UK: Ford's early retirement incentive is paying off.

UK: Ford's early retirement incentive is paying off. - How do you cut layers of management with the minimum of cost and without permanently losing their skills? Some of Britain's largest companies have found innovative solutions to the dilemma. IBM lead

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Last Updated: 31 Aug 2010

How do you cut layers of management with the minimum of cost and without permanently losing their skills? Some of Britain's largest companies have found innovative solutions to the dilemma. IBM lead the way in 1990 with a programme that offered managers early retirement in exchange for a period of guaranteed part-time consultancy work within the company. Others have since followed, Ford among them. "What it has really done is to have given Ford flexibility in the way it operates," claims Don White, chairman of XR Associates, the company created by Ford to handle its consultancy programme. "Management skills are freed from routine organisational tasks and specifically allocated to-heat-of-the-moment special assignments". Like IBM, Ford offers its consultants 90 days' work a year for two years on 40% of previous salary and at a level equivalent to that at which they were formerly working. The idea, explains White, is not slavishly to return managers to their old departments but to deploy their skills where currently most needed. Nearly 400 have taken up the offer since 1991. White is now developing links with other companies, starting with Ford's suppliers and dealers.

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