How about Circuit City's recent decision to define a wage cap for retail employees, and then lay off all employees earning a higher salary? This action smacks of managerial laziness, and desparation, and efforts to prepare a failing company for a quick sale.
CNN implies that Circuit City's problems are structural (supply chain management, real estate costs); the business press is full of stories about Circuit City's search for "strategic" solutions.
I've quoted my Corporate Strategy professor, Paul Tiffany, before: cutting costs is not a strategy.
Changing your customer interface is, I suppose, a strategy of sorts!
Apparently, Circuit City will also "allow" these staffers to rejoin the company in a short time for a lower wage.
Skilled managers might have taken time and effort to restructure pay packages in a less draconian, and more emotionally intelligent manner -- and one that, done well, could have won employee support during a time of obvious transition.
CNN also compares Circuit City to Best Buy, much in the way I recently looked at Wal-Mart, Target and Costco.
Best Buy has become a topic of conversation in the press (and even at my office) because of their innovative experiment to allow employees to set their own hours, and for their performance to be measured based solely on results.
While this practice requires a significant commitment and discipline in the art of managing people, if successful, Best Buy will have accomplished -- in a very savvy way -- the kind of expense management that has eluded Circuit City. Employee turnover in retail is huge, leading to inflated hiring and training costs.
Why should Mom & Pop care about this story? In a small company, individual contributions are more glaringly obvious than they are in a large firm. 5 unhappy employees have a much higher impact in a 10 person company than they would in a firm employing 10,000.
In a small firm, the cost of hiring is less likely to have a price tag in dollars. You probably won't send the new staffer off for a day of training and orientation. Instead, you'll invest the time of one of your key employees, maybe you.
When you're training someone to balance the cash register at the end of the day, you're not dong the work it takes to attract more customers.
And how do customers feel when they hear that you're not treating your employees well? (Or feel the ways that employees are treated, based on the treatment they receive?) I'm not a big consumer of electronics, but I do vote with my wallet. If Circuit City survives much longer under current management, I'm an unlikely visitor.