Intel has restructured and eliminated about 10,500 jobs during the past 20 months. The company decided to make these cuts owing to declining revenue and market share. Intel used a quantitative approach in making the cuts. That is, the company studied workforce demographics and determined what areas were most in need of cuts and then reassigned people based on where they might best contribute to the company’s future plans. The managerial ranks were reduced the most. Corporate executives are pleased with the process because the company is now more profitable and competitive.
In contrast, some employees believe that the company “botched the restructuring in ways that have harmed morale, employee development and long-term leadership quality.” Interviews with employees uncovered complaints that “Intel disregarded employees’ passions in reorganizing, squandered the talents of HR specialists and unwisely shifted leadership training efforts from lower-level managers to upper-level executives.”
Disgruntled employees believe that Intel did not consider employees interests during the restructuring.
An internal memo obtained by Workforce Management indicated that senior management knew they would be losing quality employees. The memo states: “We know we are losing good people in this move. But we have too many managers, and this manager reduction is necessary to improve our decision making and communication and to resize the company. In addition, since we need to become a leaner company and are limiting job openings, redeploying their skills, as individual contributors or as managers, is not a reasonable option.”

1. Intel’s approach sounds logical to me. Revenues are up, and the company just unveiled a new processing chip that Time called the best invention of the year.
You can’t make everyone happy when you let go more than 10,000 people.
2. Downsizing solely by the numbers is bad. Management should have accommodated employees’ passions and interests when restructuring, even if it resulted in less cuts than desired. In the long run, this will lead to higher employee satisfaction and performance.
3. It sounds like the criticisms are being leveled by people who don’t like their new assignments. They should quit complaining and be happy that they are still employed.
4. I am not sure that there is an optimum approach. It is impossible to balance the short-term goal of reducing costs while maintaining a positive work environment in which people are doing the type of work, they are passionate about.
5. Invent other interpretations or options. Discuss.