When a business operates in an area where a subsidiary has been set up, there are a number of cultural challenges encountered which requires the cost of operations to be managed. A number of companies have encountered the difficulties in making decisions regarding methods of achieving competitiveness in a new environment such as foreign countries ( Davis et. al., 2015) . Examples of cost-reduction measures implemented are across-the-board pay cuts and layoffs of staff. This ensures a company is able to achieve its expansion objectives such as achieving stability in a new market environment using available resources. This paper explains the benefits of across-the-board pay cuts and reduction in workforces and provides an advice to a Japanese expatriate working in the United States regarding the best option that needs to be implemented ( Davis et. al., 2015) .
The overall benefit of implementing across-the-board pay cuts is that the cost of operating a business becomes low since there is a little cost incurred in the provision of remuneration to employees. It is important because a company is able to meet its operating objectives in a foreign country without the need to seek additional funds. Cost-cutting procedures are important because a subsidiary operating in another country does not have the capability to achieve high sales which can be beneficial. When the payments of all employees are cut, it ensures the board and those in lower positions are affected in an equal manner and there is no bias in reducing the salaries of employees ( Van Dierendonck & Jacobs, 2012) . It ensures the costs of vital activities such as the provision of training to new employees and conducting promotion and market research are met. The proves of reducing the payments to employees across the board is relevant to a subsidiary of a business because it enables the employees to gent benefits for the actual tasks they perform which are usually less intensive compared with the case of an established business.
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The process of cost-cutting is beneficial to a business that is operating internationally because it enables an organization to retain the most competent employees without the implementation of strategies such as laying them off. The company is also able to implement is values and mission objectives in the new subsidiary by retaining employees who understand its strategies of achieving a competitive advantage. The company is able to retain the employees who are able to apply their competence, skills, and abilities to promote its growth after which their remunerations rates can be increased when the business achieves competitiveness ( Davis et. al., 2015) .
There are particular circumstances under which a company that opens a subsidiary in another country may apply layoffs as a method of achieving its operational objectives. Layoffs may be necessary when a company needs to recruit employees from a particular region such as country of operation while the labor cost needs to be kept constant ( Gomez-Mejia et. al., 2014) . Under such circumstances, it will be required that the company recruits employees in the country in which it has set up a subsidiary rather than retaining its employees.
The process of workforce reduction provides companies with the opportunities for developing reorganized strategies of performing operational activities. It ensures a work flow is designed in a manner that the needs of the new market are addressed and a company does not stick to the traditional strategy of marketing its products. Employee layoffs may be important for a company that opts to shift its operational activities from a particular country to another ( Gomez-Mejia et. al., 2014) . This is where the company does not necessarily need the employees of its present country of operation.
Reduction in the workforce also promotes operational agility and an improvement in productivity of the workforce in a subsidiary company. It provides the management of a company with the opportunity to assign tasks to the right people who possess the right skills at the right time ( Van Dierendonck & Jacobs, 2012) . This is specifically important for a startup subsidiary which needs to have a specific strategy of the performance of tasks or provision of services to meet the needs of the target customers. The business will also be able to respond to fluctuating production objectives without impacting the quality of its performance.
Layoffs strategy is also beneficial to a business because it reduces financial and non-compliance risks. A robust work-force management process is effective in ensuring organizations are able to demonstrate compliance with employment rules and mitigate risks associated with non-compliance or other costs. The strategy of layoffs of the workforce is also effective in ensuring customer satisfaction is achieved because a company retains the most competent employees who are able to address the needs of customers in a more effective manner. Organizations that have implemented work-force optimization strategies have been able to achieve high performance and an improvement in customer satisfaction compared with other companies that retain all their employees ( Gomez-Mejia, et. al, 2014) . When the workforce is managed in an efficient manner, it enables companies to advance their brand equity in the new operating environment and achieve competitive sustainable growth.
There are particular conditions under which work force reduction through layoffs is associated with an increase in employee morale and their engagement in the tasks they perform, increase in transparency, and the ability of managers to communicate with employees ( Davis, et. al, 2015) . A unified workforce management strategy ensures the cost of labor is reduced, compliance is increased, and workers are empowered to make better-on-point decisions that support business objectives. The process of downsizing the workforce will enable the company to overcome the impacts of obsolete industries and transform to a modern industry that requires employees that have been laid off. Those who have skills are able to find new jobs in the emerging sectors and contribute to their development rather than being retained by the company ( Davis et. al., 2015) .
An advice for a Japanese expatriate that intends to operate a subsidiary in the United States is to implement the strategy of workforce layoffs as a method of reducing the cost of setting up the new subsidiary. The company can place the employees in a list of employees that have been laid off and recall them back when it has stabilized in its operations. The chances of the company being generally accepted by customers in the United States is subject to the extent to which it addresses the needs of the U.S citizens such as providing them employment opportunities in its subsidiary. Therefore, it is recommended that it should lay-off some of its employees and allocate funds for training of employees of the United States origin as employees in the new subsidiary. It will also be possible to achieve labor mobility objective by keeping abreast of the present skills of managing business activities and contributing to economic benefits.
References
Davis, P. R., Trevor, C. O., & Feng, J. (2015). Creating a more quit-friendly national workforce? Individual layoff history and voluntary turnover. Journal of Applied Psychology , 100 (5), 1434.
Gomez-Mejia, L. R., Berrone, P., & Franco-Santos, M. (2014). Compensation and organizational performance: Theory, research, and practice . Routledge.
Van Dierendonck, D., & Jacobs, G. (2012). Survivors and victims, a meta‐analytical review of fairness and organizational commitment after downsizing. British Journal of Management , 23 (1), 96-109.
