Reference no: EM133048630

A company which is currently maintaining its accounts manually is installing an accounts software so that all its accounts transactions can be done digitally. This will provide greater speed, accuracy, efficiency, and productivity. However, this initiative would also result in downsizing the Finance Department where the current strength of 38 employees, mostly in the age group of 45 - 60 years, is expected to reduce to 20 employees only.

This initiative is led by the Chief Finance Officer (CFO) of the company who is a young, very competent finance professional. He is a serious, results-oriented professional and wants to do the project in just two weeks. He is also an introvert, quiet, poor in communication and negotiations. He usually makes the strategies and decisions alone and did not consult the HR Manager about the Accounts Software Project and the impending downsizing and got approval from the CEO directly. The CEO was under the impression that the plan had already been discussed and agreed with the HR Manager.

The HR Manager has only recently heard about the downsizing through the company's grapevine and is very upset about this decision and lack of communication.

When the HR Manager, who is in a job grade lower than the CFO, tried to explain to the CFO the negative consequences of the sudden downsizing, including the loss of morale and productivity of the employees, the CFO said he had already made his decision and will not reconsider.

Several employees from the Finance Department, particularly those who are over 55 years, fearing that they would be laid off, are approaching the HR Manager. These employees of Finance, who are unaware of the new Accounts Software Project and its implementation plan, are not approaching the CEO as the CEO is only accessible to the heads of departments.

The firm which has a history of 63 years and is a reputed and successful industry leader, believes in high ethical operating standards. It is a well-established, traditional, hierarchical, and bureaucratic organization. There are 32,000 employees spread in different locations and countries. The locations and departments mostly work in silos with little interaction. The head office senior management team rarely visits these locations, and the CEO, who is 76 years old, does not like to travel. Employees also generally work individually instead of teams. The internal culture of the company is very competitive and centralized with top-down communication.

How should the CEO of the company:

a) negotiate with the CFO to review his Accounts Software Project, so that it is implemented gradually in 8 weeks instead of two weeks, and the retrenchment is also minimized?

b) ensure that there is collaboration between the CFO and Manager HR and both own, coordinate and implement the plan together?

c) communicate the plan to the employees of the company at the head office and at all locations?

d) and HR negotiate with the employees who are going to be laid off?

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