Market Strategies of Unilever - Essay Example

In the News Assignment AFFILIATION: Unilever Closure of business units or any of their manufacturing plants at any given point of time is a very alarming situation for the business organization. Unilever has recently announced that they are to cut down on 300 jobs and are closing down three of their manufacturing plants in Wales. Two other factories that are located in Swansea and Bridgend have been announced by Unilever to be shut down by the end of year 2013. This would lead to a further loss of 250 jobs. Furthermore they plan to shutdown Ewloe in Flintshire by the end of 2014 and this will lead towards movement of jobs in Wirral (Wright, 2012). In times of economic recession, businesses are mostly facing such situations as they are not able to gain the required profits from all their business units operating locally and at the global level. The closure of three units currently would affect the economic cycle of Wales greatly but Unilever as an organization is facing the effects of recession and therefore has to take such steps of downsizing and closures of factories in certain areas (Wright, 2012). Business shuts down some factories by reviewing their profits and losses. The main reason for business shutdowns are due to the fact that their marginal revenue is below their average variable cost. The analysis is done based upon whether the particular factory is adding on to the profits or is allowing it to be an expense for the organization. Such decisions need to be carefully reviewed by the managers before giving the final verdict as shut down decisions allows the unemployment rate to increase for the economy. The organization also has to face charges against being not a corporate socially responsible organization as shutting down factories in between work operations impacts the work force tremendously. The shutdown of business leads the workforce to be in a stressful situation as their source of income and medical facilities are impacted due to loss of jobs. Along with impacting the economy, this further affects the family life of the employees. There are some strategies that can be implemented by managers to help reduce the layoff effects on employees. They are as follows (Klein, 2012): The managers need to disclose the news on an immediate basis and with full honesty and sincerity. The clear picture should be told to the employees so that they don’t have doubts about any prevailing or future circumstances taking place in the organization. The managers should let the employees reveal their emotional response without getting agitated or frustrated. The emotional responses of employees may be through showing anger, depression, and insecurity so on and so forth. The managers should console the employees in a gentle way. The managers should assist the employees in reducing their work frustrations that occurs for the remaining time period of the job. The employees may not be interested in performing according to requirements and managers need to assist and should help them in looking for other opportunities. The managers should let the employees know that they are interested in their long term careers and therefore may work upon shifting them in other business units if conditions allow them to do so (Schein, 2009). The managers need to work upon long term strategies which include appropriate preventive measures to be taken while in the scenario of facing factory shutdowns. Consumers are the most vital stakeholders for any organization and shutdowns would impact the brand name of the organization. Consumers may switch to other brands at a very fast pace and Unilever may lose a substantial amount of customer base due to shutdown of their manufacturing plants in some areas. The business organization may have to invest in developing their customer base again in regions where there market share has decreased due to shut down of manufacturing operations. The way above news is important to the Course Studying about organizations that had to conduct layoffs or had to shut down some of their manufacturing operations in certain areas is vital as this would allow students to understand in dealing such situations. During shutdowns, managers have to face a lot of resistance from the employees of the organization. As shutdown impacts them highly so a lot of resistance is observed from them. Employees working at other units also develop the fear that due to shutdown of one factory, the other might also have a chance of shutdown and hence they start looking for other jobs. Turnover in other business units may increase due to shutdown of one business. Employee resistance and employee turnover are major challenges for businesses to deal as it involves dealing and handling employee issues directly. Employees are an asset for any fim and when any such situation arises the organization tends to lose a major portion of their valuable workforce. Managers need to constantly monitor all the work processes and keep a strong check on profit and loss of the organization so that timely measures can be taken to prevent such decisions of shutdown to be taken (Northouse, 2010). Practical Managerial Implications Managers would be required to focus on future research responsibilities so that the organization can overcome the effects of shutdown (Cox, Blackstone, and Schleier, 2003). The workforce would need to be given consultation sessions by the managers of Unilever so that they can look for other opportunities (Applebaum and Steed, 2005). Conflict management situations may arise and managers may need to demonstrate their interpersonal and leadership skills in handling the workforce that are going to lose their jobs in near future. Human resources are resistant to any type of change taking place in organizations and a change such as a shutdown would cause them to create a chaos in the organization. The managers should follow the strategies that have been mentioned earlier in the discussion to reduce the affect of layoff news on employees. Strategic plans and long term strategies may need to be developed by the managers to overcome the situation of business shutdown and disappointments in the business performances of the particular business unit that has been shutdown. References Appelbaum, S.H. & Steed, A.J. (2005). The critical success factors in the client-consulting relationship. Journal of Management Development, 24(1), 68-93. Cox, J.F., Blackstone, J.H, and Schleier, J.G. (2003). Managing Operations: A Focus on Excellence. Great Barrington, MA: North River Press. Klein, Douglas (2012). Five Strategies for Managing After Layoffs. Human Resource Executive Online. Retrieved October 3, 2012 from http://www.hreonline.com/HRE/story.jsp?storyId=156838048 Northouse, Peter G. (2010). Leadership: theory and practice. Sage Publications. Schein, E.H. (2009). Process Consultation and the Helping Relationship in Perspective. Retrieved October 2, 2012 from http://andewal.com/archive/process_consultation.pdf Wright, Benjamin (2012, September 13). Unilever confirms 300 job cuts and closure of 3 Welsh plants. The Independent. Retrieved October 3, 2012 from http://www.independent.co.uk/news/business/news/unilever-confirms-300-job-cuts-and-closure-of-3-welsh-plants-8134978.html Read More