Facility closure management: the case of Vauxhall Motors Luton

• Published in: International journal of operations & production management 2009-06, Vol.29 (7), p.670-691
• Main Authors: Butler, Michael J.R., Sweeney, Mike, Crundwell, David
• Format: Article
• Language: English
• Subjects: Automobile industry; Case studies; Decision making; Downsizing; Employees; Employment; Facilities; Factories; Human resource management; Management decisions; Manufacturing; Operating costs; Operations management; Organizational effectiveness; Production capacity
• ISSN: 0144-3577; 1758-6593
• DOI: 10.1108/01443570910971379

Purpose - The purpose of the paper is to present the findings of a study of factory closure management. It details the sequence and the results of the key strategic manufacturing management decisions made from the time of the announcement of the plant closure to the cessation of operations. The paper also includes an analysis of the human resource management (HRM) actions taken during this same time period and their consequences upon all those involved in the closure management process.Design methodology approach - The case study methodology consisted of two initial site visits to monitor closure management effectiveness (adherence to plan and the types and frequency of closure management communications). During these visits, documentary evidence of the impact of the closure decision upon production performance was also collected (manufacturing output and quality performance data). Following plant closure, interviews were held with senior business, production and HRM managers and production personnel. A total of 12 interviews were carried out.Findings - The case study findings have informed the development of a conceptual model of facility closure management. Information obtained from the interviews suggests that the facility closure management process consists of five key management activities. The unexpected announcement of a factory closure can cause behavioural changes similar to those of bereavement, particularly by those employees who are its survivors. In addition, similar reactions to the closure announcement may be displayed by those who choose to remain employed by the factory owner throughout the phased closure of the plant.Originality value - Facility closure management is an insufficiently researched strategic operations management activity. This paper details a recommended procedure for its management. A conceptual model has also been developed to illustrate the links between the key facility closure management tasks and the range of employee changes of behaviour that can be induced by their execution.