Content

Pages

Chapter 1 : Introduction
1.1

12

Background Of The Study

1.2
Current Situation And Key Indicator
Chapter 2 : List Review
2.1
2.2

3-4
5

Issue
Cause and Effect

57

2.3 Findings
Chapter 3 : solution

8 10
10 13

3.1

Recomendation Solution

3.2

Implemention & Justification

3.3

Desire Impact

14 15

3.4
Controls & Evalution
Chapter 4 : Conclusion

16
17

13

Executive Summary
Tan Sri SM Nasimuddin SM Amin is the founder of The Naza Group of
Companies began operations in 1957 as a motor company. He later expanded the
companies in the group to include automotive franchises, property development,
food and beverage (F & B) and telecommunications. Naza now have many partners
and has set up many branches such as Naza Kia Malaysia Sdn Bhd. originally Naza
Kia Malaysia Sdn. Bhd began the late 90s from South Korean. Besides the
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automotive and property development businesses, the Naza Group is also involved
in the F & B industry as the franchise holder of the Bubba Gump Shrimp Co.
chain, Gyu-Kaku Japanese BBQ Restaurant chain and Morelli's Geleto chain in
Malaysia and the master license holder for Tutti Frutti Frozen Yogurt in Malaysia,
Singapore, Cambodia and India

Chapter 1: Introduction
1.1Background of the study
The Naza Group of Companies began operations in 1957 as a motor company by
the late Tan Sri SM Nasimuddin SM Amin. He later expanded the companies in the
group to include automotive franchises, property development, food and beverage
(F&B) and telecommunications
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The group captured its first automotive franchise in the late 90s from South Korean
carmaker, Kia Motors Corporation, through its until, Naza Kia Malaysian Sdn Bhd,
which in 2001 became a full-fledged auto assembler with the introduction of the
locally assembled Kia Spectra.
In 2008, the NAZA Groups unit, Nasim Sdn Bhd, became the exclusive distributor
of the French marquee, Peugeot. Following the groups success in marketing the
Peugeot brand in Malaysia, the French carmaker announced in 2010 Malaysia will
be made its hub for the ASEAN region.
Subsequently in 2013, PSA Peugeot Citroen appointed Naza Group as the official
distribution for the Citroen brand in Malaysia.Besides Kia, Peugeot and Citroen,
the Naza Group is also the official distribute for Ferrari, koenigsegg, Maserati,
Brabus, Harley-Davidson, Ducatti, Piaggio, Vespa, Aprillia and Gilera in Malaysia.
It also imports used-luxury bikers and manufactures scooters and bikers under the
Nazabrand its RM 30 million motorcycle manufacturing plant in Shah Alam
Selangor. As major player in the Malaysian automotive industry, the Naza Group is
an established several initiatives to train and develop talent. At Gurun, the group
established the Naza Academy to provide technical and management diploma
programs to employees and the general public.
Outside the automotive and two-wheeled motor vehicle industries, the Naza Group
is an establish player in the property development market through its subsidiary,
Naza TTDI, which is known today for being the developers of the high-impact
mixed development RM 15 billion KL Metropolis and the iconic RM 4 billion
Plantinum Park, a world-class high-end integrated and commercial development in
the prestigious Kuala Lumpur City Center.
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Naza TTDI is also the developer for acclaimed townships such as Taman Tun Dr
Ismail in Kuala Lumpur, TTDI Grove Kajang, TTDI Alam Impian and The Valley
TTDI, Ampang, amongst others.
Asset investment in another sector that the Naza Group is involved in. Among the
assets acquired are the Cedar Creek Apartments in the United States, retail and oce
space in TTDI Sentralis, Shah Alam, Selangor.
Besides the automotive and property development businesses, the Naza Group is
also involved in the F&B industry as the franchise holder of the Bubba Gump
Shrimp Co. chain, Gyu Kaku Japanese BBQ Restaurant chain and Morellis Geleto
chain in Malaysia and the master license holder for Tutti Frutti Frozen Yogurt in
Malaysia, Singapore, Cambodia and India.
Apart from these industries, the Naza Group has subsidiaries involved in limousine
service (Prestige Limo), transportation (Naza transport), taxi service (Zalnas
Limousine and Naza Citycab), aftermarket accessories (NZ Galaxy), Financing
(Naza Credit and Leasing), auto insurance (Naza Coverage and Eight Valuelation)
and plantations (Wood Vison).
Another divestment of the Naza Group is Premium Radus which researches and
develops

telecommunications

engineering

solution.

Licensed

under

the

Communications and Multimedia Act 1998, the company deploys focused

telecommunication infrastructure to all telecommunication operators in Malaysia.

1.2 Current situation and key indicator

1) Current situation
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Nowadays Naza Automotive Manufacturing (NAM) had lay off 300 of its
employees in a cost-cutting. In an e-mail to The Rakyat Post, Naza Group
corporate communications said that it had undertaken the exercise to rationalize the
staff strength due to the current poor economic situation that has seen the ringgit,
domestic and export demands severely affected.
However, at this time, our priority and focus is to assist and support where
we can those affected to ensure that their welfare is well managed and taken care
of.
We have provided a separation package to enable them to plan their future
endeavors, said the groups representative. It was also stated that the group would
continue to address measures of cost efficiency, without compromising its quality
of service
The farewell session was conducted this afternoon at Dewan Seri Zaleha in
Gurun, Kedah. According to the programmers itinerary, those laid off consisted of
255 staff, 30 from the NAM committee and the rest from the administration.
The event was attended by NAM chief operations officer Roslan Abd Ghani
and it was there that the staff was given their termination letters. NAM started its
operations in 2004 and is one of Naza Groups car manufacturing companies.
2) Key Indicator
The base on the current situation, the key indicator is Naza do this action was
because of to rationalize the staff strength due to the current poor economic
situation that has seen the ringgit (RM), domestic and export demands severely
affected.
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Naza believe when they waste their employees can reduce the cost of paying wages
to the workers and to increase the profit in the company and want them to find
workers who have high performance.

Chapter 2 :List review

2.1 Issues
Naza Automotive Manufacturing lays off 300 staff.

Naza Automotive Manufacturing (NAM) has laid off 300 workers at its

assembly plant in Gurun, Kedah. The lay-off at NAM involved 225 staff members
as well as 30 from the NAM Committee, with the remainder being administration
staff.
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2.2 Causes and Effect

Causes:
1.

Economic Downturn

The ringgit depreciation as a symptom of declining export revenues, capital

outflows, and worsening investor sentiment toward Malaysia. This scenario proved
that the Malaysian economys is heavily dependent on commodities, especially
petroleum and palm oil. These two commodities are the main exports from
Malaysia, with severe negative ramifications from the global price of oil
plummeting, as the nation depends on oil for about 30% of its revenue.

2.

Good and Services Tax (GST)

Upon GST implementation, Malaysians have taken their bills seriously and

perhaps now noticed there is a service charge on their bills. Vehicle sales in
Malaysia fell nearly 33 per cent in April following the introduction of the Goods
and Services Tax (GST), in a further indication of the effects of the new
consumption tax on the economy. Combined private and commercial vehicle sales
dropped from 67,314 to 45,187 during the space of a month, with the main variable
being the new tax that replaces the previous Sales and Services Tax (SST).
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Effects :
1.

Former workers are jobless.

The workers are jobless. It is hard to find job these days due to the economic

downturn.
2.

Emotional impact on workers

People experience many emotional reactions to a layoff. Indeed, just the

word layoff generates waves of emotion for many people. These are some of the
emotional impacts:
i.

Sadness and depression - A layoff can shake our feelings of self-worth,

personal security and personal control. In addition, people may have to give up
activities or certain roles, have fewer social contacts, face disruption in daily
routines, and find themselves separated from roles and rewards that give meaning
or purpose to their lives. These self-doubts and changes can lead to feelings of
helplessness and depression.
ii.

Shock, Disbelief and Denial - These feelings are frequently expressed in the

thoughts such as: This cant be happening; There must be some mistake; This is
just a bad dream and everything will be okay when I wake up.
iii.

Shame - This feeling is often related to beliefs we have and assumptions we

make about our situation. Sometimes shame relates to the belief that we may have
failed as a provider, parent or person. It may result from the view that our job, as
an indicator of social status and respectability, is now lost.
3.

Workers Loss income

The people who lose jobs also lose incomes, so they spend less. people

worry about obtaining income, paying the bills, and readjusting their household
budget to account for their new economic reality. Once a plan and new budget are
in place, concern shifts to the long-term economic impacts of the layoff.
4.

Direct Costs

One of the things a business owner considers when they need to save money

at a company is laying off staff in anticipation of saving money on payroll and

benefits. However, the company often ends up incurring costs as a result of the
layoff that minimize the savings. For example, the company may have to issue
severance pay to outgoing employees, pay overtime wages to remaining employees
and use placement services for temporary help.
5.

Sales drops due to decrease customer loyalty

Laying off employees can have a significant negative effect on customer

retention. Every customer is an asset to any company, and the employer must find
ways to retain each of them. When a company lays off its employees it sends out a
message to customers that it is undergoing some sort of crisis. Fewer employees
could mean delays in the delivery of goods and services, further alienating
customers, therefore the sales of the company dropped.

2.3 Findings
From The Rakyat Post news dated 27 August 2015 it stated that Naza Automotive
Manufacturing (NAM) laid off 300 of its employees in a cost-cutting exercise. In
an e-mail to The Rakyat Post, Naza Group corporate communications said that it
had undertaken the exercise to rationalize9 the staff strength due to the current poor

economic situation that has seen the ringgit, domestic and export demands severely
affected. It was also stated that the group would continue to address measures of
cost efficiency, without compromising its quality of service. According to the
programmers itinerary, those laid off consisted of 255 staff, 30 from the NAM
committee and the rest from the administration.

Strategic Management :
SWOT Analysis of the Financial Crisis
A SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis, long used
by businesses large and small, is particularly relevant in periods of financial crisis
and down economies. SWOT evaluations often provide a snapshot of the "state of
a business," and the basis for a "road map" to help management plan future
direction.

Strengths
The financial crisis identified some surprising strengths in many businesses. Down
economies reward companies that exhibit creativity, expense control, boldness,
fearlessness, and confidence. Companies unafraid to introduce new products,
manage (or raise) prices, upgrade customer service, and conserve capital often
uncover strengths they didn't realize they possessed. Common strengths that are
valuable during a financial crisis include fair prices, quality products, superior
customer service, and a brand that consumers trust.
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Weaknesses
SWOT identifies both internal and external weaknesses. Unfortunately, during a
financial crisis, internal weaknesses are not only exposed, they are often
magnified. Among the most common shortcomings during down economies are
marginal customer service, product quality deficiencies, and lack of superior
financial controls. Lack of "staying power" has led to the demise of numerous
entities during financial crises. Common weaknesses during a financial crisis
involves having too much debt and too few cash reserves. However, identifying
weaknesses also offers companies the ability to address and correct issues that
could pose survival challenges during a financial crisis.
Opportunities
A SWOT analysis points out external opportunities, sometimes hidden, during
financial crises. Opportunities to target a different group of customers, sell new
products and services, and open new geographical markets often "magically"
appear during down economies. Consumers still need products and, when some of
their former sources disappear, they will turn to other companies to fill the gap.
Reaching out to potential customers with profiles different from those historically
consistent demographics can also present both a short- and long-term opportunity.
Examining new geographic markets, domestically and internationally, often
replaces revenue lost during a financial crisis.
Threats
Down economies produce multiple threats to businesses, large and small.
Identifying and minimizing these roadblocks is critical. Inability or unwillingness
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of consumers to purchase your products and services during a financial crisis is the
most dangerous threat. Understanding the real cause of this threat can help
companies address this challenge and survive. As employees are laid off or
downsized, these consumers no longer have the discretionary income
(unencumbered dollars that people can spend on items not classified as necessities)
to purchase many products. Those workers that still have jobs become reluctant to
spend, as they worry they may suffer layoff or downsizing in the near future.
Conserving cash for emergencies becomes their primary concern. Changing your
pricing structure, identifying additional customers, and opening new markets can
help meet and defeat this threat.
Expert Insight
SWOT analysis, used by many companies since the 1970s, is particularly
beneficial during a regional, national, or global financial crisis. A SWOT analysis
showed that, along with the many threats (external) and exposed weaknesses
(internal), the financial crisis also forced businesses to acknowledge their strengths
(internal) and identify new opportunities (external) to help them, not only to
survive, but to prosper.
Chapter 3: Solution
3.1 RECOMMENDATION AND SOLUTION
Naza Manufacturing Company represented stated, our priority and focus is to
assist and support where we can, those affected, to ensure that their welfare is well
managed and taken care of. We have provided a separation package to enable them
to plan their future endeavours.
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Meanwhile, we shall continuously address measures of cost efficiency without

compromising our quality of service to our customers.

3 WAYS TO HELP EMPLOYEES YOU'RE ABOUT TO LAY OFF

EVEN WHEN YOU HAVE TO LET PEOPLE GO, YOU CAN MAKE THE
TRANSITION SMOOTHER FOR EVERYONE.

Letting go of employees is never easy, but having a good outplacement plan can
help make the transition smoother. Instead of a one-time cash payment,
outplacement services allow displaced workers to utilize services like career
counseling, interview coaching, and resume advice, all of which allow the
organization to help them get back on their feet and move forward.
I.

OFFER CAREER COUNSELING

Its great to help displaced employees network and find opportunities, but
companies should also make sure they have the tools to pursue those opportunities.
In addition, many displaced employees may feel overwhelmed and unsure of what
their next step should be.

Offering career counseling can be a good way to mitigate those fears and help
workers figure out their next move while also providing insight into creating
resumes and handling job interviews. To avoid awkwardness, consider outsourcing
the counseling through a third party or offering a program online.
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II.

HELP WITH NETWORKING

Employees who have been working the same job consistently or are new to the
workforce may not have developed an extensive network. Helping them with
networking can make their job search easier .
This could be anything from offering advice on how to network to connecting
displaced employees with alumni willing to provide mentorship. Adding
technology solutions to your outplacement plan can help with this as well, allowing
individuals to keep their contacts in one places and connect with a larger network.
In addition, hosting a networking event is a good way to connect displaced
employees with potential employers, as well as assisting in setting up LinkedIn
pages.

III.

EXIT INCENTIVES

This option envisions offering employees incentives to leave the organization in

the form of severance or early retirement packages. This strategy permits better
targeting of jobs and units, it recognizes employees for their past commitment to
the organization, and helps retain the remaining employees. On the other hand, exit
incentives are expensive, create future expectations and an entitlement mentality,
and discourage workers from leaving the organization in the future.

3.2 IMPLEMENTATION AND JUSTIFICATION

Naza Automotive Manufacturing lays off 300 staff :How to implement and achieve
it.

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After assessing the magnitude of the economic downturn and likely duration of the
strategy to be implemented, evaluating the costs and savings, and considering any
legal ramifications, an employer next must decide on what strategy(s) will best
address its situation.

Communicate with employees to gain their support and obtain their ideas

No matter what strategy an employer utilizes, results will hinge on the level of
communication with the workforce. As early as possible after the necessity for
cost-saving measures is identified, educate employees about the state of the
company and possibly about what alternatives to layoff are being considered. Ideas
about what could shave expenditures should then be solicited from the employees
through surveys, emails, focus groups and interviews. Not only do employees often
offer innovative ideas when their jobs are directly implicated, but morale will be
bolstered by managements display of confidence in the workforce. The stronger
the communication process, the less likely that employees will choose to leave the
company.These how we can related with the recommedation of the offer career
counseling,which employer communicate with employees to gain their support and
give the ideas.
3.3 DESIRE IMPACT
Layoffs Affect to Employees and Employers
Its not only employees who suffer when there are layoffs off but the firms
responsible for handing them the pink slips can take a beating, too. The people who
lose jobs also lose incomes, so they spend less. Even workers who dont lose their
jobs but are simply fearful of layoffs are likely to cut back on spending too. With
less aggregate demand in the economy, sales fall. With smaller sales, companies
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lay off more people, and the cycle continues.

The layoff of one individual in a company may appear minor, but it often causes a
ripple effect in an organization where employees work together to achieve a
common goal. A layoff introduces a missing link in the team, which affects the
organization in several ways. The company faces a greater challenge when layoffs
occur.
Direct Costs
One of the things a business owner considers when he needs to save money at a
company is laying off staff in anticipation of saving money on payroll and benefits.
However, the company often ends up incurring costs as a result of the layoff that
minimize the savings. For example, the company may have to issue severance pay
to outgoing employees, pay overtime wages to remaining employees and use
placement services for temporary help.
Increased Turnover
Business owners who execute layoffs in their companies frequently see additional
employees resign from their jobs. Layoffs can disillusion top-ranking employees
who then opt to leave the company. Watching a colleague leave involuntarily could
cause an employee to consider job offers from other companies seriously or to
actively seek new job opportunities.
Decreased Customer Loyalty
Laying off employees can have a significant negative effect on customer retention.
Every customer is an asset to any company, and the employer must find ways to
retain each of them. When a company lays off its employees it sends out a message
to customers that it is undergoing some sort of crisis. Fewer employees could mean
delays in the delivery of goods and services, further alienating customers.
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Emotional Distress
The person who is laid off suffers the most distress, but remaining employees
suffer emotionally as well. Because the layoff disrupts the status quo, employees
have to pick up extra responsibilities and form new work relationships, which can
cause stress. The productivity level of employees who work in fear is likely to go
down. The situation is even more damaging to the company when the person who
has lost his job stays around until the date of termination of his contract.

3.4 CONTROL AND EVALUATION

I.

Ask employees for ideas.

olicit suggestions from staff about how to cut costs and improve productivity. Even
if what you save doesnt meet your shortfall expectations, getting employees
involved can ease insecurity and promote solidarity.
II.

Cut out the extras.

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Freeze additional hiring and cut bonuses, raises, unnecessary travel and overtime.
Postpone non-vital equipment upgrades. Nix office perks like bottled water and
seasonal office parties, or find cheaper alternatives.
III.

Offer extra days of unpaid leave.

Extra vacation time is something many employees will find agreeable, even if its
unpaid.
IV.

Exchange workers with other employers.

Larger companies do this within their own umbrella of subsidiaries. Smaller firms
can choose partner companies or vendors. Ideally, the host firm would pay
employee salaries and get the use of a skill set like marketing that it might not have
on staff. The mutual benefits are a cross pollination of skills, retention of
employees and temporary wage relief.
V.

Consider wage or benefit cuts.

Such moves go over better when they start at the top. Some experts say it can help
pad the blow if senior management takes a bigger cut than the rest of the company.
You can also offer buyouts for employees with longer tenures.
Chapter 4: Conclusion
As a conclusion the action Naza Automotive Manufacturing Sdn Bhd company
very surprising for all Malaysians. But they have good reason to do such decision.
As we know at present our country Malaysia is experiencing an economic
downturn which resulted in a sharp fall of the currency. Therefore the impact of the
serious concern economic downturn it is possible this is one of the best steps to
reduce costs in the company. But as we all know many workers who are not
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satisfied by it is appropriate for the company to explain the deeper to all affected
employees can understand why they removed from the company.

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