Downsizing

Downsizing

According to Gandolfi in the article, “learning from the past-downsizing lessons for managers”, downsizing is a practice that has been adopted by both companies and government from 1970s. Initially, downsizing was a way of responding to organizational and economic crises but over the years, in late 1980s, it was adopted as a restructuring strategy. Nowadays, it is applied in many organizations and companies. Downsizing in one way or another affects the organization as well as the person affected. It has financial, organizational and human consequences in the sense that all these parties are affected either positively or negatively. On the financial effects, downsizing enables an organization to improve in its financial performance. However, it is not always that an organization reaps financial improvement after downsizing. Downsizing has psychological effects on the victims as well as the survivors.

Various key issues in the article are important for an organization affected by downsizing. These include need to train the victims on how to manage the shock, reasons for downsizing and dealing with the consequences of downsizing. Victims of downsizing are human beings and have responsibilities. Terminating their employment denies them an opportunity to get an income and execute their responsibilities and duties. The affected employees receive such information with shock and sorrow and it affects their psychology to an extending of impairing their health. It is therefore appropriate that managers or executives train, and orient them on how to adapt their lives even when out of employment. The victims should be informed in advance to allow them prepare. This will avoid shock and development of stress that might affect their entire lives. They should be counseled on how to cope up with the situation, appreciated and be informed on why the company decided to relinquish their services. Furthermore, they should be advised on how they can cope with the situation and advised on many opportunities that they can utilize to get another job. This will enable them to take the downsizing positively and even if they leave, the organization and the victims will be in good terms.

Informing victims why the company decided to downsize is very important for the victims, the employees and the organization in general. For victims, it helps them to cope with the situation in a positive way, for employees, it shows that the organization is carrying out its functions in a professional manner and therefore their security is guaranteed, and for organization, it helps to make the image of the organization positive.

Dealing with aftermath after downswing is equally an important part in ensuring that the organization continues with its services well. After downsizing, victims as well as employees are filled with mercy and pity. These emotions may affect the performance of the organization if inadequate measures are put in place. The image of the organization in the public may also be affected negatively if the process was not carried out on valid reasons. Therefore, an organization is likely to suffer from low productivity hence lead to reduced level of profit. Therefore, organizations should come up with strategies that will helps to return the situation or the operations of the organization to normalcy.

In conclusion, downsizing is a process that may be done based on multiple reasons but the most important things that the managers need to consider is to conduct it in a professional manner to limit its consequences to victims, employees and organizations.