Process to follow when changing team structure
It is inevitable once in a while to restructure an organisation in terms of resizing the employees. The restructuring process is normally referred to as retrenchment and the process must be carried out in a manner that will ensure all employees are comfortable and that the affected employees are not psychologically affected.
There are various reasons that lead to loss of jobs and these may include; technological changes and closure of the workplace. For this organisation, the reason as to why there is need for a restructuring of the team is due to the current economic downturn being experienced in the world. In order to make these changes, the following process will be followed.
Ensuring that the restructuring is necessary: it is important to ensure that the process is necessary in order to avoid mistakes that may cost the company in future in terms of new employees’ recruitment costs.
Evaluating alternatives: in some cases, other alternatives may be sought instead of reducing the number of employees. Some of these are; freezing new hiring, reduction of salaries and voluntary early retirement among others. In this case however, it is necessary to carry out the retrenchment process.
Gathering important information on the process: it is important to get as much relevant information as possible such as the legal and economic consequences before engaging in the process of retrenchment.
Carry out consultations with key stakeholders: carrying out consultations with employees, trade unions and any other stakeholders is important in ensuring that the process runs smoothly.
Establish the right retrenchment procedure: it is important to create a committee to implement the retrenchment procedure and the members should be from the organisation.
Implement the retrenchment plan: the last step is to implement the plan and this involves conducting interviews with the every employee who is affected by the retrenchment as well as making sure that severance payments are made in time.
Resistance to the changes and how to manage them
Retrenchment is a form of organisational change just like any other and therefore there is bound to be resistance from employees. It is therefore important for management to anticipate this change and prepare adequately to handle it in a manner that will ensure that the process is successful and that all employees are left satisfied.
The success or failure of the retrenchment process will greatly be influenced by how management handles the expected resistance from employees. Such resistance should be managed so that the process can be implemented in a manner that is in the best interest of all stakeholders. The main factor that may lead to employee resistance in the case of retrenchment is the lack of proper communication by management.
In order to effectively manage employee resistance, the management will be expected to communicate the intentions early and to ensure that all stakeholders are involved in the process from the beginning to the end. Consultations with all stakeholders will ensure that the management and employees reach a common ground and lay down the procedure for retrenchment in consideration of the interests of all stakeholders.
Such an initiative will ensure that the retrenched employees are adequately prepared for the job loss and they are also timely and adequately given their termination dues. This will help make the transition to unemployment smooth for them and also reduce the costs that the organisation may incur in terms of legal costs in case of litigations by the affected employees.
Definition of corporate social responsibility
Corporate social responsibility has been given various definitions but can be simply defined as a form of self regulation where companies incorporate the society’s interests in their business models. This involves making sure that the activities of the firm do not affect stakeholders in a negative way.
There are cases where firms go beyond the simple compliance of laws and regulations to also engage in activities such as humanitarian activities for the good of the society.
It is therefore true to say that organisations engage in corporate social responsibility activities as a way of taking responsibility of their actions and to ensure that their actions have no negative impact on the various stakeholders including customers, suppliers, creditors, regulatory authorities and the employees themselves (McWilliams and Siegel 120).
In the case of this firm, there are various stakeholders who may be affected by its activities. These include; the local community, the people who live downstream, the employees and their families. The action of draining the waste from the company into the local river is not in line with the principles of corporate social responsibility as it may lead to health implications for the people who consume its waters.
Another issue is the plan to reduce the number of employees in the company. This may results in social problems to the families of these employees as a result of the sudden loss of income. It is therefore important to note that in the case of this company, social responsibility would involve seeking for a new way of disposing the waste and also seeking a new way of increasing the return on investment other than the proposed staff cuts.
Issues to be addressed with the board
In trying to ensure that the organisation is socially responsible, various issues will be brought to the attention of the board. First, the issue of waste disposal will be addressed as the current practice of disposing waste into the local river is harmful to both the environment and to the people who use its waters for domestic purposes.
Suggestions will therefore be made on how to dispose the waste in a more environmentally friendly and socially responsible way. Secondly, the issue of staff cuts will be raised. This is due to the fact that retrenching employees will mean loss of income and this may affect them and their families in a negative way.
Suggestions of other options of increasing the return on the investors’ capital will be made in order to ensure that employees are not retrenched. It is also important to note that the retrenched employees may be affected psychologically and they may therefore not be able to engage in any other income generating activities.
Benefits and limitations of being socially responsible
The main benefit of being socially responsible for an organisation is that it gains a positive reputation in the society and this is normally followed by increased business activities. Being socially responsible also helps the firm to attract and maintain talented employees due to the fact that most people like to be identified with reputable firms.
The limitations of being socially responsible are based on the shareholder theory which argues that the actions of management should be directed towards maximising shareholder wealth. Management may therefore focus more on being socially responsible and forget their main objective. It is therefore important to balance the two objectives (Bhattacharya, Sankar and Daniel 125).
Works Cited
Bhattacharya, CB, Sankar Sen and Daniel Korschun, Leveraging Corporate Social Responsibility: The Stakeholder Route to Business and Societal Value. Cambridge, UK: Cambridge University Press, 2011.
McWilliams, Abagail and Siegel, Donald, “Corporate social responsibility: A theory of the firm perspective”. Academy of Management Review 26 (2001): 117–127.