Rotten to the core assets

If you don’t know where the provinces of Utter Pradesh and Dongguan are, don’t worry. In the future, you will learn much more of these places, but it won’t be a holiday. Dave Wilson explains.

‘When we got thrown out I left without much fussAnd weekends we’d go dancingDown Streatham on the bus’

– Stay Free (Strummer/Jones)

Your business is currently losing money. So the senior management have decided to implement a restructuring and re-engineering exercise to bring the bottom line of the company ‘in line’ with the expectations of the market.

One of the ways they said they’d do it is by focusing on core assets and competencies, divesting those activities that do not fit the long-term goals of the enterprise.

Your CEO had a meeting with the heads of department last Christmas to tell them as much. He said that once the company had pared down to its core capabilities, by outsourcing those functions that had previously been carried out in-house, it would return to being a ‘best in class industry leader’.

It all sounded quite good, until you found out what it meant. In January, for example, they closed the Middlesborough plant and sent the workers home with two weeks notice. The unhappy personnel were told that manufacturing had all been outsourced to The Happy-Go-Lucky Company in Longgang, Zhongshan, and Dongguan.

But you were in Design Engineering and you felt certain that your job would be OK. You were, after all, one of the intellectual assets of the company.

Then, in February, like a bolt from the blue, you overheard the CEO chatting in the Gents toilets. It seems as though the sales and marketing folks were going to be outsourced too. The CEO had found a telesales operation based in Uttar Pradesh that could handle all the UK sales, and linked up with an outfit based in Soho that would now be responsible for the rebranding, repositioning and marketing of the company.

Whew! Thank goodness it wasn’t you. You were in Design Engineering and you still felt certain that your job would be OK. You were, after all, one of the intellectual assets of the company.

Then, in March, the IT department was outsourced. A lucrative contract with a leading IT service provider was signed by the CEO and the kids in the T-shirts and jeans left one Friday and didn’t come back.

Whew! Thank goodness it wasn’t you. You were in Design Engineering and (Yes, I think we get the idea – Ed).

But in June, you discovered that, in fact, you weren’t quite as invaluable as you thought. The design department was just last on the list of non-core assets. You took one last look at your trusty parametric solids modelling software before shutting off your PC for the last time. You left the building with a heavy heart.

This month, you were in the pub looking at the paper. You read in the business section that your previous employer had now returned to profit and that the CEO had left to restructure another organisation along similar lines. On the way out, he had even outsourced his own job to a rather attractive, yet much less financially demanding, 29-year old German woman with an MBA from the London School of Economics.

You stayed in the pub and unwisely divested yourself of your own unemployment cheque.