Introduction
The inherent problem with interruptions to business is that not only does it create problems from an operational cost standpoint but it also causes problems from a labor standpoint since if the company has the same workforce yet has fewer orders this represents a gross mismanagement of human resources. When examining how a disruption will affect productivity several factors need to be taken into consideration.
The first factor is how long the company can maintain its current rate of operations before operational costs exceed profitability. A “shut down” of the Federal Government can last months to just a few weeks or even days and as such a company cannot just simply cease all operations only to find out that Federal Government is back a few days later.
Proposed Reduction Workforce Hours
As such one strategy that is necessary is to determine how long operations can continue under their current rate before the company needs to scale it back.
Estimates need to be done as to when would the Federal government be reopened, what size would the workforce reduction need to be, how will the company gradually divest itself of unneeded staff and what sort of strategy can be implemented in order to get the company back on track once things return to normal.
One alternative strategy that could work while maintaining some semblance of normal operational capacity is to drastically reduce the number of hours employees come to work for during the shut down period.
The advantage of this method is that while it drastically reduces labor costs it enables the company to maintain its current workforce so that once the shut down ends it can return to full operational capacity within a short period of time.
Laying off people has the distinct disadvantage of not only resulting in costs related to recruitment in the future in order to replace the lost workforce but it also entails the company having to pay significant costs in severance packages (Hollett, 2003). It is based on this that limiting the number of work hours seems to be a far better solution as compared to merely firing people en masse.
Limiting Operational Capacity
Another factor that should be taken into consideration is the possibility of discontinuing certain aspects of the company’s operational capacity during the shut down. What must be understood is that certain aspects of operations entail a significant resource cost in terms of utilities, raw materials and other such factors that contribute to normal company operations.
If a shut down does occur it would be necessary to partially reduce services to these operational areas by first reducing the number of employee hours as indicated in the previous section and by slowing down operations to at least 20% of its previous operational capacity.
The reason this is done is so that at least some products can continue to be produced which can then be subsequently stored by the company and utilized at a later date once the shutdown ends.
Conclusion
Based on the given strategies presented in this paper it is likely the company will be able to come through the storm of a possible Federal government shutdown and continue to operate normally in the future. It must be noted though that this particular strategy of reducing work hours while maintaining the same amount of workers is feasible only with the short term.
A prolonged shut down will result in several workers either transferring to other companies or the company firing them due to lack of overall business. As such this particular solution cannot be considered the best possible resolution but rather a stop gap measure to maintain operations to a certain extent.
Reference
Hollett, B. (2003). Preparing for Uncertainty: Guidelines for Laying Off Workers and Creating Equitable Severance Packages. Employee Rights Quarterly, 3(3), 70. Retrieved from EBSCOhost.