Question

The Scenario Imagine that you have graduated and are working for a large manufacturer in the United States. One of your firm’s largest departments is Customer Service. Approximately 475 people located in 5 cities in the United States are employed in the Customer Service Department. Upper management in your firm is considering relocating at least half of the positions (not the people) to India. If the firm chooses to relocate these jobs in Customer Service, approximately 250 people in the United States will be laid off. However, the company will be able to cut the costs of operating the Customer Service Department by 1/3. This is a significant saving for the firm! You have been appointed to a cross-functional team of managers to make three recommendations regarding this proposal. There are 5 managers on the team. They come from the following departments: Accounting, Human Resources, Customer Service, Production and Marketing. Your answer must be divided into 3 clearly marked sections: Critical Thinking; Business Ethics; Team Building 1. Did you offer a specific principle? 2. Did you explain an approach rather than a solution? 3. Is the principle clearly stated? 4. Did you elaborate on how the principle would be used?

Answer 1

Solution

It is given that approximately 250 people in the US are to be laid off as a part of the cost-cuttting strategy of the company.

Given that I am a part of the cross-sectional team of managers from the departments of Accounting, Human Resources, Customer Service, Production and Marketing.

Critical Thinking  

Problem : Our company wants to improve on it's operating costs.Since the customer care department being one of the largest in our company,it has been under focus as significant cost savings here would lead to significant cost savings for our overall company.

Presently this department is operating with 475 employees spread over 5 cities across the US.

Solution- We have taken a decision to fire 250 employees in the US and outsource those positions to India.

Among the 5 cities of operations,there will not be any changes to the positions in the top 2 cities (by value creation to the company).The employees fired will be from the rest of the 3 cities.

Business Ethics - This decision to stop operations from 3 cities is taken for 2 reasons -a.To maximize the gains from adopting to this cost-cutting strategy ; b.The least value creating cities are also the cities where there are lower number of employees due to reasons like higher state taxes and higher wages.

The 250 who are to relived are to given severance package amount that would be equal to their 3 months earning.

Team Building - In this process,our business should not be affected as the positions are shifting to a different country (i.e.,India).So,at least their should be better coordination in the initial stages till the business is stabilized.

So,a. Additional / new positions (Managerial / supervisor)should be created in India apart from the 250 positions that are getting shifted.

b.The new managers /supervisors should report to all the managers in the five departments in the US - Accounting, Human Resources, Customer Service, Production and Marketing to ensure better coordination and stability.

1) Yes,I offered a specific principle (i.e., methodology for cost cutting.

2) Yes, I did explain an approach rather than a solution

3).Yes,the principle is clearly stated

4.) Yes, I did elaborate on how the principle would be used.

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