Chapter 1: List some of the changes in management practice that have occurred in the recent past and describe how these changes have impacted things like, for example, efficiency and effectiveness, IT, allocation of organizational resources, or achieving and maintaining a competitive advantage in the marketplace.
Select one or two of these changes (or others, if you prefer), and describe the resulting impact.

Recent changes in management practice have included restructuring, outsourcing, and allowing employees to explore their own ways in building up their clientele or business within a company. Restructuring involves downsizing a company in order to reduce the operating costs, whether it’s to close one of many department store in a major retail company (which many times involve job losses) or replacing employee resources with technology providing more efficiency, but not necessarily effectiveness. For example, CVS Pharmacy has recently began to provide self-checkouts for their customers, allowing customers to be able to ring up their own sales instead of waiting in line for a sales clerk to do so; this helps CVS because it helps reduce the number of sales clerk they need to hire and in turn, reduces the amount of job openings available and saves CVS a substantial amount of money by not having to fill those positions. Although this increases their efficiency in check-outs, it does not, however, prove to be any more effective than allowing a sales clerk to ring up, because technology is not always reliable – they may have technical problems, or may not even ring up the sales properly – therefore, still needing an employee to finish up the transaction for them – sometimes frustrating customers, and costing the company more money to still hire more employees and fix those machines.

Another instance, Saks Fifth Avenue, has been downsizing their company by closing stores along the East coast because those stores prove to not be making their sales goal as a store and do not bring as much foot traffic as anticipated by the executive management. While this downsize prove to save a substantial amount of money for the company by focusing on other stores that can deliver high volumes of sales, shutting down the stores results in many job losses; and while they offer compensation packages, not many employees would want to pack up their things and move to another state to work for the same company that “kicked” them out of their own store to begin with. While many associates enjoyed their time with Saks, they may feel discouraged to stay with the company because of their initial experience of being laid off. For example, I work at the Chicago Saks store on Michigan Avenue, and while it is a flagship store – often catering to international and upper-middle class clients, sometimes I wonder if there is a chance that our store is next to shutting down because of the recent closures at other stores. While it may not feel discouraged to work, it is a question that associates sometimes ask themselves. Despite the doubts that some people may have at the company, at least we are lucky enough to have to worry about our jobs getting outsourced.

Another thing that Saks does is allow employees to build their business their own way; although there are guidelines as to how to build our clientele, managers allow associates to handle their clients individually. In our store, depending on the relationship that has been built between associates and their client, sometimes associates give out their cell phone number so that clients are able to get a hold of their associates and get the best service possible – whether it’s a personal shopping experience, or a delivery service (while it is not highly encouraged by management for safety reasons), or just a simple easy in-and-out experience – management allows their employees to make judgment calls with their associates because each individual has their own personality and own ways of handling different types of people and situations. Being able to have the responsibility and option of how to drive our own business gives me the chance for me to test the waters and see what works to my advantage and what does not when it comes to working with clients; so when I have a success transaction and gain a friend/client, it makes my day, and it also makes management happy to hear that we have gained a fantastic client who looks forward to their next shopping experience at Saks.

Luckily, our jobs as associates are not outsourced to another country. International companies such as IBM and Lucent Technologies have outsourced jobs all across international waters, such as India. IT and customer support provide jobs in other countries at a cheaper cost, resulting in less jobs provided within the company in the United States. Not only is it cheaper to outsource such jobs, but allows their company to remain effective and efficient. Because of such high global competitiveness, outsourcing jobs allow companies such as IBM to lower the cost of help support, and allow them take the money that they are saving and spend it on new products for customers. Outsourcing creates a problem in the job market because more people lose their jobs to those in other countries who charge their services at a lower cost.