Shareholders Versus Employees ?
Perhaps, the current Offshoring Backlash has it's origins and roots in the natural conflict of interests between Employees and Shareholders.
Shareholders naturally demand increasing financial returns.
Employees sometimes feel that they are the first (and only ?? ) casualty of any Cost-Cutting Efforts.
This article is the first in a planned series of articles covering the Employees Vs Shareholders Battles.
These series of articles are a personal viewpoint and may not reflect the views of the organization.
We all know the KinderGarten Poem 'Humpty Dumpty'.
The same is repeated for those of us who have perhaps forgotten our early lessons.
Humpty Dumpty sat on a Wall.
Humpty Dumpty had a great fall.
All the King's horses and
All the King's Men,
Could not put Humpty-Dumpty together again.
Humpty-Dumpty Shared A Wall.
Inside, Humpty An Employee.
Working in the Company Hall.
Outside, Dumpty A Shareholder.
Demanding in his Calls.
Humpty Dear Me, had a great LayOff Fall.
Dumpty was unmoved.
The Share Price did not fall.
It infact shot up, High and Tall.
In the Street, near the Wall.
Humpty, Desperate in his calls.
Dumpty, Deaf to All.
Humpty, Down. Screaming To All.
Laid Off the Hall.
Dumpty was wondering.
Where are the Profits ?
Is that All ?
All the High Profits due to the
Cost Savings could not put
together Dumpty's soul again.
Postscript : According to an article in the March 2004 issue of Harvard Business Review - HBR (Registration Required)(Forethought - Human Capital - " How's your Return on People ? " ), 2 researchers tracked 575 Publicly Traded Firms on the effect of their employee education & training expenses on their Stock Prices.
The Researchers prepared 3 portfolios of companies (20 - 40 Companies) that spent aggressively on Employee Development at twice the industry norm in each of the years from 1996-1999.
Each of the above 3 portfolios outperformed the S & P 500 Market Index by 17 % to 35 % in 2003.
Conclusion : Organizations that make extraordinary investments in people often enjoy extraordinary performance on a variety of indicators including Shareholder Return. Employee Layoffs destroy shareholder value as per these Researchers.
Email Us : Can we help in Offsourcing
for Shareholder Value-Maximizing ?
and may not reflect the views of the entire organization.