Corporate Downsizing Essays -- essays research papers

Downsizing has become an extremely popular strategy in todays business environment. Companies began downsizing in the late 1970s to attenuate costs and improve the bottom line (Mishra et al., 1998). The term downsizing was coined to describe the action of dismissing a large portion of a companys hands in a very short period of time. According to online encyclopedia http//en.wikipedia.org downsizing refers to layoffs initiated by a company in order to cut tote costs by reducing the size of the company. Downsizing became a familiar management mantra in the late 1980s and early 1990s. In fact, three jillion jobs were lost between 1989 and 1998 (Mishra et al., 1998). More than 350,000 jobs were lost in 2001 (DeSouza & Donaldson, 2002). Downsizing has become almost a way of life for U.S. companies. Typically, the first round of job cuts are followed by a second round of cuts a short time later. Not everyone agrees with the reasoning behind downsizing. According to an article in the Journal of Banking and financial Services, downsizing is merely a short-sighted business strategy motivated by arrogant CEOs eager to appease shareholders (Unkles, 2001). Others feel downsizing is a necessary tool to ensure business survival in the face of a changing economy. Regardless, the costs of downsizing are high, and the payoffs of downsizing are interracial at best. This paper doesnt serve as an approach to downsizing, rather, it explores the more aspects of downsizing, from when its time to downsize to what steps that can be taken to avoid the extremity altogether. Corporate Downsizing An Overview There are many reasons why a company downsizes. Layoffs began as a way for companies to offset a decline in earnings, but quickly became a popular practice even in companies that were doing well financially. A 1994 survey by the American Management Association lay out that two-thirds of all workers who were laid off were college-educated, salaried employees (Downs, 1995). To day, the term downsizing is used to refer to a narrow effort to reduce the workforce and also to widen efforts to improve work systems or redesign the total organization. Companies may downsize to increase capital, as a result of a merge with another company (where supererogatory staff are not needed), poor cash flow (which results in payroll issues), changes in technology, and lastly due to a chang... ...k Enterprise. Retrieved April 22, 2009, from http//www.findarticles.comDowns, A. (2005). Corporate executions the ugly justness about layoffs-how corporate greed is shattering lives, companies, and communities. New York AMACOM-American Management Association. Hoskisson, R., & Hitt, M. (2004). Downscoping How to tame the diversified firm. Oxford University PR on Demand. Krepps, M. (2007). Industrial inefficiency and downsizing A study of layoff and arrange closures. New York Garland Publishing.Mishra, K. E., Spreitzer, G. M., & Mishra, A. K. (2008, Winter). Preserving employee m orale during downsizing. Sloan Management Review. Unkles, j. (2009). The downside of downsizing after almost a decade of surging economic growth and booming share markets, many corporate and financial managers are getting their first look at a downturn in the business cycle. Journal of Banking and Financial Services, 115(6), 2. Retrieved April 22, 2009, from Baker College net Site http//web2.infotrac.galegroup.comZimmerman, E. (2007, November). Why deep layoffs hurt long-term recovery (HRs tools for recovery). Workforce. Retrieved April 20, 2009, from http//www.findarticles.com