August 2nd, 2007

A Word or Two More About This Week’s News…

During conversations with reporters Tuesday about the cost reduction plans, one question that kept coming up was why more wasn’t said about the local impact about which employees were affected and facilities were being closed. The primary question being why the company wasn’t more forthcoming?

This is a hard one. It raises an important issue about how a company should deliver such news. In fact, this question was debated a good deal internally, with strong arguments made on both sides.

In the end, we said only that expected reductions were to be about 3 to 4 percent of the global workforce and handled in accordance with local works councils and labor laws. A choice was made against providing a more detailed breakdown of the employee numbers or the expected impact at the segment, operating company or regional levels.

As Bill Weldon explained during the call and in his letter to employees the decisions were being made at each operating company – those organizations make the final decisions about how to manage their businesses and are best placed to determine which facilities or employees are going to be affected.

In some cases, the news of decisions reached followed swiftly. For instance, in Mountain View, Ca. employees at ALZA and Scios were told on Tuesday that the Mountain View site was going to be closed; some jobs would be eliminated and some relocated.

In some other cases, specific decisions may be revealed at a later date.

Regardless of what is decided, one thing is clear: the affected employees will be told before the media or investment community. It’s only fair. Out of respect for the employees, it’s important for the supervisors and business leaders to have discussions with the people who are affected by these actions before they are reported in the press.

Some reporters understood this approach. Others disagreed. The best approach to this type of issue will always be debated, but the underlying intention is sound and in keeping with how Johnson & Johnson has traditionally made such decisions.

One other thing about these decisions. – Johnson & Johnson is a big organization, with lots of opportunities. When it is said that every effort will be made to place affected employees, that generally means the company will include job fairs for internal and external opportunities, career centers, resume tips and other helpful hints.

The fact is that while management will work to reach these goals, they will also be working to minimize the number of employees affected by these actions through the use of attrition and hiring freezes in certain areas of the business.

3 Responses to “A Word or Two More About This Week’s News…”

  1. Antoine Clarke says

    your silence this week may well be because you are enjoying a holiday. If so, good for you.

    However, the news today that J&J is suing the American Red Cross is the sort that really can’t be left solely to the lawyers. The Red Cross has issued its statements and is drumming up public and media sympathy.

    Here’s the developing story:

    For a corporate blog, this is precisely the moment of truth. If you are allowed to wade in, you win credibility. If you wade in and a tolerable public debate occurs, you win big time. Stay quiet, and it looks like the lawyers and bean counters run your blog. This would be a shame on so many levels.

    Perhaps a description of the timeline of this row? Perhaps some leads as to what is due to happen, where and when? Perhaps even a link to a J&J site that describes the history of the firm and its use of the Red Cross? (You could add it to the sidebar even) I doubt if all these ideas could remotely be considered a violation of sub judice, but if so, how about a post to say so!

  2. Jim Katsas says

    According to the Credo:

    “…We are responsible to our employees,
    the men and women who work with us throughout the world.
    Everyone must be considered as an individual.
    We must respect their dignity and recognize their merit.
    They must have a sense of security in their jobs.
    Compensation must be fair and adequate,
    and working conditions clean, orderly and safe.
    We must be mindful of ways to help our employees fulfill
    their family responsibilities…”


    “…Our final responsibility is to our stockholders….”

    Sad to realize that the first responsibility is to our stockholders, and the last to our employees.

    Maybe it’s time they change that famous Credo and stop fooling us…

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