An analysis of the various reasons for downsizing

Some answers are obvious, while others are speculative but certainly plausible. Niccol, who left Taco Bell to run Chipotle, is clearly looking to poach talent from his former fast-food employer, said restaurant consultant Jeffrey McNeal, president of Fessel International Hospitality Consultants in Southern California. Brandt served as chief brand and marketing officer at Taco Bell, and worked with Niccol on some of the Irvine, Calif. Niccol, who lives in Newport Beach, tapped Brandt 15 days after he started at Chipotle.

An analysis of the various reasons for downsizing

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Reasons for Downsizing

Reasons for Downsizing Corporate downsizing has been the biggest fallout of the troubled times the world is witnessing. As we continue our efforts to revive the economy, downsizing has become a stark reality. BusinessZeal Staff Much of what is called investment is actually nothing more than mergers and acquisitions, and of course mergers and acquisitions are generally accompanied by downsizing.

It has become a legitimate option for business growth strategies, especially after the s. It is in fact, the most preferred option of companies to sustain operating costs and comply with the existing scope of the business.

It is an important management venture, and requires large assistance from the human resource management team. Let's have a look at all the reasons that may compel an organization to resort to downsizing. Merging of Two or More Firms When a certain firm combines its operations with another firm and operates as a single entity, in order to stay in profit or expand market reach, it is called a merger.

In case of a merger, certain positions become redundant. The same work is done by two different staff members. Usually, in such a case, the company cuts staff to eliminate redundancy in work.

It is characterized by some employees leaving an organization voluntarily, or by layoffs, especially in case of higher management positions. Acquisition If one organization purchases another, there is a definite change in the management, and the staff of the acquired company has to face the prospect of unemployment.

The reason for this is the same as the earlier case, viz, to cut costs and increase revenue. Change in Management A change in the top brass of a company can also result in downsizing.

An analysis of the various reasons for downsizing

The working methods and procedures vary with different management teams. Therefore, a significant change in the management may drastically affect the employee size, to suit a particular style of working.

Economic Crisis This is the single biggest cause of downsizing. Often, it consists huge layoffs by a number of organizations across various domains.

The recent economic recession triggered a number of layoffs in many reputed and popular firms around the world. According to a survey conducted by the US Bureau of the Census, organizations consisting of a higher percentage of managerial staff downsize more than the ones with a higher percentage of production process employees.

Strategy Changes Some companies may reduce certain areas of operation and focus on other areas. For example, if a company is working on a project in which there are no assured returns, it may downsize its employees working on that particular project.

Causes of Employee Downsizing |

It will then focus its resources on specific projects which could be profitable ventures. Excessive Workforce In a period of high growth, a company hires excess staff to meet the needs of a growing business. However, in times of recession, the business opportunities dwindle, leading to the need for downsizing of the surplus staff that was hired.

Automation If an organization work process is extremely fast and easily meets the requirements of the market, it may downsize some of its workforce. Similarly, if manual work can be done by a machine in a much better and cost-efficient way, that also results in the reduction in the number of employees.

Outsourcing Organizations catering to international markets require a huge and efficient employee base. If this labor can be obtained by 'exporting' the job to other countries, a huge downsizing takes place in the parent country.

For instance, if a certain job can be done more effectively in India, and is more economically viable there than in the United States, then processes would be shifted out to cut costs.

Downsizing is a rampant practice prevalent these days. Efficient management of the existing skill set and constantly acquiring new skills and education is a sure way to beat the effects of downsizing.Why Businesses Downsize.

Economic motivations are the most common reason for downsizing. With credit markets frozen by the U.S. economic slowdown, many employers felt they had few options, according to an analysis by University of Colorado business professor Wayne F.

Cascio. Causes and Effects of Employee Downsizing: A Review and Synthesis. on the assessment of the reasons for downsizing, procedures that have been implemented and the treatment of the personnel. Reasons for Downsizing Corporate downsizing has been the biggest fallout of the troubled times the world is witnessing.

An analysis of the various reasons for downsizing

As we continue our efforts to revive the economy, downsizing has become a . An analysis showed that the literature has sensationalized the health-related problems because only about 20% of the people surveyed acknowledged there was a problem.

Possible Strategies (Interventions) to Use for Change

There are many reasons for downsizing. Many factors are evident, such as acquisitions and It helps individuals to cope with various tense situations (N ational Institute.

Analysis. Implication of Downsizing. Jan 12, in Analysis There are various reasons as to why downsizing is put in motion. One of the major reasons that allow the flow of this practice is to enable a better performance of a particular organization.

This aspect is practiced when a company may for example wish to replace part of its. Read chapter 11 ORGANIZATIONAL-LEVEL PRODUCTIVITY INITIATIVES: THE CASE OF DOWNSIZING: By one analysis, a 12 percent annual increase in data processing.

Implication of Downsizing