Slashing the Soda Pop Budget

At a large electronics development company, one of the branch offices was in the habit of providing free soda pop for the staff. The staff worked long hours with intense deadlines to complete one hardware design project after another. After a cost review, head office sent a directive to stop the free soda, deciding that the cost was unnecessary and was being abused by the staff.

I met with this company for other reasons three years after this had happened, and in discussion with staff about morale, management, the human resources department, and company policies, people were still very bitter about this unilaterally imposed decision.

The free soda had been a source of pride, a differentiator between this company and other employers in the area. Staff saw it as a nice thing that the company offered them, and it helped a little with accepting the long hours and intensity.

By taking it away, without discussion or consultation, the staff felt disappointed, disrespected and cynical. Heard over and over were variations of "I bust my butt for this comapny. I work long hours and they don't pay overtime. They're worried about the costs of a couple of sodas when I've been giving them my heart and soul!? Well, no more."

Management of the day had been happy with the short term cost savings and patted themselves on the back for their budget success. Needless to say, the losses due to damaged morale, that were still pervasive three years later, were much greater than the savings from stopping the free soda. The losses were unmeasurable though, and the soda savings were easily measured. So management used what they could measure, and made a very poor decision.