Reference no: EM133211797

Case: You have been asked by the president of a large company to attend a meeting involving the president and six vice-presidents. As an independent HR consultant, you are pleased to have the opportunity to work with this particular company, since it has over four hundred employees and you are looking for larger clients than the smaller businesses you have been working with lately. At the meeting, the President fills you in regarding what everyone else at the meeting already knows - that the company is experiencing a downturn in sales that has resulted in a 25% loss of revenue. Everyone at the meeting is quite concerned, and the President tells you "it's obvious we have to clear the dead wood out of this place. It's get lean or die!" You ask what the group believes caused the downturn, but only get bewildered looks in response. The President tells you that neither he nor the company has ever had to anything like this before, so he will be relying on
you to show them the best ways to "get lean."

The President further tells you that he thinks it only makes sense to cut 100 employees, since that would reflect a percentage reduction (25%) equivalent to the percentage loss of revenue the company is experiencing. He wants this done immediately - in 30 to 45 days maximum. One of the VP's speaks up and says that such a cut could result in "some pretty unhappy people around here." The President responds, "I doubt that - those that are not cut will be really happy to have a job, and I suspect they'll be motivated to great work in the future."

The President also says that he would be willing to listen to you if you suggest some early retirement buyouts for senior employees, but he thinks it is probably going to be too expensive. He thinks layoffs would be a better idea, and would like you to submit a plan involving the layoff of older employees, since they are the ones that are "probably the most expensive and least flexible." He seems unaware of any legal requirements regarding older employees.

At this point in the meeting, the President turns to you and says "Well, what to you think? Can you help us?" What you say to each of his ideas above? What other ideas can you suggest? Be sure to integrate the readings both from Chapter 2 of HRM (particularly the section on "Workforce Realignment") and the assigned portions of EGE, into your response.