LEIDY JOHANNA ANGEL HERRERA. Updated 26 October Transcript. BENCHMARKING,DOWNSIZING Y RIGHTSIZING. Right-sizing, downsizing and improving the employee and employer In my experience, the following four considerations will set you and your. Downsizing, Rightsizing or Dumbsizing?: Quality and Human “American mana gement adopted quality concepts in order to cut costs and regain. international.
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Besides laying off workers, restructuring efforts may involve closing plants, selling non-core operations, doansizing or merging with related companies, and over-hauling the internal structure of a company.
The jobs and responsibilities that are not considered part of the primary revenue-generating functions are the ones that are frequently downsized. The corporate downsizing trend grew out of the economic conditions of the late s, when direct international competition began to increase.
Table 1 compares the number of temporarily downsized workers with the number of permanently downsized workers. Reports of executive salaries growing in the face of downsizing and stagnant wages for retained employees only fan the flames of this criticism.
Downsizing appears to be an ongoing practice for the foreseeable future. Managers should confer with employees regularly to discuss performance and strategies for meeting the goals.
Companies may lay off a percentage of their employees in response to these changes: Economists argue that this process strengthens the economy and helps it grow. Regardless of whether downsizing is good or bad for the national economy, companies continue to downsize and the trend shows few signs of slowing down.
The aftermath of downsizing also places greater demands on managers to make do with less. These jobs are not actually eliminated, but instead moved out of reach of the employees who lose their jobs to outsourcing. For example, the introduction of the personal computer into the office has facilitated instantaneous communication and has thus reduced the need for office support positions, such as secretaries.
This process also enables companies with growing competitive advantages to maintain their positions in the market in the face of greater domestic and global competition, and it is the difficult but necessary result of the transition toward a global economy.
DOWNSIZING AND RIGHTSIZING
Thus, when companies decide that downsizing is the best rifhtsizing of action, managers should do so in a way that does the least harm to employees and their families. This involves providing employees with clear indications of what is expected of them and how they can meet increased productivity goals. By studying particular tasks and determining their essential components, managers can get rid of unnecessary tasks and eliminate unnecessary jobs altogether. Hence, these efforts frequently have mixed results.
Downsizing and reengineering programs may result from the implementation of new, rightsizihg technology. However, economists remain optimistic about downsizing and the effects of downsizing on the economy when the rate of overall job growth outpaces the rate of job elimination.
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Since companies frequently lose a significant amount of employees when downsizing, they usually must reallocate tasks and responsibilities. Analysts of downsized companies argue that managers should take steps immediately after workforce reductions to provide the remaining workers with the support and guidance they need.
They reason that without downsizing, companies would not remain profitable and hence would go bankrupt when there is fierce competition and slow growth. For some sectors, this trend is projected to be particularly prevalent throughas shown in Table 2.
A trend toward outsourcing jobs overseas to countries with lower labor costs is rihhtsizing form of downsizing that affects some U. For example, governments must sometimes enact programs to help displaced workers obtain training and receive job placement assistance.
Downsizing affects most sectors of the labor market, including retail, industrial, managerial, and office jobs, impacting workers in a wide range of income levels. Department of Labor, Bureau riightsizing Labor Statistics. Downsizing is certainly not limited to the U. Nevertheless, some companies began simply to cut their workforce without determining whether or not it was necessary and without any kind of accompanying strategy. Consequently, downsizing often accompanies corporate calls for concentration righstizing “core capabilities” or “core businesses,” which refers to the interest in focusing on the primary revenue-generating aspects of a business.
Moreover, downsizing can lead to additional problems, such as poor customer service, low employee morale, and bad rightdizing attitudes. This includes taking the time to allow dismissed employees to air their thoughts, instead of laying them off quickly and impersonally, and providing assistance in finding new jobs. To remedy these problems, U.
Therefore, reports used for communication between layers of the rigntsizing corporate hierarchy, for example, can be eliminated. Although critics of downsizing do not rule out the benefits in all cases, they contend that downsizing is over-applied and often used as a quick fix without sufficient planning to bring about long-term benefits.
In essence, they downsized because they lacked new rightsizjng that would have stimulated growth and because their existing product markets were decreasing. Chemical plant and system operators. Instead of laying employees off, critics recommend that companies eliminate jobs only as a last resort; not as a quick fix when profits fail to meet quarterly projections.
In addition, downsizing may stem from restructuring efforts to maximize efficiency, to cut corporate bureaucracy and hierarchy and thereby reduce costs, to focus on core business functions and outsource non-core functions, and to use part-time and temporary workers to complete tasks previously performed by full-time workers in order to trim payroll costs.
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Occupations with the Dightsizing Job Decline, Since downsizing often brings about a flatter corporate structure, the flow of information and communication no longer requires the effort rkghtsizing prior to restructuring. If redundant but nonessential work cannot be completely eliminated, it perhaps can be reduced. Economists point out that despite the downsizing that has become commonplace since the s, overall U.
In contrast to their major competitors—Japanese manufacturers—U. Comment about this article, ask questions, or add new information about this topic: Advocates of downsizing counter critics’ claims by arguing that, through downsizing, the United States has maintained its position as one of the world’s leading economies.
Advocates of downsizing also argue that job creation from technological advances offsets job declines from downsizing.