Reducing slack: the performance consequences of downsizing by large industrial firms, 1977-93

Love, E. Geoffrey; Nohria, Nitin

doi:10.1002/smj.487

Cited by 238 publications

(66 citation statements)

References 39 publications

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“…Retailers can improve profitability by closing stores; in fact, there are success stories pertaining to companies avoiding bankruptcy through pugnaciously closing underperforming stores (Chowdhury & Sarkar, 2017). This type of activity is highlighted in the organizational downsizing literature (Love & Nohria, 2005). Determining if a store is underperforming is based heavily on sales, and with sales on the decline for many retailers, there is an uptick in the number of store closures.…”

Section: Underperformancementioning

confidence: 99%

Is the Macy's in my mall going to close? Uncovering the factors associated with the closures of Macy's, Sears, and J.C. Penney stores

Tokosh

2018

Growth and Change

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This study analyzes three national department store chains in order to identify the factors most associated with their store closures. A binary logistic regression revealed some consistencies and differences in the associations. Larger stores are less likely to close for all three chains. Macy's and Sears stores are less likely to close in large malls (than freestanding stores) and if they are located in the West. J.C. Penney stores in the west are also less likely to close than in other regions, but stores in large shopping centers are more likely to close than freestanding stores. Store age was only significant for J.C. Penney stores, and indicated that older stores are more likely to close. Implications for retail managers and city economic vitality are mentioned and future research possibilities are discussed.

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Section: Underperformancementioning

confidence: 99%

Is the Macy's in my mall going to close? Uncovering the factors associated with the closures of Macy's, Sears, and J.C. Penney stores

Tokosh

2018

Growth and Change

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“…Prior studies indicated the ambiguous relationship between slack resources and organizational performance as empirical research in this field is not conclusive (Geoffrey Love and Nohria 2005;Daniel et al 2004). Previous management and health studies examined the relationship between the financial resources of the organization and the resulting inconsistent conclusions (Goldstein and Iossifova 2012).…”

Section: Introductionmentioning

confidence: 99%

The Role of Financial Slack, Employee Creative Self-Efficacy and Learning Orientation in Innovation and Organizational Performance

Tran

Nguyen

Nguyễn

2018

Administrative Sciences

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Organizational performance development and financial slack have drawn extensive attention in management research. Recent studies have indicated that financial slack has a positive effect on innovation outcomes and organizational performance. However, some other studies have proposed adverse effects. This paper aimed to explore the causal linkages between employee creative self-efficacy, learning orientation, financial slack, innovation outcomes and organizational performance. It also examined the influence of innovation performance and creative self-efficacy as mediating variables in the connection between learning orientation and organizational performance. By doing so, we used a structural equation modelling (SEM) method to test the model using data from 267 small medium enterprises (SMEs) in Vietnam. The findings illustrated that SMEs had not utilized financial slack to invest in innovation activities and improve firm performance. Furthermore, the results indicated that learning orientation had both direct and indirect impacts on innovation and firm performance. It is worth noting that employee creative self-efficacy had a positive effect on innovation performance. The findings also verified a statistically significant association between innovation and organizational performance. Finally, the results provided some managerial implications to stimulate employees to work creatively and improve innovation outcomes for sustainable development.

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“…The most optimistic account is provided by Cascio, Young, and Morris (1997), who suggest that stable-employers-whose workforce size varies by no more than 5 percent in a given year-perform no worse than frequent-downsizers-whose workforce varies by more than 10 percent per year. However, this result is qualified by more recent work showing that downsizing does tend to improve financial performance under certain conditions; namely, if it (a) is done broadly, (b) is done proactively, or (c) involves a refocusing on core revenue streams (Love & Nohria, 2005;Chalos & Chen, 2002). Interestingly, Orlitzky and Frenkel provide evidence for a "coercive logic where work strain and insecurity associated with fear of unemployment are claimed to be the main forces motivating high performance" (2005: 1329).…”

Section: Different Corporate Policy Optionsmentioning

confidence: 99%

Stakeholder Happiness Enhancement: A Neo-Utilitarian Objective for the Modern Corporation

Jones

Felps

2013

Bus. Ethics Q.

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ABSTRACT:Employing utilitarian criteria, Jones and Felps, in “Shareholder Wealth Maximization and Social Welfare: A Utilitarian Critique” (Business Ethics Quarterly 23[2]: 207–38), examined the sequential logic leading from shareholder wealth maximization to maximal social welfare and uncovered several serious empirical and conceptual shortcomings. After rendering shareholder wealth maximization seriously compromised as an objective for corporate operations, they provided a set of criteria regarding what a replacement corporate objective would look like, but do not offer a specific alternative. In this article, we draw on neo-utilitarian thought to advance a refined version of normative stakeholder theory that we believe addresses a major remaining criticism of extant versions, their lack of specificity. More particularly, we provide a single-valued objective function for the corporation—stakeholder happiness enhancement—that would allow managers to make principled choices between/among policy options when stakeholder interests conflict.

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Reducing slack: the performance consequences of downsizing by large industrial firms, 1977-93

Cited by 238 publications

References 39 publications

Is the Macy's in my mall going to close? Uncovering the factors associated with the closures of Macy's, Sears, and J.C. Penney stores

Is the Macy's in my mall going to close? Uncovering the factors associated with the closures of Macy's, Sears, and J.C. Penney stores

The Role of Financial Slack, Employee Creative Self-Efficacy and Learning Orientation in Innovation and Organizational Performance

Stakeholder Happiness Enhancement: A Neo-Utilitarian Objective for the Modern Corporation

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