Case Study Of Chow Tai Fook Jewellery Group Limited

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Context

Background

Assume we are Chow Tai Fook Jewellery Group Limited, a Hong Kong based jewellery retailer, and our company will reduce 60% manpower. Now, we are going to find out why we need to reduce about 60% manpower, what key positions we need to cut, and also how to cut them with specific methods.

Chow Tai Fook is classified as the top of the Hong Kong jewellery retail industry. We have 103 retail shops in Hong Kong at September 2016. In recent years, our performance record a fall of 46% .We need to have a HR planning to forecast on anticipation and develop an action plan.

Reason of reducing manpower (Step 1)

Cutting down manpower is due to the decreasing labor demand of our company, based on external and internal factors. …show more content…

Also, there is an overestimate of sale expectation. Because of the expansion of tourism in the year before, our company decided to extend the sales line. Now, we need to close up some branches because the difference between our expectation and real …show more content…

For year 2, we will restructure back office and cut manpower in each department, as those departments do a little effect on profit margin.

For year3, performance standard should be redesigned in order to cut down the salesmen with low job performance and replace them by hiring part-time employees in order to respond to the loss of profit.

Three years detail action plan (Step 4)

To reduce 60% of total manpower, we have designed a 3-year action plan to specify the appropriate methods of cutting them. Also, we will provide solutions about how to handle projects on hand during manpower reducing and how to motivate the employees.

Year 1

Restricted hiring

In year1, we will adopt restricted hiring, and assume there are 5% natural wastage that some employees may want to retire or resign.

Downsizing - rightsizing(sales)

Secondly, we will conduct downsizing action, which is rightsizing the front line sales department to reduce 15% manpower. Due to the negative future of retailing industry, we would like to close some branches to lower the marginal cost. Therefore, we expected fewer employees are needed in the front line. Eventually 15% target was setted up. Although it will combat the staff morale, it is necessary to respond to the trend more sensitive to establish a competitive

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