Southern Recreational Company Case Study Review

Southern Recreational Company Case Study Review



Southern Recreational Company Case Study Review

Question 1

When the management team of the southern recreation vehicle company decided to relocate to a different area, they undertook a decision making process to determine the right place to set up the company. They resolved to move to a geographical area with favorable factors that would help them to solve the problem they were encountering at St, Louis Missouri.

They compared all the available incentives that various communities offered to them and settled on a decision to relocate to a small town in Ridgecrest Mississippi. This was due to the impressive inducements they were offered by the local and state officials in the town, which matched or were close to the requirements they had in mind before deciding on the perfect place to move. The officials had offered quite favorable conditions in an effort to attract large manufacturing firms and industries to locate within their geographical boundaries in order to boost their economic power.

Among the offered inducements included the exemption to pay the required taxes to the country as well as to the local municipal councils for a period of five years. The management team of the southern recreation vehicle company viewed this as a major resolution that would help them to track back the company, s declining profit margins back to normal. This is because in evaluating the problems that led to their downward growth records, they identified the issue of heavy taxations payment imposed on them by the local authority to be a major factor that prevented them to operate profitably.

Another inducement offered by the Ridgecrest town officials was the provision of free sewerage and supply of clean water. This would not only help the company to create a conducive work environment, but would also help to cut the company’s utility costs which was one of the target the management team in the company had planned to achieve. In addition, the officials offered to construct a cost free loading dock at the firm’s site which will save the company the construction costs they would have incurred and increase the efficiency and effectiveness in the operation of the company.

The Ridgecrest town officials also promised to offer financial boost to the southern recreation vehicle company as they agreed to issue an industrial bond valued at $500000 to help them to undertake expansions in the future. This was a major inducement as it would help them to raise their profit margins. Finally, since the company management team was looking for a location with qualified and adequate labour workers who exhibited positive attitudes, the Ridgecrest official’s final inducement would provide them with credible labour supplies as they offered to train personnel in a public financed industrial school who would acquire skill to work in the company.

Question 2

The initiative for a company to undertake transitions to move from an area with many manufacturing firms to a sparsely populated industrialization area is usually made as a strategy to help solve difficulties the company experiences in their current location. The relocation helps many companies to attain the desired state but it also comes with inevitable challenges within the organization structure. For instance, many companies face many problems when relocating its executive to a less industrialized geographical area. Executives accustomed to areas with many industries keep developing sharp marketing strategies hat improves their skills in order to keep up with the heavy competitions from their counterparts. Moving to an area with less or no competitors can possibly make the executives redundant in their performance which is a threat to the success of any given organization.

In addition, moving the executive to a different area may elicit some change resistance reactions due to subjection to unfamiliar situations and this can impose negative impacts to the executive’s work performance which can cause problems to the success of the company’s growth record. The relocation may result in family break ups caused by the separations and these can affectsthe executive’s state of emotions which can also lead to poor performance and lower productivity in their respective departments. Again, some executives may decline to move to the new location and choose to search for other job opportunities in firms situated in their original area. The loss of their human resourcefulness and their expertise skills may be a huge blow to the existence of the company.

Finally, since the task performed by executives in managing the employees differs from one society to the other, the executives may experience difficulties in managing a different team of staff and it may take a long period before they succeed to fully interact with them and to know each one of them personality in order to identify their areas of specialties.

Question 3

In his letter directed to the employees of southern recreation Vehicle Company, the company’s President Mr. Gerald Brian informed his employee regarding the company’s plan to relocate to Ridgecrest Mississippi town and gave reasons for the unavoidable circumstances that led them to move. Mr. Brian gave two major problems which were the increased operating costs and the demands from the unions that he brushed to be unreasonable. Even though the reasons given were sincere since the company was moving to a better physical position that would help them to manage their declining company’s profitability., they were not concrete enough to justify the termination of the employee’s contracts weighing the consequences it would bring to them and to their families.

In addition, the employees were not adequately prepared for the sudden relocation and this was not ethically justifiable. The company could have informed the employees earlier enough and would have gotten involved in ensuring that the affected employees were fully compensated and if possible assisted to get jobs in other companies. The problems the southern recreation vehicle company was experiencing were normal challenges that occurs even in other business organizations and they would have managed through them all and thrive successfully if they employed other strategies other than moving to another geographical area.

The company top management team would have looked for other ways to resolve their problems other than taking a decision to move from their original location. For instance, they would have come up with ways that would help to minimize the operating costs for a period of time to enable the company to recovers. Such cost cutting ways includes employee’s retrenchments, offering employees temporary unsalaried leave or reducing some employee’s benefits. The company could have considered a merger with another manufacturing and assemblies firm to share the payments of taxes and to manage the increasing demands from the union.

Question 4

When a company decides to relocate from their current location to different geographical areas, they have ethical responsibilities to ensure that the affected employees are fully prepared and offered with the required assistance to manage the challenges that comes with it. The employees whose contracts must be terminated and those who are tied by contracts and are thus obliged to move to new places of work must be accorded al the necessary help that may help ease the disruptions.

The company should act in accordance with ethical values and assist the employees to get other jobs opportunities. This can be done by giving them appropriate detailed and valid reason to explain the reason for relocations in a timely manner and provides information relating to working in new organization through training programs. The company should create adequate time to write employee’s recommendation letters to refer them to the potential employers. The company should ensure that the employees get full basic compensation and all their benefits must be paid without delays.

Finally, the company must fully submit to the laid down legal relocation laws and regulations and meet all the requirements before discharging the employees for example a the law requires that companies with more than 100 workers must be notified about the impeding relocation three months prior to it.

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