."

It's been about 4 months. The sign is still up. The restaurant is still closed.

Last month, we noticed new signs. Not on the shuttered pizza joint, but in front of other restaurants nearby. They were hiring, and wanted you to know it was at new, higher wages. They posted the salary ranges. The top end is just above Toronto's living wage. They also advertised signing bonuses.

We don't know if they're having more luck getting folks in but we do know that the holidays are coming. Many of the businesses here make their entire year on the backs of their November/December sales. And between staying closed or paying more for the staff they need to stay open, well, they posted their choice on the sandwich board out front.

This is the cost of doing business in late 2021. And this isn't specific to our small tourist haven here in Toronto. It's happening all over the place.

Who pays?

Every organization has costs, but there’s a lot of power in how they’re labelled. The labels people use bake in assumptions about whether those costs are internal or external. They tell you who we think should pay those costs.

"No one wants to work anymore" is one way to talk about it. "We have built a workplace and an industry on bullying and overwork and low wages" is another.

"The pandemic has us experiencing record turnover" is one way to label a cost. But for many orgs, "we're burning our people out at record rates" describes the same thing. Same cost, but clearer about who's paying.

As a boss, some of this re-labelling will be uncomfortable and it's worth thinking that through. When businesses talk about these costs in the abstract, it's not personal. You might not like the experience of running your organization through a talent shortgage. But ultimately, 🤷 whaddyagonnado, right?

When we refocus on the experience of the people in your organization, it can feel personal in a hurry. It feels personal to hear that your organization's problems might be rooted in your own practices, instead of the supply chain.

Making it concrete though, even when it's uncomfortable, is a gift. It's a gift because calling it what it is gives you something to do about it.

Who should pay?

When we all got sent home last year, there were costs. Internet, desk chairs, headsets, ring lights. Mental health, physical health, children's health. Many of the companies we work with set up ergonomics budgets for home offices early in pandemic. Or extra health benefits. Or new flex time policies for parents.

They did those things because they saw the costs coming, and chose to have the company pay them instead of putting it on their team. That's a smart move. By the time you calculate their reduced snack budget, office rent, and wear and tear on the espresso machine, they might have broken even financially. But even if they didn't, it was cheap money to spend.

If you look around, you'll find dozens of examples of this. Places where your company chooses to pick up a cost so that employees don't have to. And places where you don't. Where you implicitly expect your employees to carry a cost that belongs to the business. Find those. Understand those. Learn how to smell them in an organization.

We talked with a boss last week whose company was going through a benefits overhaul. Totally new packages, maybe a genuine improvement for everyone involved. But with a lot to navigate and a tight window to make decisions. And he saw it – that the cost of this change was one his employees would carry. As stress, as anxiety, as another fucking thing.

He's not the CEO. He can't materially change the decision to switch plans, or the timelines of the insurance company. He could have punted. Probably it's not something people would quit over, right? And even if someone did, he could have shrugged and mumbled something about the great resignation. Whaddyagonnado, right?

Instead, he gave his team time to work it through. Paid time, without hitting their PTO. He worked with each team member to make room for them to call doctors and pharmacies, to compare plans, and figure out the implications for their family. And then he talked to other managers in the company about doing the same.

That's all. Spot the costs. Figure out who should be paying. There are genuine costs to doing business, we're not pretending there aren't. We just want you to be intentional about which ones go on the corporate card. And if you get stuck, it may help to imagine your own sandwich board. If you were trying to catch the eye of a workforce eager to renegotiate some of the longest standing assumptions about work, what would you put up there?

- Melissa and Johnathan