Sonoco Products Hr Evaluation
Team X-Treme Road Rage
MGS 3400
Ms. Lauren Killion
July 14, 2009
Evaluation of Sonoco Products Company’s Human Resources Company
Since its inception in 1899, Sonoco Products was a company that could be described as constantly growing and thriving. Throughout most of the twentieth century, the company enjoyed uninterrupted growth and financial success. Most of its success could be attributed to the company’s ability to adapt to new packaging materials and technologies as they were developed. However, during the late 1990s, like many other manufacturing and packaging companies, Sonoco’s profitability was threatened by the fact that its operating costs were significantly higher than those of companies overseas, particularly Asian companies. Because of this decline in income, Sonoco knew that it had to make sweeping changes to help lower costs, improve employee productivity, and make provisions for future success. One of the ways that new CEO Harris DeLoach knew he could cut costs was by restructuring the human resources department. He then instructed Cindy Hartley, his senior vice president of human resources, to create a new, restructured HR organization that would not only cut costs but would also accomplish three objectives. Her three objectives were to create a system of consistent HR policies and procedures, increase general managers’ accountability for employee development and retention, and to provide customized support for each branch of the business. Additionally, it was clear that Sonoco had communication issues that the revised setup would improve.
As previously mentioned, during the mid to late 1990s, the biggest issue facing Sonoco Products was the need to reduce its operating costs in order to maintain its desired profit margin. The majority of this report will be on Sonoco’s efforts to restructure their human resources systems as a means of cost-cutting. However, that restructuring was only a small component in the cost-lowering
MGS 3400
Ms. Lauren Killion
July 14, 2009
Evaluation of Sonoco Products Company’s Human Resources Company
Since its inception in 1899, Sonoco Products was a company that could be described as constantly growing and thriving. Throughout most of the twentieth century, the company enjoyed uninterrupted growth and financial success. Most of its success could be attributed to the company’s ability to adapt to new packaging materials and technologies as they were developed. However, during the late 1990s, like many other manufacturing and packaging companies, Sonoco’s profitability was threatened by the fact that its operating costs were significantly higher than those of companies overseas, particularly Asian companies. Because of this decline in income, Sonoco knew that it had to make sweeping changes to help lower costs, improve employee productivity, and make provisions for future success. One of the ways that new CEO Harris DeLoach knew he could cut costs was by restructuring the human resources department. He then instructed Cindy Hartley, his senior vice president of human resources, to create a new, restructured HR organization that would not only cut costs but would also accomplish three objectives. Her three objectives were to create a system of consistent HR policies and procedures, increase general managers’ accountability for employee development and retention, and to provide customized support for each branch of the business. Additionally, it was clear that Sonoco had communication issues that the revised setup would improve.
As previously mentioned, during the mid to late 1990s, the biggest issue facing Sonoco Products was the need to reduce its operating costs in order to maintain its desired profit margin. The majority of this report will be on Sonoco’s efforts to restructure their human resources systems as a means of cost-cutting. However, that restructuring was only a small component in the cost-lowering