2020
DOI: 10.1177/0312896220970609
|View full text |Cite
|
Sign up to set email alerts
|

The effect of downsizing on innovation outputs: The role of resource slack and constraints

Abstract: Although the practice of downsizing is prevalent, its effects on organisational outcomes remain poorly understood. This article examines how and when downsizing affects organisational innovation. Using a unique data set of UK firms over a period of 22 years, we test the effect of downsizing on innovation outputs by considering the moderating role of resource slack and constraints. We argue and empirically demonstrate that downsizing has a dual effect on innovation, contingent on the firm’s level of resources. … Show more

Help me understand this report

Search citation statements

Order By: Relevance

Paper Sections

Select...
2
1
1
1

Citation Types

0
7
0

Year Published

2022
2022
2024
2024

Publication Types

Select...
6
1

Relationship

0
7

Authors

Journals

citations
Cited by 11 publications
(7 citation statements)
references
References 87 publications
0
7
0
Order By: Relevance
“…Pros and Cons of Layoffs Note: Adapted from "Layoffs and downsizing implications for the leadership role of human resources" by Mujtaba, B., & Senathip, T. (2020). Journal of Service Science and Management, 13(02), p. 214. https://doi.org/10.4236/jssm.2020.132014 Ramdani et al (2021) found that downsizing could affect an organization's innovation outputs positively, especially when that organization is experiencing a shortage of resources. For organizations experiencing shortage or a lack of resources, downsizing has proven to yield positive results firstly because, employees may begin to compete with one another, leading to superior performance and increased creativity, out of concern that they would lose their jobs in potential future rounds of downsizing (Ramdani et al 2021).…”
Section: ____________________________________________________________...mentioning
confidence: 99%
See 1 more Smart Citation
“…Pros and Cons of Layoffs Note: Adapted from "Layoffs and downsizing implications for the leadership role of human resources" by Mujtaba, B., & Senathip, T. (2020). Journal of Service Science and Management, 13(02), p. 214. https://doi.org/10.4236/jssm.2020.132014 Ramdani et al (2021) found that downsizing could affect an organization's innovation outputs positively, especially when that organization is experiencing a shortage of resources. For organizations experiencing shortage or a lack of resources, downsizing has proven to yield positive results firstly because, employees may begin to compete with one another, leading to superior performance and increased creativity, out of concern that they would lose their jobs in potential future rounds of downsizing (Ramdani et al 2021).…”
Section: ____________________________________________________________...mentioning
confidence: 99%
“…Journal of Service Science and Management, 13(02), p. 214. https://doi.org/10.4236/jssm.2020.132014 Ramdani et al (2021) found that downsizing could affect an organization's innovation outputs positively, especially when that organization is experiencing a shortage of resources. For organizations experiencing shortage or a lack of resources, downsizing has proven to yield positive results firstly because, employees may begin to compete with one another, leading to superior performance and increased creativity, out of concern that they would lose their jobs in potential future rounds of downsizing (Ramdani et al 2021). Likewise, reallocation of employees to form new teams will foster creativity because these employees will bring together knowledge from all areas of the organization, and these newly formed relationships could be a rich environment for creativity.…”
Section: ____________________________________________________________...mentioning
confidence: 99%
“…Note: Adapted from "Layoffs and downsizing implications for the leadership role of human resources" by Mujtaba, B., & Senathip, T. (2020). Journal of Service Science and Management, 13(02), p. 214. https://doi.org/10.4236/jssm.2020.132014 Ramdani et al (2021) found that downsizing could affect an organization's innovation outputs positively, especially when that organization is experiencing a shortage of resources. For organizations experiencing shortage or a lack of resources, downsizing has proven to yield positive results firstly because, employees may begin to compete with one another, leading to superior performance and increased creativity, out of concern that they would lose their jobs in potential future rounds of downsizing (Ramdani et al 2021).…”
Section: Pros and Cons Of Layoffsmentioning
confidence: 99%
“…Indeed, on the one hand, positive implications of downsizing have been highlighted in extant research, such as decreased bureaucracy, lower costs, accelerated decision-making, facilitated communication, enhanced corporate entrepreneurship initiatives and increased productivity (Cascio, 1993). On the other hand, scholars have also highlighted negative implications, such as decreases in employee morale and commitment (Cascio, 1993), decreases in overall firm effectiveness (Day et al , 2012) and decreases in innovation performance (Ramdani et al , 2020). Furthermore, the market’s reaction to downsizing intentions may be influenced by contextual factors, as the market may appraise downsizing caused by a poor demand environment negatively and may welcome downsizing aimed at improving efficiency (Palmon et al , 1997).…”
Section: Literature Reviewmentioning
confidence: 99%