Retrenchment-3.9.1

Question 1

Define retrenchment.

Answer 1

When business decides to cut back it’s activities.

Question 2

What causes retrenchment?

Answer 2

Reduce output and capacity.
Job losses.
Product/ market withdrawal.
Disposal of business unit (closing manufacturing).
Scaling back planned capital investment.
Economic downturn

Question 3

Changing organisation structure is a retrenchment action, what are the possible change implications?

Answer 3

Changed management responsibilities.
Large workloads- stress.
New colleagues.
Different reporting structures.

Question 4

Fewer employees is a retrenchment action, what are the possible change implications of this?

Answer 4

Loss of morale.

Bad for eternal stakeholders (community).