HUMA 1745 Lecture Notes - Lecture 27: American Express, Barista, Starbucks
1 May 2018
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HUMA 1745 Lecture 27 Notes – Organization Downsizing
Introduction
• American Express claims to have been doing this in a series of layoffs over more than a
decade
• 7700 jobs in 2001; 6500 jobs in 2002; 7000 jobs (10 percent of its workforce) in 2008
• 4000 jobs in 2009.
• The ut of jos 8. peret of the reaiig orkfore represets its
iggest retrehet i a deade.
• Each layoff has been accompanied by a restructuring to reflect changing customer
preferences, away from personal customer service and toward online customer service.
• Aordig to CEO Ke Cheault, these restruturig iitiaties are desiged to ake
American Express more nimble, more efficient and more effective in using our resources
to drie groth … ad to aitai arketig ad prootio iestets.
• Some companies focus on lean management techniques to reduce bureaucracy and
speed decision making.
• For example, Starbucks adopted lean initiatives in 2009, which encompassed all levels of
management and also focused on faster barista techniques and manufacturing
processes.
• Customers have generally applauded the shortened wait times and product consistency
at this well-run corporation.
• Starbucks continues to reap returns from its lean initiatives, posting notable revenue
gains each quarter.
• Despite the advantages of being a lean organization, the impact of downsizing on
organizational performance has been a source of controversy.
• Reducing the size of the workforce has an immediately positive outcome in the form of
lower wage costs.
• accompanied by a restructuring to reflect changing customer preferences, away from
personal customer service and toward online customer service.
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