[quote=Shamou;79538]Here is a hypothetical scenario:
You work for a privately owned company and discover a way that the same amount of production can be done with half the manpower. You talk about this to the owner and he tells you that if you implement your technology… he will make you a full partner… which means a huge financial reward for you.
However, if you do it, you know that half of your friends and co-workers will lose their job and that since most of these people have been there for over twenty years…
What do you do…??? Forge ahead and reap the reward… or squelch your project… and save your friends and co-workers… (No other option is available)
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Interesting hypothetical scenario you have here Shamou.
First, I would of course move ahead with the new technology
after inspecting the books and negotiating carefully just what powers and liabilities I would be taking on as full partner. Oh, and if I didn't like what I saw I'd see if I could sell the idea elsewhere.
Second, there are never just two options in life, especially in business. I'd consider myself a pretty poor businesswoman if an either/or solution such as this was the best I or my staff could come up with! In the short term (provided the technology turnaround needed to happen quickly I'd cut all staff to 20 hrs with same pay and benefits secure for a predetermined time period) while simultaneously conducting reviews of all employees and laying off those are not productive. During this time I’d be figuring out how to get the remaining employees engaged in a profitable enterprise with the assumption they’d be highly motivated to help management figure out just what the said profitable enterprise would be…
PS. I know this can be done successfully because I’ve done it before.
And while I might not fit in at Harvard I do fit in in life...
[quote=JohnPlace;79608]If your company can get the same amount of work done with half the people, you owe it to your stockholders to make cuts.
However, there is flip side here. Human beings are usually a company's most important and most expensive resource. The cost of replacement is very high. And the cost of low morale among those who avoid the lay-off could also be quite high. QUOTE]
If it is a privately held company there are no stockholders to worry about. The main financial worry would be if you have enough cash on hand to see you through the transition.
JohnPlace I completely agree on people being the most important and most expensive resource. Also, they are people…
I have no idea why my quotes didn't work. Blah!