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Downsizing and its effects
Corporation downsizing
Conclusion On Downsizing
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The Personal Impact of Corporate Downsizing
Demoralization is the result of a corporate downsizing and if not handled well by the officers of the corporation, the corporation can expect a decrease in; worker efficiency, production, teamwork, and cooperation. Adding to this and equally negative would be increases in; absenteeism, tardiness, mistakes and additional job loss. None of these create a positive work environment. Downsizing also places a large amount of stress on the individual's life outside the workplace as well.
It is very difficult for the remaining employees to continue being productive for many reasons. These people that remain are now the same people responsible to improve the profitability of the organization. Left to work in an environment where an employee feels they have no control over their future, none the less their day to day employment status. They are asked to continue to work not knowing if they or one of their associates or colleagues will be in the next round of layoffs. They have to carry the guilt of being able to continue working while their friends and coworkers are now seeking employment elsewhere. This can have dramatic negative effect on teamwork and one can see a how a metaphor can be drawn between this and troops that go to war do not want to make friends with someone who may die the next day. In that the person you are working with may be the next one to suffer the consequences of downsizing.
Beyond the stresses face...
Internal Summary--Hundreds of people who have been loyal workers to these teams for years will soon be unemployed.
The next problem is poor morale. Morale is the job satisfaction, outlook, and feelings of an employee. Right now, employees do not feel secure within the business and are rebelling against it. They do not have a positive outlook for the future of the business and feel betrayed because of all of the people getting let go. The employees right now have a poor morale due to all these factors.
Over time, this dull pain can erode the self-confidence and passion of even the strongest people, which in turn, affects their spouses and children and friends in subtle but profound ways… Though it may be difficult to quantify, the dissatisfaction of employees has a direct impact on productivity, turnover, and morale, all of which eventually hit a company’s bottom line hard,” (p. ix –
...gree and believe that they could get real results if everyone would consistently apply the company’s principles. I have learned personally in the business world consistency means a lot, all employees should have the same consequences. By letting go employees, managers and executives shows that the rules apply to all levels. It will cause everyone involved to have more respect for the company even if they don’t agree with the decision.
Lewis, J. 2014. Causes of Employee Downsizing. [online] Available at: http://smallbusiness.chron.com/causes-employee-downsizing-38647.html [Accessed: 25 March 2014].
Some of these employees have been complaining about not getting any promotion, and the company doesn’t offer enough benefit. Each time an employee resigns, it cost the company money, and other employees suffer. As an employee of the company, it can
Without understand the negative impacts of turnover, a company may be placing itself in a position that will ultimately lead to their demise. We are going to solve our problems and set our company on the path to success, a success that is not only reflected in our bottom line but also our employees’ morale.
The sense-making approach of unfreezing, changing and freezing (Palmer, Dunford & Akin, 2009) was inappropriate in this scenario. Management has made a decision to reduce their workforce continuously; however, the change does not end with the layoffs, rather, it is a continuous change as they continue to reduce employees and focus on the existing employees’ morale. Middle management predominantly executes sense-making approach by as aligning the company objectives with their employees (Banker, 2012). The sense-making approach may have been the culprit of the communication breakdown between employees and British Airways CEO regarding absenteeism. The processual approach was much more fitting with continuous layoff that will allow them to pursue their next implementation. Processual approach is on-going and focused on long-term results while sense-making approach is a prescriptive change. The sense-making approach might have worked if processual approach was established first during the reduction in force, prior to introducing the swipe card implementation. Preferably, British Airways should have engaged in change management approach first to address the system change in a large scale. Organizational development approach would have assessed the entire organization and discovered that the low morale may
A negative work environment can make employees feel irritable, anxious and defensive. This can cause poor productivity, lack of motivation and poor communication in the workplace which in turn can cause problems for the company. An employer’s abuse of power can cause mental or emotional distress on employees and also disrupt the workplace. Examples of employers abusing their position include humiliation, undermining, disrespectful language, discriminatory comments, yelling and intimidation. When employees are surrounded by this on a daily basis it can affect their self-worth. Employers can resolve these issues by allowing open lines of communication and by not giving employees the impression that it is acceptable to act negatively and disrespect fellow employees.
Voluntary and involuntary turnover have an effect on organizations. Rapid changes in job descriptions, organizational structures, and inter-organizational competitiveness increase the importance of studying turnover and its relationship with organizational change. According to Leana and Van Buren (1999), "the loss of key network members can severely damage an organization 's social fabric and perhaps eradicate its social capital altogether." When businesses lose a high number of employees, problems can occur, costing the company time and money. Some of the costs incurred are associated with training, drug testing, physicals, and orientations to hire replacements that may take several months to learn the job and to achieve competency. There is a saying, “Good help is hard to find---and harder to keep”. This saying refers to good organizations trying to reduce turnover when the competition for retaining good employees is intense.
When a layoff is imminent, a department supervisor should take several important steps before implementation of a layoff. One of the first steps that should be taken is the reduction of all temporary and contract employees. In addition, a hiring freeze needs to be imposed; then, closing open positions can reduce the numbers of employees. These early steps aid in reducing staff, and simultaneously, retains essential employees who can be internally relocated. After these steps are taken, management can further reduce staff by considering offering the incentives of voluntary termination or early retirement (Fallon & McConnell, 2007).
Layoffs are one means by which an organization can reduce expenses with the intent of improving its bottom line. Despite being typically performed as a last resort, layoffs often have a negative impact on the remaining workforce. As a manager, there are numerous areas for concern in managing the workforce going forward. The human costs related to downsizing are “immense and far-reaching” with one of the most profound being survivor syndrome according to Hanson (2015, p. 187). Also known as survivor’s guilt, this condition relates to the emotions felt by those still employed and some of the effects include decreased motivation, moral, and job satisfaction, as well as an increased proclivity to search for other employment. This volunteer turnover being another grave concern for managers, and retention of the remaining workforce is usually dependent on their existing perception of the organization and its culture (Sitlington & Marshall, 2011). Also relayed by
Employee turnover in organization is one of the main issues that extensively affect the overall performance of a workplace (Tariq, Ramzan and Riaz, 2013). Various studies show that employee turnover negatively affect the overall efficiency at the organization (Tariq, Ramzan and Riaz, 2013). Xiancheng, (2013) mentioned the employee turnover is a method of personal issues who decided to stop associate with the company for better advantage. There are two types of turnover which are voluntary and involuntary turnover. Voluntary turnover can be defined as the termination of the official and the psychological contract between the employee and employer (Krausz, 2002; Macdonald, 1999; Mclean Parks et al, 1999; Rousseau, 1995) while involuntary turnover inescapably lead to direct negative results such as current job is insecurity, work difficulty, and status fluctuation (Gowan and Gatewood, 1997). However, other researchers such as Haven-Tang and Jones, (2012) concluded poor management, lack of salary, bad working environment and paucity of job opportunities could be the highest causes of turnover among organization. This statement was support by Kusluvan et al., (2010) where is they had stated that poor management, low payment of salary, work environment and lack of employees’ job opportunities on the organization will make employee want to quit from their job. Turnover intention situation will appear when labour had feeling that they want to quit from current job, so voluntary and involuntary turnover will become final stage for them as their decision (AlBattat and Mat Som, 2013) but it is different for researchers such as Mosadeghrad, Ferlie and Rosbenberg (2013) when they conclude that employee turno...
673), retention management must be based on three types of turnover, voluntary, discharged, and downsizing. Not all businesses are freighted by turnovers, for some it is the way of life and cost is built into the budget. However, for others any type of high turnover can be detrimental for company profit, employee wage and benefits offered. First, let’s take a look at voluntary and involuntary turnover that affects retention. Voluntary turnovers are caused by many different reasons. Turnover may result from topics such as job dissatisfaction, job mismatching, knowing that job opportunities are plentiful. Two reasons that I will discuss more are micromanagement and employee loyalty. Like stated before in the introduction, when employees are dissatisfied, possibly due to being placed in an area that doesn’t fit with their skill set, one is more likely to seek new employment. Another part of turnover is discharging and downsizing. Discharge is just that, members being discharged due to discipline and job performance. While downsizing turnover is a result of business being overstaffed (Heneman III, Judge, Kammeyer-Mueller, 2015, pg. 675). There are also other reasons for voluntarily employee turnover, such as generation differences when it relates to employment. The current generations are more likely to see a job as one piece in their life puzzle rather than as the first, indispensable anchor piece without
It all means a wish to quit and move on to something better and many employees are there right now. I am currently employed at a very popular hospital and I am currently seeing job dissatisfaction first hand. In the department that I work at many employees are showing their true views on how they are unsatisfied with the job. Many people feel that the job is becoming very stressful with the demands from upper management. Many employees are working long hours and are not receiving any recognition for it. In the past few months I have seen many employees quit and move on to other positions. Many of the ones remaining are not even putting 100 percent into their work because they feel like they should not if they will not be recognized for