Downsizing 10 per cent of the staff

It may seem that the most complicated task an HR manager faces is finding and hiring a new employee who will meet the requirements of the workplace and the expectations of the company. However, making a decision about dismissing staff members turns out to be extremely challenging as well, especially when this necessity is caused not by an employee’s bad performance but rather by reduction of the company’s size, budget shortfalls etc.

The situation is aggravated by the fact that there is no single correct approach to decision making connected with downsizing. It may seem to be the optimal decision to be guided by centuries-old principles of classical economic theory that implies comparison of expenses and effect.

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From this perspective, it is reasonable to dismiss a 45-year old manager with average performance who has a high salary due to the substantial work experience rather than a 26-year old high-flyer performing higher than average (Segalla, Jacobs-Belschak & Muller, 2001, p. 60).

However, when analyzing the situation from the perspective of “distributive justice”, it may seem to be inappropriately to dismiss a loyal 46-year old employee who is unlikely to get a good position at another company and keep a young ambitious employee who may leave the company at any moment and will easily find a job (p. 62).

To solve the contradiction, I find it reasonable to focus on not “whom to dismiss” but rather on “whom to retain”. It is necessary to analyze the company’s goals, mission, corporate culture and answer the question: what staff does it need? Does a company need young energy and innovations? Or does it require loyalty and experience? Having analyzed all important factors, it is necessary to compose an evaluation form and rate the “candidates” for dismissal.

The following criteria may be included: performance, potential in the company, experience, loyalty, chances to find another job, experience, involvement into the corporate culture, clients’ feedback (or student evaluation in case the company is an educational organization) etc. It will be much easier to make the decision about the dismissal based on the results of this assessment.

References

Segalla, M., Jacobs-Belschak, G., & Muller, C. (2001). Cultural Influence on Employee Termination Decisions: Firing the Good, Average or the Old? European Management Journal 19(1), 58-72.

TOPIC 2 Interview with a person in charge of financial management system

I visited the School and interviewed Name Surname, a school financial manager. The focus of my interview was the manager’s professional experience and skills, her responsibilities at the workplace; peculiarities of financial management at School and the challenges the manager faces.

Interview

1. What stages have you taken at your career path? How have you become a school manager?

I am a college graduate in accounting. After finishing education, I got a position of an accounting assistant in a hospital in Brownsville. I spend 1.5 years at this job. When I came here, I got the position of an accountant in the School 1 and worked there for 3 years. To switch from medicine to education, I took a training course and studied school accounting software. After that, I was lucky to come to this school as an accountant and, having worked 2 years at this position, I became a financial manager.

2. What is the key difference between the positions of a school accountant and a school finance manager?

When being an accountant, you are responsible for calculating, registering, keeping records, reporting etc. Being a financial manager is more about making decisions. A financial manager has a range of options concerning each issue that arises in the school’s everyday life, and he or she has to make an optimal decision. The most effective one.

3. What decisions are the most difficult to make?

Well, limited funds make all decisions quite difficult. According to the statements of economic theory, needs are endless and resources are limited, which always makes a decision maker think hard. Of course, this is about our school as well.

4. What are your decisions based on?

They are based on the current problems the school needs to solve. A school always has a big range of problems – or at least a range of issues to solve. I fulfill finance management based on the principal’s vision of the current situation. She defines the priorities, and I bring these ideas into life.

5. What about long-term strategy? As a financial manager, do you develop a strategy for the school’s finance?

Well, strategic planning looks good on the paper, in finance management student books. However, in the real life, it is very difficult to plan anything for a long period. Life brings new needs and new expenses, and the principal also tries to be flexible in order to react to the current challenges appropriately.

6. What software do you use in your finance management system?

Recently we have introduced the TIES Finance system. The school is quite big, and we needed to make our accounting and finance management convenient and effective. It took me and the accountant certain time to get familiarized with this software; however, now I am confident this change has been worth doing.

7. Do you have any plans for improvement of the school finance management system?

Well, despite there is always something that you may improve in anything, I think at the moment financial management at school functions well. We work in accordance with the federal standards and the framework provided by the district authorities.

I believe we distribute funds effectively. Our accounting and reporting is kept in order. We are ready to meet audits and demonstrate that funds are received and spent appropriately.

Analysis

The manager has mentioned that financial management is not equal to fulfilling routine accounting actions; it implies doing investigations, analyzing the status quo and making decisions aimed at improvement of the school’s finance. However, it seems that Name Surname stays an advanced accountant rather than a financial manager. She does not fulfill long-term planning focusing on the short run.

The manager is unwilling to take the initiative in decision making in the field of finance; she prefers to listen to the principal’s opinion on the priorities in allocation of funds. Instead, she might provide the principal with a fund allocation rationale based on the analysis of school curriculum.

The manager should outline her rights and responsibilities in detail. She needs to undergo a professional training for finance mangers in order to learn the opportunities she has considering her position.

As for the routine actions, accounting and reporting is conducted appropriately and in time. The software used at the school makes it simple to control cash flaws, inventories and fulfill other procedures. The manager also fulfills finance management efficiency analysis: she creates a report where she shows the directions of fund allocation and its effectiveness. The report is presented to the principal.

Topic 3 Stress reduction programs

There are different approaches to reducing stress level in an organization. To choose the appropriate program, it is necessary to assess the available options based on a range of criteria, such as: current stress level, aims of a stress reduction program, a number of staff members involved into the program, time necessary to complete a program, cost of a program and oth.

Given I am in charge of stress reduction in a school, I need to help teachers cope with stress caused by their job responsibilities, intensity of their work, and communication with colleagues, supervisors and students. Below three different programs are analyzed.

1. “Stress-Free Zone”

This approach is often used by many large companies. For example, in (Carlaw, Carlaw, Deming & Friedmann), it is described how the stress-free zone was applied at SAT Campbell Software (p. 92).

NameStress-Free Zone
Individual/groupGroup
ContentIntroducing a space where employees can relax and have rest. In this zone, they do not talk about work; they discuss general issues, have snacks and play games.
AdvantagesUnlike a program designed for a short period, the zone works permanently. Besides, the cost of the program is minimal: it is necessary just to equip the room where the stress-free zone will be located.
DisadvantagesThe approach is very general and does not imply solving certain specific problems that may occur in the team. It just provides a means of quick stress reductions and relaxation.