The current business climate in the United States is challenging at best. We’re facing a perfect storm of soaring oil prices, bank failures and consumers with too many needs and too few dollars. Businesses face the balancing act of trying to maintain a healthy bottom line while cutting costs and reducing staff.

But cutting costs and reducing staff without adequate planning can damage customer satisfaction and destroy employee motivation to provide great service.

The airline industry provides a prime example of some of the results of the perfect storm.

The rising cost of fuel and fierce competition for fliers has forced airlines to search for pennies to save on every passenger. With the advent of some new fees, every passenger should receive an a’la carte menu when a flight is booked.

Want to book your flight by phone? That will be $20. Want to do it in person at the airport? That’s $40. Hungry? That will be $6, exact change only.

It is no surprise that J.D. Power and Associates found in a 2008 study that overall satisfaction with the airline industry is at the lowest level in three years.

The survey revealed satisfaction with "people" factors, such as knowledge, courtesy and helpfulness, has declined dramatically since 2007.

"Across the airline experience, from check-in, to the flight, to deplaning, passengers are being affected by the ramifications of carriers making staff cutbacks and have expressed that performance and attitudes of airline staff are suffering," said Sam Thanawalla, director of the global hospitality and travel practice at J.D. Power.

Imagine the pressure on a flight attendant to provide a great experience while charging for items that until recently had been considered amenities?

The ability of staff to provide great service diminishes as the volume of difficult customers increases and the number of staff to handle these customers decreases.

Among airlines, cost cutting policies are creating challenging situations that demoralize customer service representatives.

Cost-saving measures are issued as directives from the executive office and may have a far-reaching negative impact. These directives can make working conditions on the frontline miserable and crush employee morale. A top-down approach creates fearful employees who focus on protecting themselves, not on moving the organization through difficult times.

To avoid annoying customers, businesses must balance the need to trim expenses, while minimizing the impact to customers and service staff. This effort does not require a swarm of outside consultants. The best consultants are on the frontline.

IKEA and Amazon make thrift a central part of their business and a point of pride for employees. In these companies, employees are engaged in the hunt to reduce costs.

When it comes to expenses, these frontline employees have firsthand knowledge of company inefficiencies and will know where money is being wasted. In addition, these employees will have a unique perspective on the impact of cost reductions on the customer.

Employee involvement in cost reductions should begin by isolating the source of the costs.

Discuss the following:

1. How can we reduce these costs?

2. How will the cost reduction impact the customer experience?

3. How will the cost reduction impact the customer service representative experience?

Raises and bonuses may not be available in current economic conditions; however, it is critical that staff sacrifices and contributions are recognized and appreciated.

Contact Leslie Clark, president of Shift, through her website www.shiftcustomerservice.com or (520) 971-0456. Shift provides training and consulting services for businesses working to provide distinctive customer service by collecting information, developing processes and training people. Customer Focus appears the fourth week of each month in Inside Tucson Business.