Insider's Perspective on Ford's Headcount Reduction Story

The Headline from Story originaly published on April 6, 2005, CLICK4STORY

Ford Offers Buyout to Cut Headcount by 1000 Jobs, Looks at Admin, Marketing and Advertising to Save Money

Snides Remarks; If you can eliminate 1000 workers and still fulfil your business' mission, why did you hire them in the first place? When biz gets good again will they be hired back? Is this all just bull for Wall Street? Please let me know msnide@theautochannel.com.

INSIDE SCOOP From A TACH Reader! April 6, 2005;

Dear Mr. Snide,

I was an employee of Chrysler Canada for over sixteen years from the mid- sixties through to 1981 and had the pleasure to experience a number of "Boom- Bust" cycles, with corresponding austerity ("PIPs") programs.

My observation of this process was that managers would typically inflate their head count, during periods of prosperity, to compensate for staff reductions, during lean times, while meeting the requirements demanded of their departments.

The managers who were conscientious and controlled their department staff to optimum eficiency, during periods of prosperity, suffered unfairly at a decision to have an arbitrary across- the- board, all- department cut of whatever percentage of staff that had to go. The impact of this type of decision was felt dramatically in the late seventies, at Chrysler engineering. Several years after the staff reduction, problems arose with product that had been in various stages of development.

There was a tremendous loss of talent and experience with the "survivors" sometimes muddling through issues that could have been resolved by more experienced staff, in a fraction of the time taken by those who remained.

The cost of "PIP" programs may result in immediate savings to fixed overhead; however, there is a cost that may well exceed the benefit and can emerge and linger for many years!

Roy Zimmerman

Thanks Mr. Zimmerman, our reaaders appreciate your insight, M.Snide.