SUMMARY OF THE CASE
Delarks a chain of stores in the garment segment was facing severe operational losses. A change in management was proposed to turn the company around and initiate the transformation process. Harry Denton took the position of CEO and proposed an instant downsizing within the company. The process was abrupt and strategies adopted by the company damaged the morale and motivation of the employees. Appropriate measures and counseling of the employees was not done. The employees were not prepared beforehand that such a rigorous downsizing process would take place (Wetlaufer, 1998).
Some of the most senior and experienced staff, which the organization had retained over the years were fired, on the basis of low productivity. Association of the employees with the company changed, and they stopped looking at the company as a family anymore. The organization started generating profits, but the staff was demotivated. The structure of the company was about to collapse, and the management needed to assure the workers that no more downsizing would take place. Some of the most experienced and retained employees were uncertain about the fact that whether the organization will or will not retain them. This was making them seek their options with the competitors (Wetlaufer, 1998).
The organization required addressing the workforce and motivating them to look at the future. The entire downsizing process must have been dealt differently. Some of the staffs were complaining that the management was becoming secretive, and they took decisions without taking the staff in confidence about the decision. The workforce was feeling rejected and stabbed in the back by the management which significantly damaged their morale (Wetlaufer, 1998).
SUMMARY OF THE “EXPERTS” PERSPECTIVES
For repairing the damage which the organization is facing, expert advice was sought so that appropriate measures can be taken for boosting the morale of the workforce. The details are following:
Commentary 1: Bob Peixotto
The damages of the mismanaged downsizing have been very severe for the organization. Strong remedial action need to be taken for the progress and control of the organization. Some of the actions proposed were that the company must start with addressing the key people and acquire their confidence. Commitment must be sought from them to remedy the situation through straight talk. With this confidence must be shown in the staff and to support the action strong bonuses must be offered. Besides this, the organization must propose a restructure which can be done by appointing a change cosponsor. The message which will be delivered to the staff must represent the change. All the actions must show that the tough decision had been taken for enhancing the organizational performance. Foundations for the future must show all the necessities due to which abrupt retention was insured. The existing workforce must be cherished, and barriers for communication must be reduced. New policies and incentives can be considered as a step for supporting change and communicating what the organizations seeks from its employees (Wetlaufer, 1998).
The organization must remedy the past decisions and invest diligently in the existing workforce. This can assist in the confidence of the employees through which fear can be driven out. Besides this, the organization must also take measures for keeping the spirit of change alive. All this can remedy the past decisions of the organization and structure the progressive future path.
Commentary 2: Jim Emshoff
For restoring the employee trust and building the morale of the management back, pedaling must not be done; this may further damage Danton’s position. At this stage, the management must focus on improving and capitalizing the financial strength of the company. The success which the company is acquiring must be shared with the senior management for the first five years. This is important as they are the ambassadors of the workforce. If the senior management is motivated, it will automatically formulate strategies for motivating the moral of the employees.
Besides this, new steps must be taken for evaluating and building up a new senior management team. The organization can perform as one man show and hence actions for collaborating must be taken. Besides this, the management must also initiate a communication channel using which the entire staff can communicate and take actions for the progress of the organization (Wetlaufer, 1998).
Commentary 3: Richard Manning
In this, the commentator suggests that Denton must start again from the initial phase. He must depict honesty and forthrightness to the employees. Their confidence must be regained, and this can be done by writing a memo which says that the firing period is over. The tone of the memo must be apologetic so that the confidence can be regained. Mistakes of the past and actions of immediate uninformed downsizing must be remedied with new plans and actions. The entire scenario must be discussed, and surety must be given that no such further actions will be taken. Future and growth progress must be emphasized (Wetlaufer, 1998).
Commentary 4: Gun Denhart
The first priority for Danton is that the trust of the employees must be acquired at all cost. This can be done by arranging meetings with small groups of the staff throughout the organization and ensure that, in the future, such abrupt actions will never take place. The decision must be supported by saying that the downsizing was essential for the survival of the company. The tone must be apologetic and future centered. Emotional concern and guilt must also be shown so that concerns from the management can be shown. He must assure that such mismanaged downsizing will not take place in the future. Promises are just the start and actions need to be taken for ensuring employee commitment. This includes appraisal and incentive offering to the employees who are working for the organization (Wetlaufer, 1998).
Commentary 5: Saul Gellerman
The decision, which Denton implemented, is much to be blamed on the entire board. The decisions were not sole actions of Denton whereas they were the decisions which the board members had approved. The Board only emphasized on the numbers and never inquired the sustainability of the actions. The cost and the risks which were associated with the actions must have been evaluated beforehand.
The actions must be structured by keeping Denton behind the picture and implementing strategies which may keep Denton behind the scene. Measures must be taken for reducing the psychological pains and utilizing the economic gains for the motivation of the employees (Wetlaufer, 1998).
RECOMMENDATIONS BASED ON THE COMMENTARY
The suggestions given by all the commentators are effective, but the one given by Bob Peixotto is most effective. This is because he has addressed all the aspects of problems which the company is facing. Besides this his propositions also propose methods for reversing the damage done to the reputation of Denton. His actions align with the goals of the organization and suggest that the senior managers must be taken in confidence. The role of the managers is very important, and they can align the workforce to adapt to the goals of the organization.
Clear communication and assigning appropriate goals to the staff which are achievable and accomplishable can motivate the workforce. Through this, investment can be made in the existing employees who can make the goals accomplishable. This will keep the spirit of change alive and motivate the workforce to excel with the organization. This will develop a hope for the employees and take them out of demotivation. Communication of the managers and creating a channel through which Denton is accessible the employees will associate and feel a connection through which all the goals and scope can be completed. Through this, the immediate actions can be taken for the benefit of the organization (Burnes, 2004).
The role of the managers must be associative with the employees. The damage done to the company by the mismanaged downsizing requires strong actions for boosting the morale of the employees and ensures that they retain with the organization.
The workforce is the biggest asset for the organization (Anderson, 2010). Retaining the workforce requires that there confidence is earned along with their sincerity towards the goals of the organization. The immediate actions which the company has taken through the mismanaged downsizing have damaged the stability of the organization. The methods of the company must be to address the workforce directly and apologize about the action. The existing employees must be ensured that they will be retained, and no such uninformed decisions will take place. The senior management must be taken in confidence so that they can design the methods for motivating the employees. The theme must be set to look ahead at the future of the organization and let go of what has been done in the past (By, 2005).
Recommendations given in the commentary are appropriate to the decisions which must be taken by the organization. All the recommendations differ on the basis of the management style which the leadership possesses. Denton’s action has made a loss bearing organization profitable and for this reason he must take ownership of his decisions and ensure to the staff that such a mismanaged and uninformed decision will not be taken in the future. Collaboration and communication of the management with the employees will make the decision highly effective.
Anderson, D. (2010). Beyond change management: Advanced strategies for today's transformational leaders. San Francisco: Jossey-Bass/Pfeiffer.
Burnes, B. (2004). Managing Change: A Strategic Approach to Organizational Dynamics. Harlow: Prentice Hall.
Wetlaufer, S. (1998). After the layoffs, what next? Harvard business review, 76(5), 24-6.