Managing People;

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Businesses with uneven workloads often run the risk of overstaffing, getting through crunch periods by carrying too many full-time employees. One solution is "peak-time pay," essentially a premium wage for regular part-time employees who work during periods when the full-time staff is overburdened. Companies can usually afford the higher wage because they don't have to provide part-timers with benefits, notes Stuart J. Mahlin, the Cincinnati consultant who developed the concept. And the money helps attract better-qualified, more dependable workers.

That, at any rate, is what happened at United American Bank of Memphis. "We had people overworked in some areas and underworked in others," says Morgan Brookfield, executive vice-president. "Morale was bad, and tellers were making a lot of errors." Using peak-time pay, the bank reduced its full-time staff from 113 to 95 people and added 19 peak-time employees, while holding its payroll steady. As a result, it now spends less than its competitors on personnel, whereas before it spent more.

"The bank has grown and is more profitable," says Brookfield. "We're improved morale, lowered error rates and absenteeism, and enhanced our work force, without spending money."