Interim HR Management: Case studies
The following case studies reflect our unconventional approach and describe the efficiency of our solutions in helping clients untangle adverse situations. Confidentiality is important to us. For this reason, our case studies do not reveal identities or allow conclusions.
Facing necessary cost-cutting measures European-wide, an international electronics company decided to close down one of its manufacturing plants, outsourcing local production to other facilities in both Europe and overseas. In line with applicable legislation, and under prevailing business circumstances, the situation eventually required the notification of such closure not only to the workers’ council but also to the employees. On that occasion, we were called upon to negotiate and conclude a shop agreement (redundancy scheme) with both union and staff representatives. As the company operates within a very narrow niche of the market, its role as a supplier was of key importance to a number of major technology manufacturers. To prevent damage to the company’s reputation, and avoid customer claims for compensation, it was imperative to sustain production completely – quantitatively and qualitatively – during the five-month interval between notification of closure and the definitive closure of the plant. We proceeded as follows, with success:
- Concluded a labour-management contract for balanced redundancy compensation, accompanied by an adequate set of incentives tied to positive manufacturing performance during the closure process.
- In collaboration with workers’ representatives, agreed on a gradual, well-organised staff reduction scheme, coupled with a structured shift of manufacturing operations to other production facilities, in parallel with a plan relating to the closure of the facility.
Due to a transparent negotiation process, followed by likewise transparent results, the manufacturing plant was eventually closed without affecting customers’ best interests, without any public intervention, on time and within budget.
Backed by a financially strong investor, a medium-sized mechanical engineering enterprise with several hundred employees acquired its chief regional competitor of roughly the same size, which had previously belonged to a steel conglomerate. The previous owner of the acquired firm had managed all key organisational tasks on behalf of that firm (HR, Legal, Finance, IT etc.). After a brief period of transition following the deal, these services were no longer available. As the acquiring firm lacked adequate capacities to deal with the acquired firm’s key tasks, we were called into the project. Among other assignments, our job was to set up an efficient HR organisation within a few weeks, with a payroll system covering the recently acquired firm of about 800 employees; our next assignment was to structure and standardise processes so as to facilitate the buyer’s unhindered incorporation of the firm within a year from the purchase. We accompanied these measures by extensive analyses, which helped to put all acquisition-related efforts for creating synergy into effect as planned. All performance parameters were successfully implemented on a timely basis.
The group was heavily hit by the international financial crisis. Over the past months, orders from the automotive industry had slowed down by more than 50%. As prospects for the future were bleak and gloomy, nobody dared to project if, and when, order books would be full again to boost production. After a long struggle trying to grapple with the situation, the Management of the automotive supplier settled for significant capacity cuts in several plants. The target for the plant we were asked to take care of was to cut 34% on personnel costs. Complying with legal conditions and under our guidance and management, a redundancy programme was worked out between the plant Management, the union and the work council. The programme would have implied redundancy of more than a hundred people. Because of the remote geographical location of the facility and lack of other job opportunities, the redundant workers would have been forced to relocate to other parts of the country; consequently, they would not have been available if orders picked up. In that case, the region would have lacked skilled workers to act as replacements. For this reason, we initiated talks with public institutions, staff representatives and the Management at a very early stage, while we conducted negotiations for a redundancy plan at the same time. These talks aimed to ensure temporary leave of absence for a considerable number of employees. Together with the company’s promises for re-employment following such unpaid leave, we thus managed to adapt the number of plant workers to the prevailing demand. With financial participation of the public sector as well as the workers, and by tapping all of the company’s other resources for potential savings, we managed to prevent layoffs and consequently avoided the implementation of major parts of the redundancy plan