Mini Case:
Acindar’s 10% Salary Cut to Manage Financial Losses
Context:
Acindar, one of Argentina’s leading steel producers, is currently navigating a deep financial
crisis. In response to significant quarterly and annual losses—113.9 million pesos over the
past 12 months—the company has implemented an emergency cost-cutting plan. This
includes a 10% salary reduction for its 3,000 employees, intended to save 80 million pesos
annually.
The company has also begun selling non-essential assets and increasing its exports to
counteract declining domestic demand, which has been especially pronounced in the
construction and automotive sectors. Despite these efforts, Acindar’s long-term recovery
remains uncertain.
According to management, the salary cuts are temporary and may be compensated in
December—if the company meets its financial performance targets. However, trust among
employees may be eroding. Morale, productivity, and internal communication are likely to
be affected by both the cost-cutting measures and the uncertainty around reimbursement.
Acindar’s leadership recognizes that employee and stakeholder trust must be maintained
to avoid deeper internal instability. They are now seeking outside expertise to develop a
clear internal strategy to improve communication, monitor employee sentiment, and
manage the potential fallout of their cost-saving decisions.
Assignment: Consulting Proposal for Acindar
Objective:
Your consulting group has been invited to submit a formal consulting proposal to Acindar’s
executive leadership. The company is seeking advice on how to manage the organizational
risks associated with the 10% salary reduction plan, while also preserving employee
morale, internal transparency, and long-term recovery efforts.
This mini case was written by Professor Sarah Cordero Pinchansky with assistance from ChatGPT, based on
news reports published by Reuters and other relevant materials. It is intended solely as a basis for class
discussion, and not as an example of effective or ineffective management or decision-making.
Your Proposal Should Include:
1.
Executive Summary (1 page)
•
A concise overview
recommendations.
of
the
problem,
your
team’s
approach,
and
•
Written as if it will be read by top management before the rest of the proposal.
key
2. Problem Statement
•
Clearly define the core issue(s) Acindar is facing.
•
Go beyond financial losses to identify the organizational and reputational risks.
3. Objectives
•
What are the desired outcomes of your consulting engagement?
o
(e.g., restore employee trust, evaluate effectiveness of the salary cut
strategy, improve internal communications, etc.)
4. Information Needed
•
What data does your team need to diagnose the issue effectively?
o
Financial performance data
o
Employee feedback and morale
o
HR policies and communications
o
Market and competitor benchmarking, etc.
5. Methodology
•
Describe your research plan.
•
Indicate how you will gather the information (e.g., interviews, employee surveys,
HR data analysis).
•
State whether you’ll use projective techniques and why (e.g., to surface underlying
employee attitudes that may not be expressed openly).
Method
Purpose
Pros
Cons
Anonymous
Surveys
Focus Groups
Measure morale, trust, and
sentiment
Explore employee
perspectives in depth
Analyze absenteeism,
turnover, etc.
Fast, scalable
May lack nuance
Qualitative richness
Risk of bias or fear
Objective
performance data
Requires internal
access
HR Data Review
6. Anticipated Challenges and Solutions
2
•
Identify 2–3 potential limitations of your approach (e.g., lack of employee trust,
limited access to financials, leadership resistance).
•
Suggest concrete solutions to address each one.
7. Timeline
•
Provide a realistic schedule for your proposed consulting engagement.
•
Include major phases: planning, data collection, analysis, recommendations, and
final delivery.
8. Deliverables
•
What will Acindar receive at the end of your engagement?
o
Final report with findings and recommendations
o
Presentation to executives
o
Employee communication toolkit, etc.
9. Conclusion
•
Summarize the impact your proposal will have.
•
Emphasize how your plan helps Acindar navigate financial recovery without
sacrificing its people or long-term reputation.
� Submission Guidelines:
•
Length: 6–8 pages (excluding appendices)
•
Format: Professional consulting proposal (PDF or Word)
•
Include: Team name, contact info, date
•
Due Date: September 1, 2025
�Tips for Success:
3
•
Think like external consultants: focus on clarity, structure, and business value.
•
Use real-world consulting tone: persuasive, data-driven, and practical.
•
Address both business and human aspects of the crisis.