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Social Performance: XYZ Motor Company Essay

XYZ motor company is a medium-sized public corporation. The corporation is a United Kingdom-based motor vehicle manufacturer and financier with global sales of about $170 billion. A review of the corporation’s culture and organization reveals that the company has a brilliant record of social performance.

However, radical changes should be made to make the corporation’s business viable, profitable, and sustainable in the long run. In the last financial year, the corporation recorded a loss of $3 billion in its manufacturing division. Nonetheless, the loss was compensated by a profit margin of $5 billion made by its finance division.

The corporation employs about 6,000 people in its production, administration, and research departments. The corporation has been in operation for the last 50 years. During this time, XYZ Corporation has acknowledged the presence of trade unions.

The union representing professionals in the manufacturing and mechanical sector is the largest in the corporation. The general workers’ union follows this union. The corporation’s unions are so influential that they act as a benchmark for negotiations over pay for the entire industry and, more so, for the general workers segment.

The global overcapacity in the automobile industry has had a significant impact on the corporation’s operations. Nearly all the principal motor companies are minimizing on production and reducing the number of employees. Consequently, most companies are coerced to close some of their operations or downsize them. Similarly, XYZ Corporation finds itself in a similar situation.

The company is obliged to close down its manufacturing operations. However, beyond compliance with minimum legal obligations as regards consultation and redundancy payments, the corporation is not under any obligation to make additional social provisions targeted at reducing the effect the economy or downsizing size of their staff (Lawrence & Weber, 2010).

Primary stakeholders refer to a group of people most impacted by the results of any given project whereas secondary stakeholders are individuals not directly affected by the outcome of a project. Nevertheless, this group has an interest in the project.

Their principal function is to offer aid to the primary stakeholders. XYZ Corporation intends to announce its plan to close its motor manufacturing operations. The project is expected to last three years. The closure is effective from December 2015. The major primary stakeholders affected by the closure would be plant managers, and the trade unions members.

Therefore, the company seeks to establish an advisory board appointed to supervise the process of reorganization, retraining of staff, and retrenchment. Moreover, the corporation will also involve trade union officials at the district level. Finally, the local authority, development agencies, and expertise in councils will also be engaged in the project (Lawrence & Weber, 2010).

As the chief executive officer, I intend to enhance voluntary retrenchment and early retirement packages. Moreover, employees will be provided with a wide array of training prospects.

In line with this, the administration is strengthening the training framework in collaboration with relevant agencies since we expect a majority of the workers to take advantage of career training (Lawrence & Weber, 2010). However, we are also considering the availability of vacancies in other sectors of the corporation where some of the workers can be redeployed.

The corporation also intends to make a long-term commitment to the manufacturing site. We intend to invest $150 million in a diesel engine firm. This facility is expected to create about 1,200 jobs. In our case, the government can be perceived as the secondary stakeholder.

Consequently, there is pressure from the government on the administration, to ensure that actions taken do not contravene corporate social responsibility. In addition, the government indicates that such actions should reduce the level of contribution to the local economy (Rivera, 2012).

In this regard, XYZ Corporation aims to make more contribution to the local economy through the project. Moreover, the corporation realizes the importance of remaining committed to fulfilling its social corporate responsibility (Rivera, 2012).

The corporation intends to contribute towards development of expertise in the local region. The nearby local authority regions are among the most deprived in the country. In this case, the regions comprise of a large proportion of semiskilled and low-skilled workers.

Moreover, the region has a diverse minority ethnic population. The corporation is also aware of the prospect of its location. The government intends to invest heavily in the region on housing and infrastructure. Accordingly, we plan to collaborate with secondary stakeholders including the London development agency, London expertise council and two local institutions of higher learning (Lawrence & Weber, 2010).

Several other institutions are also willing to ensure that we have a wide scope of business associations in the region. The overriding objective is to establish a centre for excellence in engineering and manufacturing. In addition, the corporation will establish a business incubation centre, which will be rolled out to new enterprises.

The chief mission of the centre for excellence will be to offer a wide variety of engineering and manufacturing courses, which will vary from basic to professional training. Consequently, the cooperation of existing staff in taking up vocational training will be the initial step towards establishing the center of excellence. The corporation intends to hire some of the members as trainers, once they acquire professional accreditation.

Nonetheless, considerable drawbacks are expected during the restructuring process. For instance, we expect extreme resistance from the well-established trade unions. The same is expected from secondary stakeholders. Therefore, the corporation has an enormous task of convincing the stakeholders that the intended changes are necessary.

Moreover, the excellence and business incubation centre is anticipated to encounter financial constraints. Cost overruns with regard to operation cost and capital expenditure is expected. However, in order to harmonize the budget and ensure the long-term survival of the project, XYZ Corporation intends to invest at least $8 million in a period of five years. These funds will be sourced from the London development agency.

The corporation’s projection is that, in the end, the excellence and business incubation Centre will offer training to diverse apprentices and a wide array of courses through the two institutions of higher learning. Moreover, the focus is to move from low-level professional training to higher profession in engineering, business studies and manufacturing courses.

The vision of the Centre is to endeavor to tackle the effects of restructuring in economically disadvantaged and culturally diverse regions (Rivera, 2012). Despite the fact that XYZ corporation intends to develop the fundamental idea, stakeholders, both local and secondary, will be adequately consulted.

These consultations will be either directly or indirectly in relationship to the project. Collaboration with institutions of higher learning will supplement the objective to offer unique prospects for students. This will enable them to pursue professional training from fundamental level to graduate level.

Consequently, the corporation will achieve its corporate social responsibility commitment through improving the living standards in the deprived region (Rivera, 2012). Moreover, XYZ Corporation looks forwards to experiencing a turnaround from making loses to profitability.


Lawrence, A., & Weber, J. (2010). Business and Society (13th ed.). New York, NY: McGraw-Hill/Irwin.

Rivera, J. (2012). Business and Public Policy: Responses to Environmental and Social Protection Processes (Business, Value Creation, and Society). Cambridge: England: Cambridge University Press.

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