The decision to downsize a company

This case was adapted from an actual case known to the authors. With its positive reputation, Newell has been able to select new employees from a large pool of job applicants.

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What other options can you consider? The letter should state their position has been eliminated and then outlines important information such: It may behoove company ownership to sharpen the focus of the company by eliminating some of the products or services that it offers.

The racial composition of the company has been predominately Caucasian, for two reasons. Downsizing is typically done in cases where the company is making significant changes to either increase company value or eliminate excess costs.

Future demand for company products was projected to be moderate for, and Have a car service available for someone who came to work by public transportation but is exceptionally distraught upon hearing the news. This may seem counterintuitive on the surface, but some instances exist where this would be advantageous.

Making Layoff Decisions

They then had three weeks set aside for one-on-one career counseling, again on site, offered to all employees. If you disproportionately lay off a specific class of people, you are asking for a lawsuit. The company operates two plants—one in Atlanta, Georgia, and the other in Norwood, California.

Causes of Employee Downsizing

They may be angry come Monday morning. One cornerstone of HR policy has been to use the principle of seniority when training, assigning, transferring, and promoting employees. It is noteworthy that Newell welcomed the opportunity to rapidly increase the diversity of its workforce for both business and ethical reasons.

Hey, everything must be going to be okay or they would have ducked out the back door by now. This helps the morale of the remaining employees and can reduce the risk of wrongful termination lawsuits.

Newell is regarded as an excellent place to work by its employees and within the surrounding communities. If after a downsizing employees see the top leaders still in their offices, with the doors open, and out walking around, they come to the conclusion: Newell Corporation believes that a work environment that reflects a diverse workforce, values diversity, and honors the worth of its employees benefits the company, its customers, and its employees.

These overburdened and burned out employees will bolt as soon as better job opportunities become available. Employee morale and loyalty have always been high, and job satisfaction studies conducted by the company consistently rate the organization as a fair and equitable place to work. In doing so, a decrease in the number of employees may be necessary.

That could mean calling around within your network to see if anyone is hiring, providing great job recommendations or even, gasp, calling up your competitors to see if they have any openings. If you are forced to let employees go that have several years with your company, then you lose people with intimate experience of past decisions and how those decisions affected company productivity and profitability.

However, since approximatelythe demographic characteristics of the local labor market have changed dramatically to include more Hispanics, African Americans, and Asian Americans.

If you tell people Friday afternoon, you can bet your employees will be on the phone all weekend. Productivity Companies sometimes downsize their employee base to increase productivity. Do you really have to lay off employees to remain profitable? Laid off employees should not be escorted off the property like criminals.

Here are seven ways to inject downsizing ethics into your layoff process. Obviously, most business owners—especially entrepreneurs—never want to let anyone go, especially in a mass layoff. The integration of minorities into the Norwood facility was seamless and without racial tension.

Sure, these employees still have jobs, but who is going to do the work of the laid off employees? Do your homework before downsizing.After more than two decades of research into corporate downsizing, there remains a fundamental question: “How can managers and employees rethink their organizations even as they confront the need to downsize?” More specifically, how can organizations support learning, innovation and creativity while at the same time finding effective ways.

Which employees should your company lay off? Though making the decision to let someone go is rarely easy, this article can help you feel confident you've made the best of a bad situation. Establish the criteria for layoff decisions.

Advantages and Disadvantages of Downsizing a Company

Once you have a sense of what skills the company will need going forward, you can decide how to select. Newell’s Decision to Downsize: An Ethical Dilemma. A particular issue in business ethics is: “What exactly does the term ethics mean?” Various writers have described ethics as rules that govern behavior, desired societal values such as respect for justice, or accepted principles of right or wrong.

Of course, many companies were also conducting layoffs around the same time, but it's how Hsieh went about announcing his decision to cut jobs that set he and his company apart. Sure, it would be nice if you pay out a sum of money and/or benefits, but your company's financial position, and to some degree your generosity, play a big role in your decision.

Business owners typically make the decision to downsize with much deliberation. Downsizing is typically done in cases where the company is making significant changes to either increase company.

Downsizing and Ethics-Ethical Downsizing Download
The decision to downsize a company
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