I was tasked to conduct an independent business review for a local manufacturing company and manage the implementation of the recommendations. My findings led to a number of recommendations,which ultimately included staff rationalisation as a major and most important measure to mitigate the financial hemorrhage the company was suffering!

Now .....,I have to fire more than half the staff! During the review,I'd sat down with the employees to hear their views about the performance of the company and I was shocked at what they had to say! They'd gone for 3 months bila salaries,and even when paid,it was 8k,12k,14k! Very little money! I sympathised with them!Unfortunately,the law provides for payment of a maximum of 20k when you have to terminate employees on account of insolvency!

My heart tells me these guys deserve better (some have 20 years experience),but my head tells me I have a duty to my client (to save the company)!

Worse still,the production manager (God has a sense of humour),happens to be an old flame with whom things didn't end well! I have to fire him as his department is the worst performing!

What would you do? Any alternatives? The company is operating on a negative cash flow! They have very few alternative investments,so no overdiversification! My client is the secured lender and has refused to advance any more money to them! Sales can be improve but that would require a significant injection of cash,which my client has refused to do until cost-cutting measures are implemented!

Help!


Immorality: The morality of those who are having a better time!

That's quite a tricky one.

It seems that without letting some guys off,the company could go under.

Maybe making the situation clear to the guys who have to be let go,might ease the situation (a bit).

sasha..the world is a tough and cruel place. whoever paid you to do this job paid you in cold hard cash,expecting you would deliver a 'cold,nothing personal' objective report. fire the extra folks. starting with the useless ex. kazi ni kazi,no mucking around.

He who laughs last thinks slowest..

@ Sasha,don't look to get one back on the ex,it is demeaning..................but go for it,let him have it........

Poor performance in both places.....he must go.........and save the company by letting people go..........
Maybe as a compromise you could ask the client to retrain them............those under 40.........

Thinking is free...............so THINK!!

What are the prospects of the company? Is the HR element the biggest cost item? Are other areas that are haemorrhaging cash? How did they get there the position they are at in the first place? Sales went down? Costs went up hence margins were squeezed?
Unfortunately,the longest workers are always the most expensive,and if the HR costs are significant,the first in first out theory must be used. Does the company rely on intellectual power,hence the longest serving staff are the most productive?
Alternatively,I remember when Sarova went through a crisis previously due to tourism downturn,they correctly surmised that future prospects were bright and they just had to whether the storm. They put their workers on leave shifts (two weeks work,two weeks leave etc.) until the business picked up. By doing this they retained their staff,boosted morale (no one went home) and are today doing well. Maybe this model can work.