Your boss sent the following e-mail this morning:

Today I am announcing a 10 percent reduction in spending in every department, effective immediately.

We must improve profitability, and this is the quickest way to improve the bottom line. I assure you that every department will share the pain equally. I am not asking anyone to work harder, but all of us will have to work smarter. Explain why the announced across-the-board cuts in resource spending might not improve but actually worsen profitability. How would this situation differ, if at all, ina governmental agency?