Making Human Resource Decisions

Scenario:

You are the Director of Human Resources for your company. TheCEO has just informed you that the financial state of the companyis dire, and as a result, he is approaching the managers of eachdepartment and asking them to reduce personnel costs. The companymakes its profits primarily on services such as businessconsulting, cloud-based storage for large companies, and othersmall miscellaneous business products. The industry has becomehighly competitive and sales are down. There is not enough revenueat this point to pay all of the salespeople.

You are charged with devising a plan to determine how personnelcosts will be reduced. After much deliberation, you decide on threeoptions. Because this is a management dilemma, none of theseoptions are optimal. Further, cost/ benefit analysis has a role inthe decision making process, but as you are dealing with people,this type of analysis is complicated and subjective.

Options:

  1.  Lay off employees and use them only asneeded on a project or change employment structure (i.e. move someemployees to independent contractors)

  2.  Reduce salaries across the board

  3.  Reduce hours and/or benefits forlower-level staff

Instructions:

Choose one of the above options and defend this decision. Useconcepts from the chapter to defend your decision.