Manpower right-sizing

Organisation Structure

Disguised Unemployment to Lean Performance

This is a story of a 50-year old mid-sized agro manufacturing company, with a turnover of USD 100 million. HR Anexi partnered with this organisation in various strategic and transactional initiatives, here is one that profoundly affected its bottom line.

Our initial diagnostics indicated the need for a comprehensive employee capacity utilization study. A ‘Time and Motion’ exercise was conducted, which mapped employee capacities to their day-to-day utilization.

The findings were alarming!

  • The company, in a bid to protect employee tenure, had lapsed into a practice of hiring two or sometimes even three employees to meet the varied needs of a single position.

The diagnostic study & analysis revealed:

  • Job descriptions and performance indicators were not well articulated
  • Most hiring was ad-hoc
  • Debilitating ‘hidden’ costs, ‘wastages’ amounting to almost 35% of the total employee cost!

Thus, the company initiated a right-sizing exercise, which matched people with specific roles and removed labour redundancies. The company put in place a robust performance management mechanism, based on mandatory job descriptions, clear responsibilities, and measurable performance indicators.

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Identifying the Productivity Gap