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Retrenchment Of Workers: An Indication Of Corporate Arthritis And Managerial Epilepsy.

Retrenchment Of Workers: An Indication Of Corporate Arthritis And Managerial Epilepsy.

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By Chris. N. Ohanemu Ph.D

Let me break this silence! The news with its attendant panic has filled the air all over the world, particularly in Nigeria. It’s all about organizations, especially in the private sectors that have retrenched workers as a result of the lockdown that followed the Corvid 19 pandemic.

The same action has created another set of diseases in families and increased blood pressure in workers themselves. But all over, firms that have done this have told everyone that cares to know that they have moved from one disease (Corvid 19) to another (corporate arthritis and managerial epilepsy).

It’s expected that most managements should have identified from the beginning of the lockdown, or predict how their business would be affected by lockdown and so, plan on how to move forward thereafter. In the wake of the pandemic, most governments advised that certain categories of workers should work from home. Yes, what kind of work were these managers doing from home?. Was it not supposed to be a time for managers to apply managerial skills, take a hard view of the present and likely future environment of their business? Again, was it not an opportunity to apply critical thinking skills, to consider every relevant factor that might impact their operations now and in the future? After all, this is the first global inconveniences that we have experienced in the past century. The job of a manager requires strategic thinking, and this should be extended to the future behaviour of demand.

THE SITUATION.

The worst thing that can happen to an organization in the midst of this kind of crisis is to develop some “terminal diseases” (“swollen legs or joints”- corporate arthritis and or management’s sudden loss of consciousness – managerial epilepsy).

For good managers, there is a need to recall from Chandler, that changes can only be necessitated by changes in strategy. The question now is, when did they not sit to change the strategy? If they did, is it certain that not all the necessary factors were considered? An if YES, still, who tells them that the designed operations cannot accommodate everyone there before the crisis?

Are firms talking about retrenchment just for its purpose? I know that cowardice is infectious, but retrenchment is not supposed to be infectious. Even if you call it downsizing or any of those imported nicknames in the field of management, it’s not to be treated as a bandwagon exercise.

Look here, my good managers, an organization that retrenchment today and employs tomorrow has just held an exercise in futility. I call it “failed retrenchment exercise”

IMPLICATIONS

Have you considered these implications?

As a consultant, I know of several organizations whose problems may not be heavy salary bills, but a high level of corruption among managers. In such a case, what is the essence of retrenching workers? Who is to retrench who? And if in any event such organization retrenchment after the lockdown, it will employ later and may get the worse staff.

(b) Again, in a downsizing exercise where the focus is just to reduce the number of employees while holding managers as sacred cows, it is to be noted that there may be some managers whose salary is greater than salaries of ten employees put together. Who then should be retrenched and for what reasons also?

(c)  A firm that is downsizing because it predicts low demand for its products or services should first look for “medicine” for corporate arthritis and managerial epilepsy. Expected low demand can never be an adequate excuse for downsizing since it’s known that to a large extent, demand is related to population and ability to pay.

In any country where Corvid 19 did not reduce the population by more than five per cent, there is no justification for companies or governments to talk about the likely absence of demand as a reason for downsizing. After all, a popular joke in Africa says, “man must walk and man must live”

(d)   Remember once more that, the more people you make to leave your organization, the more competitors you are creating against your operations. At best, a junior worker who is sacked today may move to your competitor with some of your trade secrets or any information that can make him be accepted by such competitors. Besides, managerial arrogance is another symptom of managerial epilepsy.

CAN WE TRY THESE?

There are things we can do to prevent infection from new diseases when we are recovering from old ones.

If demand is the central reason:

(a) Sit, think, brainstorm to discover the likely state of demand for the company’s products or service.

  1. If it’s declining demand, co-opt the marketing department and work out relevant actions on creative remarketing of the firm’s products or services.
  2. If on the other hand, your firm is apprehensive of the fact that demand for its products or services may not be there at all, why not discover new interests of people in your market and work on benefits that relate to them?
  3. There are more novel demands that are likely to arise after Corvid 19. Search for them, sit and think.
  4. Why not “borrow half of their salaries” to go into constructive expansion or diversification or niche finding and operating?

The worst that can happen is that good organization, while doing this may pay workers half salary for not more than two or three months, after which they will stagger refund of the arrears for seven months based on agreed convenient percentage and some understanding.

Retrenchment has never solved any organization’s problems in this part of the world. Even in a turnaround exercise, it is an area handled with extreme care. It is good to learn from what happened to others. Some organizations have retrenched twice in eighteen months, and on the third attempt, it was sold off at a giveaway. Some government agencies retrenched several times because each new chief executive saw it as the only solution to what he/she thought was the problem. And these organizations still almost went under, but for the intervention of government.

Recall that the carpenter whose only tool is a hammer treats every problem as a nail.

No problems, if your opinion is different from mine, you can reach me through my email- krisndu60@gmail.com.

 

Bernard TaiwoBernard Taiwo
Bernard Taiwo
I am Management strategist, Editor and Publisher.

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