FedEx’s Bold Move
I read an interesting article in the Wall Street Journal about cost cutting moves that FedEx is taking during these trying economic times. FedEx’s cost cutting moves are as follows:
1) FedEx is lowering executive compensation. The CEO is taking a 20% pay cut and executives are taking a pay cuts from 7.5% to 10%. Executive bonuses are being eliminated.
2) FedEx is suspending matching contributions for the company’s 401(k) plan. The company is trying to avoid massive layoffs by using matching funds to pay employee salaries.
3) FedEx is implementing a hiring freeze and cutting back on variable compensation. Another attempt by the company to save jobs.
I wish more companies would follow the example of FedEx. FedEx is cutting from the top down. I have no problem with companies tightening their belt when everyone participates in cost cutting. Management and labor are both suffering salary reductions and cutbacks together. Too many companies eliminate employees positions with executive management suffering no loss whatsoever in compensation.
FedEx is setting a good example by asking everyone to make sacrifices so that the company can stay afloat. FedEx is even considering canceling an advertisement for the Super Bowl because they believe that it would not look right to spend more when employees are taking cuts. I wish that more companies felt this way.
Photo by Alaskan Dude
December 19th, 2008 at 9:22 pm
I love positive posts like this! Thanks!
January 27th, 2009 at 4:42 pm
Good move Fed Ex..Thanks for the info
March 25th, 2009 at 11:26 am
I am very thankful for FEDEX,not only what they are doing for our economy,but also taking care delivering packages in one piece to the customer.I think everyone should make the move to FEDEX. In my opinion they are a reliable company.