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Social Cause Marketing - The Regis Group Inc

Social Cause Marketing - The Regis Group Inc

INTERVIEW Following Mr.

INTERVIEW Following Mr. Barack Obamaís economic stimulus package, every government has followed the suit. Itís more than four months since those packages were announced and disbursed (at least partially). But the recovery seems to be getting delayed beyond expectations. When do you think people can expect a positive recovery from this downturn? Stimulus packages, especially large packages, will take some time to have an impact. Here we are not talking about one company and its people. We are looking at a nation with diverse needs and sectors. I think, in India, a certain amount of recovery is on its way. 2010 will overall be a tough year which we have to find ways to ride out. In the Western world where the impact has been far higher, the recovery time will also be longer. At the beginning of this century, every where there was talk of talent management prophesying time and again that people are the key assets. And everyone complained of talent crunch. Now that there is cash crunch, in the name of either managing a downturn or restructuring, every company resorts to sacking the employees mercilessly. In fact, some CEOs advocate their divisional heads not to be emotional and sentimental and take a knife and chop off. Why this U-turn? I would not agree with you here. Let us not get taken in by a few newspaper reports here and there. Yes, some of what you say may have happened, but it is difficult for us to appreciate the position that those people may be been in at that time. I reiterate that people are our asset, and our key asset ñ there is not doubt about this. In that, talent is the most priceless commodity. The next is the fit between talent and the requirements of the job. These will continue to be any HR managerís challenges going forward. What happens to all such companies resorting to massive layoffs as regards image and long-term standing? Do you think people would excuse them for being treated as inanimate objects especially during such trauma times? Companies in dire straits have had to resort to such measures; this has not been a rule across the board. It would be good to hear more about those who have persevered to protect and even enhance jobs at this time. And there are many companies who have, including Apollo Tyres. But you are right there is an immediate image issue that companies face in such situation. The only upside, or even downside if thatís how you prefer to see it, to this is that when performance is good, public memory is short. Even giving benefit of doubt to the companiesí pursuing lay off policies, what happens to the morale of all those who fortunately manage to survive (because they happen to be the ëbestí employees) and hold on their existing jobs? Can companies expect best performance from their ëbestí employees? You are right. Such actions not just have an impact on those leaving but also leave a psychological scar with those remaining. Actions such as those you mentioned, if not managed properly and communicated well, often result in the best people leaving immediately after the downturn is over or as soon as they get another job. And of course it affects morale of all employees and creates a feeling of insecurity. Do you think layoff is the only answer to manage the downturn? Geoff Colvin argues (Fortune, March 30, 2009) that the costs of a layoff ñ Brand equity costs, leadership costs, morale costs, Wall Street costs and rehiring costs ñ should be guarded against. Given these inevitable costs and costsaving-exigencies, what do you think should be a companyís policy towards layoffs? As I mentioned earlier, every situation brings its unique circumstances. For some may be, a certain amount of layoffs was the answer. This could indicate also that the company was carrying more people than it needed to ñ and that can be for various reasons ñ and therefore it was imperative to take this action. Our way has always been to look at various options. At Apollo, we have used two methods extensively ñ redeployment and scaling back on manufacturing. We redeployed people across functions and locations and also decreased the total days of manufacturing to enable us to keep both manpower and inventory costs low. People are trading off their jobs for wage cuts and other measures. What is the efficacy of other job saving schemes like shifting to shorter working hours, temporary work suspensions at factories, work-sharing programs and lower pay in exchange for tacit job guarantees? The bigger question however is can they be sustained? Exactly what I am talking about. These are all measures that can be deployed during tougher times when the production volumes required are lower than usual to ensure gainful employment. And yes they can be sustained for a period of time to tide over tough times. However, as you will understand these are not measures that are required when goods are selling and production is working on full capacity. Cutting working hours also adds to the bigger macroeconomic problem currently hammering the world economy: lack of demand. Pay cuts eat into consumer spending, which in turn amounts to more bad news for a world economy in need of stimulus. Therefore, how do you expect the government and the companies to make concerted efforts to make sure that oneís solution does not become anotherís problem? Or is it inevitable? In todayís world not only is the personal related to the economy but also one nation to another. Today we live in a far smaller world and nothing takes place in isolation. Some of this is inevitable. However, if you see how the Indian government has acted, we have a lesson here. It has tried throughout this period of bring down inflation, SEPTEMBER 2009 72 EFFECTIVE EXECUTIVE

City Union Bank SEPTEMBER 2009 73 EFFECTIVE EXECUTIVE

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