The Importance of Organizational Sustainability - Research Paper Example

? Dynamic Leadership: Communication for Crucial Conversations 3rd, July, The sustainability of an organizationdepends on the abilities of its income to surpass its expenses. Layoffs reduce expenses and hence increase the sustainability of an organization. Restructuring a department is a short-term strategy that has long-term effect on the department. Workers often have negative attitude towards layoffs and restructuring of organizations. During the restructuring process, the welfare of the workers needs to be considered in order to achieve positive outcomes. The welfare of the workers will involve their future career prospect and their ability to withstand financial constraints resulting from the layoff. A restructuring rationale that is based on the welfare of the workers is likely to achieve support from other workers. In addition, 80% of workers are likely to have a negative attitude towards restructuring of a department. Successful restructuring will involve preparing for future layoffs and setting a kitty to compensate those affected by future layoffs. Introduction The sustainability of an organization in the modern world depends on its ability to withstand changes. Thus implementing changes is inevitable in the modern competitive world. Change within an organization can result from different factors and any change will demand restructuring of the organization. The main reason that necessitated the need for restructuring is scarcity of resources and the inability of the department to maintain the current number of employees (Concoran, & Silander, 2009). Restructuring is a difficult task since it involves making difficult decisions particularly those that are related to lying off some employees. Due to current unavoidable situations, I need to oversee the restructuring of my department, which will involve eliminating 30% of staff members in the department. The restructuring will involve both the layoffs and reassignment to other departments. This paper presents the action plan for the restructuring, a rationale concerning the final decision and the effects of the lay-offs to the budget. Action Plan Currently, the department has 30 workers who are assigned different role. The department has had the same number of employees for the last 9 years. Previously the department had 22 staff members but we decided to increase the number following a projected increase in demand. Each of the departments in the organization has its own budgetary allocation. The budgetary allocation for each department is meant to cater for departmental expenses. Wages and salary forms the main portion of the departmental budgetary allocation. With the current 30 staff members, the department has been able to handle all its duties. However, not all duties have been handled perfectly despite the big number of employees. The department has been having excess number of employees resulting into redundancy. In addition, the departmental staffs have been complaining of low salaries and allowances. The inability of the department to handle scarce resource is the main factor that has resulted into complains about low salaries and wages. This has mainly resulted from the increasing inflation and cost of living. The average salary for teachers has been $22, 300 for the last five years. Although the salary is almost equivalent to the basic salary for teachers in the United States, the teachers in the department claim that the salary is not competitive. The current salary allocations are below salaries paid to teachers working in other private schools. In order to increase the teacher salary by a significant magnitude, the department needs to restructure its members of staff. The restructure will involve eliminating six positions, which will account for about 20% of all job positions available in the department. Out of the six employees, other departments will absorb three while the remaining three will be encouraged to look for employment elsewhere. In addition the laid off workers will be encouraged to enroll in vocational training in order to remain relevant in the current job market. Following the restructuring, the basic teacher’s salary is expected to increase by 12%. The department is also looking forward to cut redundancy by 40%. Reducing redundancy will ensure that all workers are busy in their current position and none of the workers is irrelevant. The department hopes to increase its saving by 10%. This savings will result from the annual budgetary allocation for each department. As the head of the department, I expect each worker to have adapted to the new changes within three months. The department is expected to be fully operational and self-reliant within a period of two months. This is the time needed for the department to stop relying on assistance from other departments. I expect to have settled all difficulties resulting from the change of positions for each worker working in the restructured department within a period of two months. Such cases will arise from the inability of workers to take up new positions and challenges resulting from the new roles. A sufficient and viable action plan will also elaborate how the department will achieve its objectives within the specified period. In this case, the department hopes to achieve optimum operation within a period of one month. The main objective is reducing the number of employees working in the department by 20%. Secondary objectives include raising salaries and reducing redundancy. Firstly, the department will evaluate the relevance of current workers to the department according to the current roles. The evaluation will consider the significance of the work done by a specific worker and its future. The possibility of applying technology will also be considered during the evaluation. Secondly, I will grade the roles (positions) available in the department according to their relevance and possibility of technology substitute. This categorization will also consider the relevance of each position to the other departments. The next step will be to identify positions that have low scores according to the rubric. After identifying six positions with the lowest score, the next step will involve identifying the concerned workers. A refined evaluation will also be required in the identified six positions to establish individuals who will be laid off and those who will be absorbed in other departments. This will be followed by issuing letters to the concerned workers informing them about the decision. The letters will inform the concerned workers about the decision and request them to report to the office for further information. Workers issued with the notifications will be required to comply within one week. Laid off workers will be paid the first installment of their compensation package within three weeks. The remaining workers will be required to take additional roles to compensate for the laid off workers. This adjustment will take about 3 months and it will include training and seminars. Rationale for the Final Decision There are various decisions that influenced the decision to reduce the number of employees in the department. Although the main decision resulted from the current financial constraints, the decision was also in the interest of the workers. The third factor that influenced the decision was the role of technology in modern organization and the needs to adopt technology in the department. According to Fleischman, & Heppen (2009, p.107), “adoption of technology is a challenge for workers working in a certain organization despite having long-term benefits.” The decision to restructure the department was effected in order to reduce redundancy and increase workers’ salaries. The cost aspect was the main factor that necessitated the restructuring (Milton, 2008). This is because the department was incurring heavy cost to maintain its workforce. In addition, the department was not setting aside funds for future improvements and projects. Selection was based on the role of current workers in relation to their pay packages. In addition, the lay-offs were implemented with the consultation of the IT department. According to the head of the department, some of workers are likely to become fully redundant following the ongoing automation process. With the current level of technology, the department can operate with 80% of its current staff members. The other factors that necessitated the restructure are the need to pay competitive salaries to workers. It is evident that the government has not increased its allocation to the school in line with the current levels of inflation and rising cost of living. This indicates that each department has the responsibility of ensuring that all workers receive competitive salaries. The department also requires investing and purchasing of the necessary equipment to sustain its operations. The department also needs finances to fund research at the departmental level. Finally, the restructuring was done for the interest of the workers. It is evident that the ongoing automation of operations in the organization would render some of the departmental workers jobless in the near future. Thus, the restructuring was based on the welfare of the employees. The layoffs were also meant to encourage the employees to reconsider taking alternative careers and vocational training. Effect of Layoffs on the Budget The layoffs will have a significant effect on the departmental budget. After a three months period, the department will have cumulative funds resulting from the unpaid salaries and wages. This indicates that the department will have bigger budget and hence extended responsibilities. After full restructuring, the department will experience 16-18% increase in its total revenue. This increase will result from a reduction of expenses following the layoff and transfer of workers to other departments. The department will use 60% of the accrued funds to increase the salaries of the remaining workers. Each member of the department will receive a salary increase of about 20-30%. The department will engage in other short-term and long-term projects aimed at improving the welfare of its workers. Long-term projects will involve training of the remaining workers to enable them manage their current positions and avoid future layoffs. On the other hand, short-term projects will include intensive training programs and purchase of equipment. Automation of the department will also be considered as both a long term and a short-term project. The department will also use 5% of the accrued funds to form an insurance kitty to cover future retrenchments. Layoff Communication Information about layoffs is not good news to any employee. According to Harzing, & Ruysseveldt, lay off is the most scary to employees working in the current economy (2008). Hirschey (2009) is of similar opinion although his analysis only considers the reasons why employees consider layoffs as bad news to employees. As stated by Alas (2007), employees should consider improving their professions through training. According to the two authors, breaking the news about layoffs should be handled in a professional manner. In addition, the department will need to assist the employees as they seek other opportunities or alternative training. After analyzing my plan to make sure that it is viable, I will communicate to the affected employees through personal letters. At this stage, the affected persons will require to report to my office for further consultation. I will also request for a departmental meeting whereby all members are expected to attend. The meeting will have a general focus on the plan and the significance of our employees to the department and the institution. The meeting will also enable the employees to cope with the outcomes of the proposed restructure. Affected employees will require reporting to my office as proposed in their personal letters. Firstly, I will inform the affected employee about the status of operations in the department. I will also inform them the risk that faces them and the department if we do not take drastic measures immediately. For instance, I will inform them that their current positions are likely to be overtaken by the current progress in technology. In addition, I will let them know that the department is likely to experience financial crisis if we do not make the appropriate changes. At this point, I will request them to state their opinion concerning the issue. “It is evident that most people tend to consider their personal interest” (Triandis, 2009, P. 17). Those that are of negative opinion will require further information and counseling to enable them handle the outcome. On the other hand, those that will support the layoff will be requested to make a formal request for their layoff compensation. The other categories of affected employees are those who will be absorbed by other departments. Those that will be absorbed by other departments will be required to attend introductory training before been absorbed into their new departments. Employees that will have a positive opinion about the layoff will be requested to make a formal application for their compensation and clear any outstanding issue before they are fully deregistered from the department. I will also advise them to enroll in various training program particularly those related to information technology before seeking alternative positions. Conclusion Due to the current economic constraints, restructuring of the department is inevitable. In order to retain a sustainable number of employees I will require having an action plan that will retrench 20% of the current workforce. The reasons for the restructuring will depend on the available income and anticipated reduction on the department’s expenditure. Concerns about the future of the employees are the other factor that will influence the retrenchment. Although the decision to restructure the department will have long term benefits, most of the workers are likely to be influenced by the short-term effects of layoffs. Thus, I will need to communicate the news about layoff cautiously and professionally. References Alas, R. (2007). Organizational Change from Learning Perspective. Problems and Perspectives in Management, 5(2). Concoran, T. & Silander, M. (2009). Instruction in high schools: The evidence and the challenge. Future of Children, 19, 157-183. Harzing, A. & Ruysseveldt, V (2008). International Human Resource Management. London: Sage. Hirschey, M. (2009). Fundamentals of human resource management. Boulevard: Cengage Learning. Fleischman, S. & Heppen, J. (2009). Improving low-performing high schools: Searching for evidence of promise. Future of Children, 19, 105-133. Milton, R. (2008). The nature of human values. New York: Free Press. Triandis, H. (2009). Individualism and Collectivism. Boulder, CO: Westview Press. Read More