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Belief Evidence External Reference Points Internal Logic Consistency What you do = What you say Consistency over time AWARENESS UNDERSTANDING BELIEF COMMITMENT Trust Involvement Consistency Evidence Clarity Dialogue Simplicity Relevance I want to make it happen I buy it I get it I heard it The Johnson Pyramid Downsizing in SCJ Historical background Headcount reduced by approx. 1000 employees from 1992 to 2001 1999: 89 employees via non renewal of employment contracts From 1992-1997: approximately 800 employees returned to the joint venture partner with generous separation package, and partner dealt in 1997 with the indefinite employment contract. 1995 Early retirement program stipulated by government impacted around 130 employees Background of SCJ Factory Consolidation Project CURRENT STATUS: Separate business locations with administrative office in Pudong and manufacturing plant in Nanda OBJECTIVES COST SAVINGS Gross profit improvement, resulting from headcount reduction, increasing productivity and eliminating of contract manufacturing fees. Other savings include a reduction in average working capital and avoiding building/utility upgrades. PRODUCTIVITY doubled product maker output/ a single building layout versus 19 buildings CAPACITY The new factory resolves peak production capacity issues and will cover China five-year growth projections. S/H/E Compliance Organizational Objectives Improve efficiency and organizational health No major disruptions of business Remaining workforce committed and motivated Resolve headcount reduction in accordance with labor law in line with principles of our company philosophy of This We Believe by increasing flexibility of workforce, and improving age structure reducing headcount by 11% via 2 projects Background of Work Force Turnover zero Average age of company 38.7 Number of employees over age of 40: Operations: 56% Administration: 70% Over 60% of employees have indefinite employment con
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