Managing Change Essay Example | Topics and Well Written Essays - 2250 words

Managing Change - Essay ExampleThis move would have resulted in the loss of 600 jobs in its combined workforce of just about 4,200 employees from the two plants. For that year, annual production targets were also reduce from 70,000 units to merely 40,000. Global everywhereproduction and a 17% slump in domestic sales for the second half of 1999 were the reasons cited by Mitsubishi for the downsizing. Mitsubishi officials also claimed that the decline in the value of the Australian dollar had made it as well as costly to import Mitsubishi components. The decision to downsize in 2000 followed the downsizing of already 300 production jobs for the company yet despite these decisions, profits for the company did not improve. As of December 1999, the company reported a $A 130-million loss, its worse in twenty years in Australia (Cook, 2000).In 1997, the Howard government suspended plans to end tax protection for the car industry until 2010 due to pressure from car manufacturers and thre ats by Mitsubishi that it will wind-up production in Australia. This was initially regarded as guaranteeing job security for worker, barely despite the existence of tariff protection, major restructuring and downsizing still continued in Mitsubishi. The reason is that downsizing is attributed not to the companys national performance but to a major global restructuring program announced by Mitsubishi in October 2000 to cut costs by $US 3 billion by 2001. The plan affect cutting 9,900 jobs from the companys international workforce of 88,800 over a span of four years. Of the 9,900 jobs to be cut, 1,400 of these are production and clerical jobs in Japan (Cook, 2000).Another element that compounds to the companys problems is its debt of 1.75 trillion yen or $A 27 billion. Mitsubishi continues to be under pressure from Daimler-Chrysler, who has a one-third holding in the company, and the power of veto over Mitsubishis board. Daimler-Chrysler is demanding Mitsubishi to take drastic step s to reduce its huge debt and that the company focuses its future investment in more efficient production plants in Malaysia and Thailand (rather than Australia) where there is cheaper tug and favourable local investment incentives (Cook, 2000). In addition to these problems, Mitsubishi is also burdened by a failed vehicle financing scheme in the U.S. and losses amounting to approximately $US 2.8 billion in 2003. Daimler-Chrysler, the majority shareholder for the company, also refused to give Mitsubishi a $US 6.5 billion restructuring package (Spoehr, 2004).In 2004, Mitsubishi released a restructuring plan and officially announced its decision to close down its Lonsdale Plant resulting in the loss of 650 jobs, including the reduction of 350 workers in their Tonsley Park assembly plant workforce (Spoehr, 2004). The