Workforce planning and the risk of excessive cutbacks

As part of their workforce planning, firms try to anticipate their future labour requirements and undertake an analysis of their existing workforce. This helps them see where there are gaps in their human resources and where training priorities need to be addressed.

My students have been going through this using the example of the HR implications of business expansion in the UK supermarket sector.

Of course, workforce planning for growth is one thing. Maybe more current is the depressing necessity for many firms to cut back on staffing. But this can go too far, as I read in a piece on Kellogg’s.

Apparently, Kellogg’s outlook suffers after axing ‘too many jobs’.

The firm has announced a $70m investment in its factories after too many job cuts undermined production quality standards. Now the US firm is recruiting 300 US plant workers in a bid to improve quality.

According to the BBC, Kellogg’s chief executive officer said the company “cut deeper than it should have” and is now hiring staff. The move follows a worldwide cull of staff in 2009, which saw an estimated 1,500 employees lose their jobs. But then in the summer, U.S. regulators found a bacterium that causes serious food poisoning at a Kellogg’s biscuit-making plant in Georgia and warned the company about “significant violations” of manufacturing regulations. That incident followed a recall of millions of boxes of cereal in 2010 due to an unusual smell, and a recall of some Special K protein bars in 2009.

One analyst observed: “It’s becoming clear that they have underinvested in the infrastructure of the company for some time. Now that underinvestment is coming back to bite them.”