What is downsizing and how is it best done? List and describe four ways of choosing who gets targeted during a downsizing
What will be an ideal response?
Downsizing is the process of permanently reducing the number of a firm's employees so as to improve the efficiency or effectiveness of the firm. Downsizing is a popular way for organizations to attempt to improve their flexibility by reducing their bureaucratic structures, giving employees who have been retained by the firm the power to make decisions more quickly, and improving communication within the firm. A downsizing can also be done, however, in response to a merger or acquisition, revenue or market-share loss, technological and industrial changes, a restructuring, and inaccurate labor-demand forecasting.
If the choice of which employees to downsize is not constrained by a collective bargaining agreement (which usually mandates that union members with the most seniority be retained), there are several ways to choose who to target in a downsizing. Across the board downsizing requires all of a company's units to reduce their headcount by the same percentage. Geographic downsizing targets specific locations for employee reductions, perhaps due to the loss of an important customer. Business-based downsizing targets only certain segments of a business. In addition, downsizing can target specific functions or departments that need to be reduced, or specific positions or jobs that are overstaffed. Performance-based downsizing targets poor performers. When downsizing is seniority-based, the last people hired are the first people let go. If cost cutting is a goal of the downsizing, salary-based downsizing can help a firm reach this goal. This method involves targeting a firm's most highly paid employees. Competency-based downsizing involves retaining employees with the competencies the company expects to need in the future and downsizing employees who lack them. Downsizing can also be done through self-selection, if a firm offers its employees inducements to leave, such as early retirement packages or buyouts.
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Clark bought Series EE U.S. Savings Bonds after 1989. Redemption proceeds will be used for payment of college tuition for Clark's dependent child. One of the conditions that must be met for tax exemption of accumulated interest on these bonds is that the
a. Bonds must be transferred to the college for redemption by the college rather than by the owner of the bonds. b. Bonds must be bought by a parent (or both parents) and put in the name of the dependent child. c. Bonds must be bought by the owner of the bonds before the owner reaches the age of 24. d. Purchaser of the bonds must be the sole owner of the bonds (or joint owner with his or her spouse).
FedEx chose Memphis, Tennessee, as its U.S. hub because:
A) the city is in the center of the United States, geographically. B) the airport has relatively few hours of bad weather closures. C) it needed a means to reach cities to which it did not have direct flights. D) the firm believed that a hub system was superior to traditional city-to-city flight scheduling. E) All of the above are true.