An article published on 4th October 2015 suggests that the luxury car company Rolls-Royce is planning on reducing 400 management jobs in its marine division this week. Chief Executive Warren East’s aim with the marine restructuring will be to strip out management layers and rebase costs in a business that relies on an energy industry now hit by low global oil prices.
Roll-Royce plans on shifting its operation manufacturing from high- cost Scandinavian countries towards Asia, while retaining research and system integration in Northern Europe.
In my opinion this is a smart move by the organisation. Outsourcing the company’s operations could significantly lower costs for them. Asian countries like China and India have the cheapest labour in the world and since research and system integration will still be in Northern Europe the quality and class of the company is maintained.
But Rolls- Royce has a big task to do first, firing 400 people!
Firing that many people could prove to be costly, not only ethically but also financially. The amount the organisation will have to pay as a severance package for all the employees fired will be significant. Also setting up the manufacturing industry in asian countries would have a substantial initial cost. But I personally feel that they will recover this cost in no time given the benefits of moving to asian countries.
Lastly, the question that comes to our mind is if this is ethically wrong. Firing 400 people within a week may just be too much. After all the effort and time these employees have put into the company should be recognised and appreciated.
In conclusion, I feel that this decision will act as a major factor for growth for the company but might loose reputation considering the ethical implications of it.
REFRENCES:
http://ca.reuters.com/article/businessNews/idCAKCN0RY0VA20151004
