STRENGTHS AND WEAKNESSES TO JOHN CRANE FLEXIBOX’S DOWNSIZING

STRENGTHS AND WEAKNESSES TO JOHN CRANE FLEXIBOX’S DOWNSIZING

INTRODUCTION

John Crane Flexibox, world leader in its field, is the result of a merge in the summer 1998 by TI Group Plc. division, John Crane and EIS Group they took over, Flexibox. As a business, its aim is to be on the top in their chosen market by enhancing its market share, quality and reputation. (Mitchell L., 2000) Due to John Crane and Flexibox overlap after the merge, they had to experience decreasing sales. The organisation had to attempt on reducing its costs and therefore to improve efficiency by thinking of downsizing. Its Human Resources department pursued a realistic perspective close to a ‘personnel’ function and additionally guessing the UK law expectations. This essay will analyse and evaluate the approach to downsizing embraced by John Crane Flexibox in relation to relevant academic readings.

KEY STRENGTHS TO DOWNSIZING

Downsizing execution for John Crane Flexibox is an opportunity to deal with the overlap issues that have aroused, after the merger act, as those two divisions were supplying for the same market, manufacturing identical products and adopting similar methods of sales, service and research. (Mitchell L, 2000) The results of downsizing in this case were that it led to eliminate all unnecessary costs and reducing fixed costs like employees wages. (Hornstein, 2009)

That is to say, downsizing was seized as a cost saving performance in times of tight market orders. (Luan et al., 2013) In this context, it was primarily thought as enhancing organizational efficiency, to reduced cost savings and expenses. (DeWitt 1998, Freeman 1994, Harrigan 1980) For some organisational theorists (Burns and Stalker 1961, Butler et al., 2009), downsizing was generally viewed as a natural path in order to develop a business enterprise. For others like Nantaporn Makawatsakul and Brian H. Kleiner, remaining employees known as ‘survivors’ felt a sense of self worth if the company was applying a good communication about the decision to lay-off. Employees can feel a sense of reward that can build up loyalty and commitment towards the organisation. (Torrington et al., 2011)

Moreover, JCF HR department made sure to apply an effective communication to their staff leader and employees before and after downsizing via “weekly communication bulletin (mail), team meetings and the consultative committee.” (Mitchell L, 2000)

On the one hand, we cannot deny that downsizing benefits the company to reduce costs. On the other, some searchers suggested that downsizing produces considerable dysfunctional consequences, including the decline of service quality and innovation, and employees’ “survivor syndrome”, as expressed in increasing anxiety and risk aversion (e.g. Brockner and Wiesenfeld, 1993; Cameron et al., 1991; Cascio, 1993; Hui and Lee, 2000) and that is why JCF kept downsizing as a last resort to “eliminate all unnecessary costs and expenses”. (Mitchell L, 2000)

KEY WEAKNESSES TO DOWNSIZING

JFC decisions regarding downsizing were made in collaboration between the Managing Director and the Board of Directors where we can observe that they choose to reduce cost straight to people working at the bottom of the firm without even thinking

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