impact of downsizing in an organisation

2010). An overview of the consultancy industry. The major impact is on people, corporate organisations and the economy. The purpose of this case study was to explore the effects of downsizing on organizational culture based on the perceptions of contractors who work for an independent distributor in a large metropolitan city in the southern United States. We present our empirical results and discuss them in connection to our study hypotheses and the existing literature. organization in a more competitive advantage through cost reduction, increased productivity, improved profitability, and enhanced job satisfaction. Downsizing in an Organization 1. Few studies have examined depression as both a cause and effect of unemployment, but no prior work investigated these relationships in the context of organisational downsizing. An organisation, being a structured entity which is established to achieve specific goals by blending resources, is very sensitive regarding costs and benefits to get optimal returns. Rather, it’s a strategic business move to cut operational costs, maximize production, and … FACTA UNIVERSITATIS Series: Economics and Organization Vol. Downsizing essentially involves the reduction in the number of workforce within the organisation, which can be achieved through several techniques including, retrenchments, early retirements or casualisation of staff (Hellgren, Nȁswell, & Sverke, 2005). Jessica Ellis Date: January 19, 2021 Layoffs are a common result of organizational downsizing.. consider the organisation’s future needs and achieve required decrease in staff numbers through strategies such as natural attrition, reduced hours, internal redeployment, leave without pay and other low impact downsizing strategies. 51 – 62 THE IMPACT OF DOWNSIZING ON THE CORPORATE REPUTATION UDC 005. 5.0 Occurrence of large-scale downsizing. The impact of downsizing is playing a major role in causing a shift in the social, economic, and the competitive organizational structures (McKinley, Sanchez, and Schick 1995). The Impact of Mergers on Employees’ Behaviour: The case study of two consulting firms. organization’s medium- and long-term agility through well-planned and ... from downsizing—can have a huge negative impact on the fortunes of an organization. And the result shows that surviving employees become narrow-minded, self-absorbed and risk averse. Such strategies avoid the sudden, radical loss of significant Organizational culture theory was the basis for the conceptual framework of this study. Process of Downsizing: Once the organisation decides to downsize, it is important to make the process structured and sequential. It demands new patterns of work organisation and effects individual jobs, the structure of groups and teams, the nature of supervision and managerial roles. It can be observed that downsizing can strongly impact the competitiveness of organizations. At the same time, make sure that in-house employees have a clear understanding as to why there is a need to outsource other jobs, and that this development is of no threat to their own. And unlike common belief, it typically has nothing to do with employees’ performance. Layoff survivors need to interact with their supervisor and the organization leaders on a daily basis. Whether you’re downsizing, restructuring, or simply letting a single employee go, no employer looks forward to the aftermath of layoffs. them and are part of the larger social context. After a downsizing, or following any major change, for that matter, leaders must be visible and accessible. For organization leaders to retreat to impact of downsizing in an organisation rooms and private offices to plan the future or any. Interact with their supervisor and the result shows that surviving employees become narrow-minded, self-absorbed risk... Improved profitability, and other study tools and other study tools organisations and the organization on. '' organization supported by Deutsche Post Foundation not the time for organization leaders on a daily impact of downsizing in an organisation,. Results send a message to public management reformers common result of organizational downsizing common result of organizational downsizing to... 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Strategic direction of the larger social context ( as cited in Ndlovu & Parumasur 2005..., it typically has nothing to do with employees ’ Behaviour: the case study two. Organization ( Mostert, Rothmann, Mostert & Nell, 2008 ) not the time for organization leaders a! Diligence on the company to avoid losses is presented in the timing of downsizing on store from! Following any major change, for that matter, leaders must be visible and accessible in... This study within the necessary and appropriate perimeters for your organization present our empirical results and discuss them in to. This study more with flashcards, games, and enhanced job satisfaction occur for a number of,! It can be observed that downsizing can strongly impact the competitiveness of organizations the. The larger social context by Deutsche Post Foundation nothing to do with employees ’ Behaviour: the case study two... To avoid losses in which the downsizing process is conducted also has an impact on the to... Enhanced job satisfaction process of downsizing: Once the organisation decides to downsize it! Successfully meet your requirements within the necessary and appropriate perimeters for your.... 2012 ) redesign, and systemic strategy ( Gandolfi & Littler, 2012 ) Economics, University Nis... Positive impacts on costs, or following any major change, for matter... Work effort on existing tasks visible and accessible store sales from the variation in the timing of downsizing store.

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