Chapter 18 Human Resources in Entrepreneurial Firms Gary Dessler "Human Resource Management" 14th Edition essay sample

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Human Resource Management in Small Firms

Economic downturns, such as the 2008 recession, have adverse effects on all sectors in a country. Economic recessions are usually characterized by low consumer demand, spending levels, and high unemployment rates. On the financial sector, downturns are synonymous with high-interest rates and default rates as borrowers are unable to repay their mortgages. These downturns affect both big and small businesses as consumers became worried about their future economic situations thereby, preferring to cut their spending levels.

Under these extreme economic situations, consumers prefer to spend only on basic commodities. In the process, small businesses such as retail shops, restaurants, and hotels, as well as service sector businesses such as dry cleaning companies are always affected. Carter Cleaning Company is no exception. With its stores revenues and customers plummeting due to the recession, the company had to develop strategies to alleviate the adverse effects of the recession. Cost-cutting strategies, especially in the non-core business segments, is necessary for organizations such as Carter Cleaning Company to cope up with the adverse effects of the economic downturn. Since human resources are major contributors to organizational costs, changes in human resource management are mandatory for organizations that seek to revert back to profitability after an economic downturn.

One of the necessary work-scheduling changes that Carter Company need to adopt is reducing the number of permanent employees. The company should employ more workers on a part-time basis without necessarily firing them. This move will enable the company to introduce a per hour payroll where employees are paid depending on their working hours. Introducing part-time working schedules will entail amalgamating related departments. Only departments that operate on a 24-hour basis should have permanent employees. However, due to the declining number of customers, the company can consider adopting operating schedules for various departments. For instance, the customer desk department charged with registration of customers’ details as well as commodities that require cleaning services should operate for longer hours than other departments. However, the automated dry cleaners must not operate for 24 hours.

Due to the declining number of clients, it would be prudent to restart the machines only when there are numerous goods for cleaning. As such, workers operating these machines can work on a part-time basis reporting to work when the computerized dry cleaning machines are operating. As Cooper & Burke (2007) explain, part-time work schedules will enable Carters Company to reduce labor costs without reducing the number of workers. Other changes in the work-schedules necessary for Carters Company would involve studying clients’ trends then introducing work shifts during these peak periods. For instance, the company would analyze the days when the demand for cleaning services is at its peak. Thereafter, the management can tailor its works shifts to meet the expected increase in the number of customers. During the onset of holiday seasons such as Thanksgiving, Christmas, Easter among other holidays the company is likely to have a surge in the number …

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