After struggling to stay afloat over the last few years, Circuit City announced that it will close it's remaining 567 stores; adding about 34,000 to the fast growing list of unemployed in these uncertain economic times.
In 2007, Circuit City decided to lay off (replace) 3,400 workers. The decision was made to lay off top earning employees and replace them with lower earning ones. It's pretty easy to see the logic here: lower paying usually equals less experienced. Those of us in HR know that less experience means higher turnover, higher recruiting costs, higher training costs, and the list goes on.
When this decision was made, I wonder where was HR. Were they simply trumped by the decisions a CFO made? In a case like this, HR should have given facts and figures on the overall outcome of the decision over time, rather then simply looking at the cost savings of an employee's salary.
May this serve as an eye opener to us in Human Resources. Yes, it's important that HR decisions have the company's bottom line in mind; however, it’s equally important for HR to stand up for the moral and needs of employees.
nice post and nice point! don't you wish that various departments in a company would interact more in general? seems that people don't realize the value of bringing in different teams to share ideas for projects, especially those that don't obviously "belong" to that group.
when will they learn!?
Posted by: Agatha Kubalski | January 20, 2009 at 01:03 PM
This is definitely one of the challenges in organizational management. Although they are numerous examples were problems could have been avoided by bringing in a group that "didn't belong", top brass continues to think that that would be a waste of time.
So, how do you actively get all teams to communicate effectively?
Posted by: HR Tony | January 23, 2009 at 12:20 PM