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  • A Case The Downsizing Decision by Raghvendra Patel

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    Corporate downsizing often results from poor economic conditions that force a company to cut jobs and costs to maintain profitability. Downsizing involves layoffs, followed by other restructuring like branch closings and department consolidations to reduce expenses. The document discusses a 35-year old electrical company that is considering downsizing its workforce from 40,150 employees to cut increasing costs and improve profits, especially in its wire and cable division that has low profits and high costs. The company is evaluating strategies like adopting new technologies, outsourcing, relocating operations, and making overhead costs more flexible to weather the challenges.

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    A Case The Downsizing Decision By Raghvendra Patel

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    Corporate downsizing often results from poor economic conditions that force a company to cut jobs and costs to maintain profitability. Downsizing involves layoffs, followed by other restructuring like branch closings and department consolidations to reduce expenses. The document discusses a 35-year old electrical company that is considering downsizing its workforce from 40,150 employees to cut increasing costs and improve profits, especially in its wire and cable division that has low profits and high costs. The company is evaluating strategies like adopting new technologies, outsourcing, relocating operations, and making overhead costs more flexible to weather the challenges.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPTX, PDF, TXT or read online from Scribd
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    32 views8 pages

    A Case The Downsizing Decision by Raghvendra Patel

    Uploaded by

    raghvendrapatel75
    Corporate downsizing often results from poor economic conditions that force a company to cut jobs and costs to maintain profitability. Downsizing involves layoffs, followed by other restructuring like branch closings and department consolidations to reduce expenses. The document discusses a 35-year old electrical company that is considering downsizing its workforce from 40,150 employees to cut increasing costs and improve profits, especially in its wire and cable division that has low profits and high costs. The company is evaluating strategies like adopting new technologies, outsourcing, relocating operations, and making overhead costs more flexible to weather the challenges.

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    Download as PPTX, PDF, TXT or read online from Scribd
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    of 8

    The Downsizing Decision

    P R E S EN T ED BY-
    R AG H V EN D RA K U M A R PAT EL
    R EG S . NO - 5 11 7
    What is Downsizing ?

     Corporate downsizing is often the result of poor


    economic conditions and/or the company’s need
    to cut jobs in order to lower costs or maintain
    profitability.

     Downsizing results in layoffs that are often


    followed by other restructuring changes, such as
    branch closings, departmental consolidation, and
    other forms of cutting pay expenses.
    SWOT Analysis
    Strengths
    The Performance of switch gear and connectors
    divisions are highly satisfactory.

    Diversified product is also a platform for the


    company.

    The 35-year old electrical company has 40,150


    employee on its rolls.
    Weaknesses

    15 year experience person Mr. Navotha Patel is


    retiring and being immediately replaced by Mr.
    Sateesh.

    The performance of wire and cable is the cause of


    concern. it is operating with least profits and high
    costs.
    Opportunities

    New chairman has two tasks………….


    1- Reducing the ever increasing cost
    2- to pick up a strategy to improve
    the profit position

    At the same time searching for new avenues for


    additional revenues.
    Threats

    Reducing the employee at connectors division


    From 6,720 to 6,000.

    Reduction of EPC staff

    Decision can move the company towards more


    favorable result in future.
    Strategy should adopt………….
    Adopt New technology

    start outsourcing

    Transferring the company location or incorporation to a


    low labour and/or low tax location

    Cost flexibility by turning fixed overheads into variable


    costs

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