Until a company closes its doors downsizes staff many are unaware
that a business is much more then the product and services it provides. Great
leaders are fully aware that lasting companies are cornerstones of communities.
Maybe this is why the Bible states “whosever aspires to be an overseer desire a
noble task” (1 Timothy, 3:1). When mangers protect the quality, product,
culture, money and reputation of a company they are providing they are doing
much more than giving their time to a company. They are helping provide
financial, medical and emotional support to the community they are serving. The
job of a leader is a task that should not be taken lightly, without proper
management of a organization many people lives could be adversely effected.
The purpose of downsizing is usually caused by restructure
companies, mergers, technological changes, or in order to increase or maintain
profits during difficult economic times (Gomez- Mejia, Balkin, & Cardy,
2012). Research has conclude that this may be a effective strategy for the
short term but, when business increases in the future the retraining,
recruitment and rehiring of employees, could be of greater economic consequence
than keeping the employees during economic hardship (Gomez- Mejia, Balkin,
& Cardy, 2012). Often during downsizing, strategies such as offering
incentive to retire early, job sharing, using retired consultants, downsizing
by employees, using evaluations and seniority occur (Mirabal & DeYoung,
2005). Downsizing has psychological effects on the remaining individuals within
the organization, referred to as survivor syndrome (Mirabal & DeYoung,
2005). Studies indicate that downsizing rarely has positive effects on employee
productivity, as once thought by many management theorists (Munoz – Bullon
& Sanchez –Bueno, 2011). Survivor syndrome is a feeling of apathy, loss of
loyalty and will I be next questioning (Mirabal & DeYoung, 2005).
Employee often believes that their security and advancement within
the company are jeopardized, because of the downsizing (Mirabal & DeYoung,
2005). Survivor syndrome has a great inpact on the productivity, profits and
reputation of an organization (Mirabal & DeYoung, 2005). Management theorist now believe that a
proactive approach of deciding what to do during events that the company many
face, in the future, creative staffing and communicating business intentions
and strategies to employees, would prevent many future layoffs and survivor
syndrome( Mirabal & DeYoung, 2005).
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