Effects Of Downsizing In Globalization

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With the globalization, the incidences of downsizing practice have increased across economies to deal with the requirements of increasing competition. The initial concept of downsizing was tried in economies like US during the 1990s to deal with the Japanese competition. These organizations, even introduced the concept of temporary work contracts (Littler, 2000). These strategies later became one of the major intervention strategy for organizational change across the economies. (French & Bell, 2003). Downsizing affects both, a) organizational performance outcomes, and b) individual response . Response to downsizing can be divided into three categories, 1) victims (Those who have lost job owing to layoffs), 2) the survivors (Those who managed…show more content…
This leads to over workload which at times leads to inefficiencies, conflict, and low morale of employees . (Brockner, 1988). At times, downsizing may lead to reduced commitment of employees to the organization (Brockner, Konovsky, Cooper Schneider, Folger, Martin & Bies, 1994) , drop in attachment with the organization (Spreitzer & Mishra, 2002), withdrawal (e.g., Brockner, 1988) and at times,adversely affect self-esteem of the survivors (Wiesenfeld et al., 2001). Implementers. Implementer are those responsible for executing the downsizing process. They will normally face resistance while implementing downsizing interventions and at times it may even turn violent . The process is bound to affect the morale and motivation level of employees , which manifest through absenteeism and adversely affects the efficiency of the organization (e.g. Paterson & Cary, 2002) which affect performance and productivity ( Brockner, Grover, Reed--Attributes of Downsizing . Cameron et al(1993) has highlighted the following four attributed of downsizing.…show more content…
Downsizing can be both , reactively or proactively to enhance profits by containing expenditure on manpower and also enhance efficiency. 4) Work processes . Downsizing activities will normally lead to changes in the work processes through restructuring and redesigning / eliminating some of the work, or some redesign. With the reduction in the manpower , fewer employees will be required to perform the same amount of work. This would require redesigning of the work process and how it needs to be done (Cameron,1994). Downsizing has gained popularity in the industry and is getting coverage in leading publications such as the Wall Street Journal ,Time, Business Week, Fortune, The Washington Post, and other business publications. Downsizing

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