Shutdown at Eastland
Shutdown at Eastland
When dealing with plant closures there are many factors to take into consideration; namely, how does a company extract itself from a community that it has helped sustain for more than 20 years? The answer: tactfully. There are more interested parties besides the stockholders in the success and failure of a business, and they include the employees and the local community of the plant. If handled correctly, a plant can successfully close without any bitter feelings from any of the stakeholders. In order to close a plant successfully, the company must be willing to invest the time and effort into researching the best possible way to meet each stakeholder (as a collective group) needs.
The responsibility of the success and failure of a business ultimately rests with the upper management, board of directors, and stockholders. When a business makes the economic decision to close it is necessary to provide the other stakeholders enough time to come to terms with the closure and to make the necessary decisions for life after closure. According to the Worker Adjustment and Retraining Notification (WARN) Act, and employer is only required to give 60-days notice when a company (such as the Eastland plant in Michigan) employs 100 or more workers (Meder, p. 2). If a company wishes to close a plant with grace and dignity for all concerned, then a year (and a well-laid plan) would be more sufficient time for notification of closure. I found that the French food company, Danone, had one of the best plans for a plant closure and would readily follow a similar plan if it were within my power to decide.
When Danone closed one of their plants in 1995, the company demonstrated their social responsibility to the stockholders, employees, local community and suppliers. Danone realized that “production plant closures tend to lead to a drop in local income and tax revenues, a deterioration of public services and the loss of investment appeal” for the local
When dealing with plant closures there are many factors to take into consideration; namely, how does a company extract itself from a community that it has helped sustain for more than 20 years? The answer: tactfully. There are more interested parties besides the stockholders in the success and failure of a business, and they include the employees and the local community of the plant. If handled correctly, a plant can successfully close without any bitter feelings from any of the stakeholders. In order to close a plant successfully, the company must be willing to invest the time and effort into researching the best possible way to meet each stakeholder (as a collective group) needs.
The responsibility of the success and failure of a business ultimately rests with the upper management, board of directors, and stockholders. When a business makes the economic decision to close it is necessary to provide the other stakeholders enough time to come to terms with the closure and to make the necessary decisions for life after closure. According to the Worker Adjustment and Retraining Notification (WARN) Act, and employer is only required to give 60-days notice when a company (such as the Eastland plant in Michigan) employs 100 or more workers (Meder, p. 2). If a company wishes to close a plant with grace and dignity for all concerned, then a year (and a well-laid plan) would be more sufficient time for notification of closure. I found that the French food company, Danone, had one of the best plans for a plant closure and would readily follow a similar plan if it were within my power to decide.
When Danone closed one of their plants in 1995, the company demonstrated their social responsibility to the stockholders, employees, local community and suppliers. Danone realized that “production plant closures tend to lead to a drop in local income and tax revenues, a deterioration of public services and the loss of investment appeal” for the local