In some corporate situations, changes in business environment and needs or budgetary provisions will call for downsizing of some of the staff members. If a company's executive has demanded that this decision should be enforced, the human resource department considers eliminating some employees on the basis of several factors such as whether the company lacks funds to fully support its current staffing needs, the positions that will be downsized, how to notify the affected employees on the decision to relieve them of their duties and a consideration of an alternative plan other than layoffs.
When making layoff decisions, the organizational strategy is a crucial element whose consideration will ensure that the new action plan does not result in outcomes that deviate from the overall business objectives or vision. According to Gandolfi and Hansson (2011), downsizing creates financial, human resource and managerial consequences within any organization that implements this strategy. The possible negative managerial repercussions include the loss of creativity within the organization's remaining workforce, low productivity and morale whereas the consolidation of decision-making at the top management, more efficient communication, less bureaucracy and reduced overhead costs are some of the positive managerial consequences.
After conclusively deciding that downsizing will be the best strategy to save an ailing business, it is necessary to consider an effective approach that will allow the process to run smoothly. Beatty (2011) states that the human resource officials should first plan in advance where they pinpoint the potential layoff conditions and also ensure that the business becomes proactive and ready to address any potential threat. Secondly, an exploration of other options such as redeployment should be made to enhance flexibility in the chosen course of action. Communication is also a key component when downsizing where the management adopts an empathetic, direct and honest technique with the affected employees. Finally, the staff members that will be eliminated should be assisted both emotionally and financially to minimize their potential losses and ensure that they recover in due time and find new jobs.
After downsizing, the company has an obligation to fill the gaps left by the dismissed employees and ensure that the productivity levels are not adversely affected. This responsibility will principally require that the remaining workers are motivated to conduct their usual duties and any extra ones. Given that the company may not award them an adequate pay-rise immediately due to financial constraints, it is advisable that the executives meet with the employees to discuss their wishes and let them know that their supervisors will always be ready to address job queries and efficiency issues.
Beatty, C. (2011). Downsizing best practices. Retrieved from https://www.slideshare.net/cbeatty/downsizing-best-practices
Gandolfi, F., & Hansson, M. (2011). Causes and consequences of downsizing: Towards an integrative framework. Journal of Management & Organization, 17(4), 498-521.
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