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A Research Paper
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In Partial Fulfillment
MPA 201
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Submitted By
Henry L. Habal
To
September 2019
BATAAN PENINSULA STATE UNIVERSITY
MAIN CAMPUS
Graduate School
bpsugraduateschool@gmail.com
City of Balanga, 2100 Bataan www.bpsu.edu.ph
Based on the Department of Budget and Management Staffing Summary, the number
of government personnel has grown from 1,108, 856 in 2005 to 1,244, 931 in 2015 or a
growth of 12.27%. For the same period, the total number of permanent positions in
government has increased from 1,150,681 in 2005 to 1,433,186 by 2015, or a growth of
24.55%. The corresponding expenditures have also ballooned: the actual expenditures of the
government for personal services (PS) have expanded from P295.18 billion in 2005 to
P682.62 billion in 2015, or an equivalent of 131.26%.
Studies have shown that the existing governmental organization is bloated and
overstaffed, with redundant offices and overlapping or fragmented or ambiguous functions.
The situation calls for the rightsizing of the bureaucracy to promote effectiveness, efficiency
and economy in the delivery of services to the people. Streamlining the operations of
departments/agencies is needed to achieve the government’s goal of maintaining a well-
functioning system of governance. There is a need to rationalize the existing machinery,
reconfigure the organization, contain the costs and expenditures, and streamline operations in
order to fulfill the constitutional mandate of the civil service and maximize the role of the
public sector in national development.
BATAAN PENINSULA STATE UNIVERSITY
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Graduate School
bpsugraduateschool@gmail.com
City of Balanga, 2100 Bataan www.bpsu.edu.ph
House Bill No. 5707 was filed this 17th Congress to improve public service delivery
and minimize, if not totally eliminate redundancies, overlaps and duplication in government
operations as well as to simplify rules and regulations, systems and procedures.
The primary revenue generating engines of a business are its core competencies or
core capabilities. Eliminating non-core aspects of a business may involve closing plants or
offices, selling off non-core operations, consolidating sites or stores, revamping internal
structures, eliminating non-essential or redundant tasks, as well as eliminating layers of
management. Sometimes the restructuring process results in adding or growing sites,
expanding certain operations (often either upstream or downstream operations) or investing
in new lines of business which are expected to become profitable in the future. Many times
internal processes such as sourcing and purchasing are examined and overhauled too.
BATAAN PENINSULA STATE UNIVERSITY
MAIN CAMPUS
Graduate School
bpsugraduateschool@gmail.com
City of Balanga, 2100 Bataan www.bpsu.edu.ph
Since labor is the largest expense for most companies, costs related to headcount and
workforce management get careful scrutiny, and restructuring/rightsizing initiatives typically
result in staff reductions, reassignments or realignments.
Salaries/wages, benefits, overtime costs, and other aspects of labor are all evaluated
on a cost/return basis. Jobs and responsibilities that are not part of the firm’s primary
revenue-generating functions may be outsourced or allocated to outside consultants on a
contractual basis. Part-time and temporary workers may handle tasks previously performed
by full-time workers in order to reduce payroll costs.
Cost-benefit analysis
It often takes years to realize cost benefits from rightsizing/restructuring. In the short
term unemployment claims, severance payouts, and quality or service issues caused by
restructuring can bleed away cost savings. The time and resources dedicated to the
restructuring process itself are often significant. Plus there are costs associated with
retraining, retooling, reorganizing, relocating functions, exiting facilities and terminating
operations.
Moreover, the process takes an emotional toll and impacts productivity as employees
adjust to changes in their locations, roles and responsibilities. Top performing employees
often leave—sometimes taking valuable institutional knowledge and important customer
relationships with them, while those who stay may underperform for a period of time due to
stress, frustration, or lack of skill, knowledge or experience.
BATAAN PENINSULA STATE UNIVERSITY
MAIN CAMPUS
Graduate School
bpsugraduateschool@gmail.com
City of Balanga, 2100 Bataan www.bpsu.edu.ph
Major restructuring initiatives can involve re-financing debt, negotiating bridge loans,
securing new sources of investment, reorganizing departments and reassigning
responsibilities or tasks, combining or eliminating operations, closing facilities, spinning off
subsidiaries or branches, forming partnerships or joint ventures, and various other types of
strategic initiatives.
III. Conclusion
New directions and changes should be compared to and aligned with a company’s
core competencies when making contraction and expansion decisions.
BATAAN PENINSULA STATE UNIVERSITY
MAIN CAMPUS
Graduate School
bpsugraduateschool@gmail.com
City of Balanga, 2100 Bataan www.bpsu.edu.ph
***
References:
https://www.nasscom.in/sites/default/files/uploads/events2012/hr_summit/The%20Right%20Way%2
0of%20Rightsizing.pdf
http://cpbrd.congress.gov.ph/cpbrd.congress.gov.ph/index.php?option=com_content&view=article&la
yout=edit&id=797
https://www.cfoedge.com/blog/operations-management/operational-improvements/restructuring-and-
rightsizing-a-proactive-approach-to-a-management-challenge/