Top-Heavy

During the economic downturn, you gave employees promotions to keep them around in lieu of the raises you couldn't afford. Now you have an overabundance of managers negatively affecting morale, because either you don't have enough work to go around, or some employees have to report to too many "chiefs."

If you've got too many managers, you need to face the hard facts-if you're not planning to ramp back up and use these people's skills, it's better to let them go, says Cynthia Shapiro, an HR consultant in Sammamish, Washington. You could also try offering your managers a part-time schedule or a few months of unpaid leave-they might appreciate the time off to recharge their batteries, says Shapiro.

If, on the other hand, you will vitally need this person when you expand in six months, you can build employee morale in the meantime. "What you want to create is an all-hands-on-deck mentality," says Shapiro. This means putting everyone from top management down to recent hires in the trenches. Even if seasoned managers haven't worked the retail floor for a while, it can be a time for them to renew their skills, while building morale among lower-level employees. "Employees and managers get to know each other better and respect each other's skills."

Content Continues Below

Realize that if one employee has to report to three managers, it will be counterproductive. If managers A, B and C need to have input over one employee, designate manager A to deal with the employee. If any issues need to be resolved by the other two-they go to manager A and discuss them, and only that one person passes the issues on to the employee.

Above all, communicate with all your employees. Be clear on why a manager needs to stay around, and enlist the help of employees to find solutions to the current financial crisis.