Counting the cost of restructuring

The redundancies facing Diageo workers in Scotland are an unfortunate sign of the times. All businesses are currently looking at how they operate, to see if they can do so with fewer resources.

Few organisations will be immune from this sort of thing between now and whenever the economy turns the corner. There's no doubt many more jobs will be lost before then.

In Diageo's case, however, it is the scale of the proposed job losses in one place that has raised the profile of what the drinks giant sees as a necessary move to take the business forward, and which its opponents see as just corporate greed.

Workers' groups say Kilmarnock, where the world famous Johnnie Walker whisky brand is currently bottled, will be badly hit if Diageo shuts down the facility. Diageo says it is in consultation with all interested parties and it argues it's creating jobs elsewhere as part of the restructuring it is proposing. The unions, meanwhile, have pledged to fight job cuts.

It is an unpalatable fact about capitalism that businesses have to make tough and often unpleasant decisions in times like these. But whatever the financial motive, the social impact of such moves should also be taken into account.

We don't operate in a planned economy, yet cutting a swathe through communities by closing down the sole - or at least a key - source of employment is fraught with issues.

Accusing Diageo's management of corporate and even personal greed is overdoing it, to my mind.

But if the job cuts go ahead as planned the company must bend over backwards to show it isn't about to dump hundreds of workers on the dole without the right sort of compensation and without working with local communities to get these people back into gainful employment.