Geof Fountain discussed the views held by Ely Goldratt. . .
> Goldratt suggests that reducing costs by laying people
>off not only breaks a management responsibility to the employees, but is a
>short-term quick fix as well since the ability to reduce costs is limited.
Geof added that
>Maybe ten or fifteen years from now we will look back on all the
>downsizings in the late 80s and the 90s wishing if we had only learned how
>to do better before that time.
We have to remenber that many layoffs do not happen in the spirit of
reducing costs and as a short-term quick fix.
Many are driven by a change in the company's business model, often brought
about by competitive forces, benchmarking and/or core capability type
analysis. I was in one company that basically decided to get out of
component level manufacturing and thus did not need those jobs associated
with it.
All the foresight in the world would not have changed the layoff decision.
Geof also asked:
>There are some questions in my mind though. If the strategy is to seek a
>dominant competitive edge, that means others are losers. Is it only the
>winners that avoid the downsizings ? As long as the strategy includes the
>word "competitive", we will always have winners and losers (and therefore
>we will always have downsizings). Doesn't the word "collaborative" have
>some use in this strategy ? Or is that wishful thinking ?
Firstly, there are sitautions where sometimes the winners become winners
by changing the business model and the decision in itself that could
include layoffs. Secondly, in most markets there is, or will be, a total
market as the market matures or demographic and social patterns cause it
to change. Therefore, companies are competing for market share and would
be unwilling to collaborate. Unfortunately, in certain situations where
there has been "collaboration," -- such as in price fixing -- the consumer
has been the loser.
However, there are examples of collaboration in emerging markets. The
computer industry has a history of collaboration on standards. The
audio-video industry recently collaborated on determining the standards
for the new digital video disk. These industries have learnt from such
experiences as the VHS/Betamax standard wars, in the early days of
consumer video. Such wars confuse the consumer and delay the growth of the
market. They also expensive for those needing to support more than one
standard.
Nevertheless, once these standards issues are resolved, the companies move
back into fighting each other to gain market share and it is hard to
envisage any accepable arguments for collaboration in these areas.
-- Peter A. Smith Orbis Learning Corporation 74363,3637@compuserve.com"Individual learning is a necessary but insufficient force for organizational learning." Argyris, C. & Schon, D.A.