Today, on Tuesday, July 19, 2005, Hewlett Packard did as expected; they announced that they would distribute 14,500 pink slips. The company will reduce one-tenth of its worldwide work force over the next 18 months. HP claims this restructuring plan will result in a $1.9 billion annual savings. Shareholders applaud the decision; employees do not.
The company also made known, as of January 1, 2006, it would no longer contribute to the pension plans of its domestic workers. Oh joy, oh bliss. Newly appointed, company President, Mark V. Hurd is following the lead of other corporate heads. Hurd saw GM Chairman and CEO, Rick Wagoner do his dance and he thought he would join the hustle.
President Hurd declares this move will create “a simpler nimbler company.” Schticks are simplistic and shortsighted. Yet, they are the preference of American corporate leaders.
US companies cut cost to garner gains. They do not consider that while there may be short-term increases, in the long run, the global community will suffer. It is people that purchase printers; consumers buy computers. Cars cannot leave the showroom floor without a driver and drivers need cash to claim their vehicle. Without jobs, without income, even without a sense of security, shoppers do not shop.
American firms concentrate on the immediate future, and then, ultimately, they flounder; many fail. Companies dismiss or diminish the importance of their own employees; they cater to Chief Executive officers. It seems, for a time, that these measures are winning strategies. However, they are not. These tactics bring in profits, though these earnings are short lived.
Toyota can claim a business-intelligence that reaps greater rewards. Their corporate culture, kaizen, or the Japanese business philosophy demands an attentiveness that differs from that of American organizations. Kaizen requires obsessive cost controls, relentless thoughtfulness, and equality. Executives are not considered greater than employees; they share. Japanese industrialists care. Rather than cut labor and benefits, they build relationships. Wow, what a concept!
This way of thinking is contrary to that found in American industries. Sharing status, ideas, and revenues is not the American way. Yet, it is the standard in Japan. Businesses such as Toyota are successful; their success is substantial. If only Hewlett Packard, General Motors, IBM, and other American capitalists would consider similar strategies. They too might harvest greater manufacturing health!
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