GM Inside News Forum banner
1 - 8 of 8 Posts

·
Registered
Joined
·
1,514 Posts
Discussion Starter · #1 ·
GM Signals More Cuts

Automaker will meet or top target to reduce salaried employment costs by 20%, but signals that additional cuts needed due to worsening sales.

NEW YORK (CNNMoney.com) -- General Motors expects to meet or exceed its target for a 20% reduction in the cost of its salaried workforce, but a worsening sales outlook is likely to force additional cost and staffing reductions, a company spokesman said Thursday.

Final numbers on an early retirement program announced this summer are not yet available, said GM spokesman Tom Wilkinson, as many who signed up are still within a window during which they can change their mind. The final figure is due on Nov. 1.

GM has 32,000 U.S. salaried employees, and since it has set a 20% cost target rather than a headcount reduction goal, it has yet to say how many employees it expects will be leaving the company under the program. The company has previously announced some changes in health insurance for salaried staff that will meet some of the cost cut target.

http://money.cnn.com/2008/10/23/news/companies/gm_cuts/index.htm?postversion=2008102309
 

·
Registered
Joined
·
8,869 Posts
its a shame.

my question is with all the people let go.. how can they get any work done.. i mean really.
Speaking to the issue of work getting done, the answer is simple: some of it won't get done. I spoke with someone who works out in the field, and she suggests the territories that field reps are going to have to monitor is going to get beyond unmanageable. That's a shame, because I think one way in which GM has done reasonably well is customer service. Less people addressing this important issue is not a strong long-term strategy.

I [thankfully] do not own a GM dealership, but this field rep notes that some dealerships she used to service have raised concerns that it's not even that they don't see their sales and service reps enough... they can't even identify who they are anymore: "We have a sales/service rep?" Again, that's not a good long-term strategy.

I understand the need to cut costs, particularly when the ship is sinking, but I hope they can be a least a little more thoughtful about how to most judiciously dispatch limited resources.
 

·
Registered
Joined
·
260 Posts
Speaking to the issue of work getting done, the answer is simple: some of it won't get done. I spoke with someone who works out in the field, and she suggests the territories that field reps are going to have to monitor is going to get beyond unmanageable. That's a shame, because I think one way in which GM has done reasonably well is customer service. Less people addressing this important issue is not a strong long-term strategy.

I [thankfully] do not own a GM dealership, but this field rep notes that some dealerships she used to service have raised concerns that it's not even that they don't see their sales and service reps enough... they can't even identify who they are anymore: "We have a sales/service rep?" Again, that's not a good long-term strategy.

I understand the need to cut costs, particularly when the ship is sinking, but I hope they can be a least a little more thoughtful about how to most judiciously dispatch limited resources.
Less people with the same amount of work leads to more innovation. Is it still a surprise that things can not be done the same way forever? The US is about to go through a huge increase in management productivity and when things settle out, the country will be much stronger.
 

·
Registered
Joined
·
159 Posts
Could they be making room for some of the best employees from Chrysler?

I will say that I worked for a major oil company that followed the same business model, it does not work! Short term gains at the expense of business growth and profitability.

In my case, the business unit I worked for was sold off. The reason given was a smaller company could be more locally focused on the business and customers. We were locally focused until they reduced head count and expanded territories to the point they were unmanageable.

Looks like they will be giving people more of a reason to buy imports!
 

·
Registered
Joined
·
78 Posts
Could they be making room for some of the best employees from Chrysler?

I will say that I worked for a major oil company that followed the same business model, it does not work! Short term gains at the expense of business growth and profitability.

In my case, the business unit I worked for was sold off. The reason given was a smaller company could be more locally focused on the business and customers. We were locally focused until they reduced head count and expanded territories to the point they were unmanageable.

Looks like they will be giving people more of a reason to buy imports!
You have it about perfectly right.

You can't downsize a company to success.

Of course, Wagoner knows this. He knows bankruptcy is inevitable. He is doing what he can for thousands of loyal GM workers, while he still can.

A little travelling money is better than none at all.

I remember when Robert Stempel got fired by the board. The scuttlebutt from the union was the board wanted deep employee cuts and Stempel refused, so they fired him.

Wagoner knew this, and was smarter than Stempel. First he secures himself a nice pension, just in case and then he agrees to "buyout" packages for employees. If the GM board doesn't like it, they can fire him.

Either way, Rick Wagoner can sleep at night, knowing he did the best for GM employees that he could.

Remember in a bankruptcy, there won't be any buyouts.

At least thats my take on things.
 
1 - 8 of 8 Posts
Top