A weakening global economy has created difficulties for business. Common survival strategies include massive cost-cutting, personnel downsizing and streamlining of operations. The Director-ate-General of Budget, Account-ing and Statistics (主計處) recently reported an unemployment rate of 3.35 percent. Around 330,000 people are out of work, but that number actually impacts on more than 770,000 people. If the situation keeps worsening, it will become a serious social problem.
Hit by shock waves from the economic slowdown, some well-known local enterprises have had to make painful decisions. To maintain their competitive edge, massive layoffs and organizational restructuring may be required. The process, however, will be a severe test of whether the enterprises can hold firm to the corporate ethics to which they have adhered for a long time, or whether they will feel themselves forced to abandon these ethics.
Acer Inc (宏電) used to be a model for corporate culture. Some of the company's well-known values include the concept that human nature is basically good, respect for emplo-yees, partnerships and mutual trust and cooperation among workers. On Feb. 23, however, Acer's assembly plant in Hsinchu axed more than 300 workers without any warning. Not only were the workers taken by surprise, but others, like me, who admire Acer's corporate culture, were perplexed. Did such actions fall short of respect for employees? Didn't the move stray from the tradition of mutual trust which Acer has emphasized?
Acer Group Chairman Stan Shih (施振榮) sent e-mails to his workers saying that the decision was a painful one. He said that the predicament facing the company was related to the over-optimism of high-ranking managers' in good times and their insufficient sense of crisis. If that is true, the responsibility for their problems should be shouldered by everyone who was at fault, including those managers.
I wonder what rules govern such dismissals. I want to know whether these rules are fair and in conformity with the principles of commercial ethics and whether the dismissed workers were informed of the rules in advance and of the reasons for their dismissal.
Given that the economy is depressed, there seems to be nothing wrong with downsizing to keep enterprises alive. Streamlining, however, is only one of the many choices as to how to weather the storm. After taking into account the adverse effects on workers and their families of unemployment, some companies will adopt other schemes to minimize the side effects, including cutting working hours for all workers, having people go to work in turns, or cutting salaries for the entire workforce.
These emergency measures may both prevent massive layoffs and realize the promise of sharing common interests with employees. The late William Hewlett, founder of Hewlett-Packard and his partner David Packard practiced this concept. Because they respected others and cultivated a corporate culture that highly values humans, they gave HP a very high ethical status in business circles.
Under Shih's leadership, Acer Group has achieved a great deal and established a distinguished corporate culture. Acer not only serves as a role model among ethnic Chinese corporations, but also enjoys worldwide fame. During the massive layoffs, we want to know whether Acer's leaders -- who may well have considered the matter most carefully and scrupulously -- have taken into account employees' rights and interests or the ethical concerns which they should have for their workers. Since Acer is an excellent corporation, society naturally expects a higher standard of ethics from it.
Ip Po-keung is a professor in the Institute of Philosophy at National Central University.
Translated by Jackie Lin
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