The downside of downsizing: managing an organization to its right size

Orpen, Christopher

doi:10.1002/(sici)1099-1697(199707)6:4<195::aid-jsc249>3.0.co;2-p

Cited by 6 publications

(4 citation statements)

References 9 publications

(48 reference statements)

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“…Furthermore, they might apply the grid after the change, thereby gaining an idea of how the change has already affected members and what they should avoid, in an effort to mitigate growing concerns. The detailed diagnosis provided by this article can be of use to managers who have to manage a necessary and essential change and thus need to plan the change with the minimum amount of pain for the "survivors" (Baron & Kreps, 1999;DiFonzo & Bordia, 1998;Orpen, 1997).…”

Section: Discussionmentioning

confidence: 99%

Exploring How to Diagnose Members’ Concerns About Changes in Core Elements of Organizations

Illia¹

2009

The Journal of Applied Behavioral Science

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This study explores Hinkle’s implication grid as a useful technique for identifying the core characteristics of an organization by defining the concerns that members have seeing the core characteristics disappear. Hinkle designed the proposed method to assess how difficult it might be to change a core element of people’s personalities; here, the author has adapted the method and applied it in two different and evolving organizations. These two applications demonstrate the method’s practical value: It can help us avoid the assumption that changing core attributes is painful for an organization’s members, and we can start to measure, in concrete terms, whether pain is actually experienced, what type of pain it is, and in which part of the organization it is most intense. Thus, it is difficult to change these core elements because a person’s capacity to interact socially with others depends on his or her ability to form a mental representation of the group he or she belongs to. Social reality has a coherent structure, and we make sense of organizational events on the basis of this structure, as well as on our own place in the organization.

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Section: Discussionmentioning

confidence: 99%

Exploring How to Diagnose Members’ Concerns About Changes in Core Elements of Organizations

Illia¹

2009

The Journal of Applied Behavioral Science

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“…There are several reasons why downsizing does not lead to desired companies outcomes, such as structural and coordination problems, difficult planning, and delegation of authority (Orpen, 1997). Structural problems are reflected in the fact that the loss of a certain number of jobs, and consequently the dismissal of employees are at the center of the restructuring process.…”

Section: Introductionmentioning

confidence: 99%

“…This activity is accompanied by the definition of a new way of measuring the achieved performance and the design of a system for providing feedback to employees (Campion et al, 2011;Hutchinson et al, 1997). What is very important in downsizing is that human resource managers must constantly keep in mind that employees with specific knowledge, skills and abilities must remain in the company (Orpen, 1997).…”

Section: Introductionmentioning

confidence: 99%

Knowledge Management and Downsizing: Implications for Organizational Performance

Slavković

Bugarčić

Ognjanović

et al. 2021

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Downsizing as a corporate restructuring strategy aims to reduce significantly the number of employees in order for the company to adjust to the reduction of revenues resulting from the influence of environmental factors. Workforce reduction is most often implemented during economic crises, which is why it is associated with ambivalent outcomes. Reducing the number of employees through reducing the budget for salaries can have a favorable impact on reducing costs and thus enable the company to operate in the short term. The departure of employees from the organization is associated with a potential loss of organizational knowledge that can reduce the company’s competitiveness and have a negative impact on business. The purpose of this paper is to identify the impact of workforce reduction on knowledge management and organizational performance. A questionnaire filled out by managers from 75 companies was used to collect data. Correlation analysis and multiple hierarchical regression were applied to determine the relationship between the observed variables. The results showed that downsizing has a statistically significant and negative impact on organizational performance. Knowledge management has a positive impact on organizational performance and reduces the negative impact of workforce reduction on organizational performance during the implementation of downsizing. The obtained results give clear practical guidelines to managers that downsizing can have negative consequences on organizational performance if the protection of organizational knowledge is not taken into account and that managers must focus on knowledge in order to preserve potential for competitiveness and performance. The obtained results have a much broader significance in all those situations (restructuring, digitalization, business model change, etc.) in which the company needs to reduce the number of employees.

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“…Although these strategic practices may have an immediate positive effect on the bottom line, downsizing's long-term financial results have been less than outstanding (Cascio, 1993;Orpen, 1997;Palliam & Shalhoub, 2002). Palliam and Shalhoub (2002) conducted an empirical study whose sample consisted of 185 large publicly-held U.S.-based corporations that had publicly announced intentions to downsize between 1990 and1992 and subsequently conducted the layoffs.…”

Section: Background To the Studymentioning

confidence: 99%

Living on Both Sides of the Fence: A Phenomenological Study of Human Resource Development Professionals as Downsizing Survivors and Strategic Human Resource Development Facilitators

Nackoney¹

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The downside of downsizing: managing an organization to its right size

Cited by 6 publications

References 9 publications

Exploring How to Diagnose Members’ Concerns About Changes in Core Elements of Organizations

Exploring How to Diagnose Members’ Concerns About Changes in Core Elements of Organizations

Knowledge Management and Downsizing: Implications for Organizational Performance

Living on Both Sides of the Fence: A Phenomenological Study of Human Resource Development Professionals as Downsizing Survivors and Strategic Human Resource Development Facilitators

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