The Effect of Downsizing on Organizational Performance.
ABSTRACT
This project in on the effect of downsizing on organizational performance. The Statement of Problem identified was that downsized organisations have not improved significantly in their performances and have failed to produce the desired results which thereby undermine the effectiveness of performance in the organisation.
To meet the general objective, the study is focused on the following specific objectives, to determine the effect of downsizing on the quality of output, to determine the effect of downsizing on the volume of sales and to determine the effect of downsizing on the span of control.
The descriptive survey method was used and the research tool was questionnaire. In the analyses, the simple percentage technique was applied to analyse the questionnaires and presentation was done by the use of tables.
The data analysis used was Chi-square formula .The findings from the study shows that Downsizing results in decline in quality of output, volume of sales volume and increases span of control consequently, affecting the effectiveness and efficiency of the organisation.
The study concluded that reduction in size of workforce has not improved corporate organisational performance.
Finally, the solutions and recommendation for this study emphasized that downsizing exercise needs to be carefully planned and executed in order to produce its expected result of expense reduction, increased effectiveness and efficiencies restructuring.
TABLE OF CONTENTS
Tite Page…………….i
Certificat ion Page ……….ii
Approval page ……iii
Dedication………………iv
Acknowledgements ………..v
Abstract…………….vi
Table of contents…….vii
List of Tables……………x
CHAPTER ONE: INTRODUCTION
1.1: Background of the Study………….1
1.2: Statement of the Problem …………5
1.3: Objectives of the Study …. 6
1.4 Research Questions ………… 6
1.5: Research Hypotheses ……. 6
1.6: Significance of Study ………..7
1.7: Scope of the Study………. .8
1.8: Limitations of the Study ……..8
1.9: Definition of Term…….9
Reference ………….10
CHAPTER TWO: LITERATURE REVIEW
2.1 Meaning of Organisation …….12
2.2 Organisational Performance and Measurement of Organizational Performance….16
2.3 Concept of Downsizing…….17
2.4 Types of Organisational Downsizing Operations in Organisation…21
2.5 Factors Influencing Downsizing…… 22
2.6 Reasons for Organisational Downsizing…24
2.7 Stages of Downsizing Process……………27
2.8 Downsizing Implementation Strategy………34
2.9 Downsizing Best Practices ………..38
2.10 Effect of Downsizing on Individuals in the Organisation ….40
2.11 Problems of Downsizing on the Organisation …
CHAPTER THREE: RESEARCH METHOD
3.1 Research Design …….44
3.2 Area of the Study ……….44
3.3 Sources of Data ……45
3.4 Population of the Study …………….45
3.5 Sample and Sampling Technique ……46
3.6 Data Collection Instrument …………47
3.7 Validation of Instrument……..48
3.7: Method of Data Analysis………..48
CHAPTER FOUR: PRESENTATION AND ANALYSES OF DATA
4.1 Analyses of Data ……………49
4.2: Hypothesis Testing…63
CHAPTER FIVE: SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS
5.1: Summary of Findings ………..70
5.2: Conclusion……….72
5.3 Recommendations ….73
5.4 Suggestions for Further Studies……………75
REFERENCE S …….76
INTRODUCTION
1.1 Background of the Study
In the recent times, globalisation has made organisations to become more competitive and complex in the employment and application of resources of production.
Many organisations adjust to practices that will give them an edge over their competitors. To compete effectively, they need to reduce cost, improve efficiency, and as well increase productivity and quality of output.
To cope with this tough competition, many organizations have applied the management tool of downsizing.
Downsizing is a universal phenomenon the business world is experiencing. The major impact is on people, corporate organisations and the economy.
An organisation, being a structured entity which is established to achieve specific goals by blending resources, is very sensitive regarding costs and benefits to get optimal returns.
The main motive for most downsizing activities is the objective of reduction of cost (Casio,1993), an increase of organisation’s level of efficiency, effectiveness, productivity (Gandolfi 2002), and competitiveness (Cameron 1994), and so an overall organisational performance. (Thornhill & Saunders 1998).
REFERENCES
Ahmakjian, L.C. and Robinson, P. (2001), Safety in numbers: Downsizing and the Deinstitutionalization of permanent employment in Japan, Administrative Science Quarterly, 46(4): 622 –658
Ahmed, M. (2006), “Rationalization of Workforce”, The Government Position , The Guardian, June 2.
American Management Association (1998), 1997 AMA Survey on Job Creation, Job Elimination, and Downsizing. AMA: New York Publishers.
Bonham, T. W. (2006), MGT 5312 “Organisational Behaviour Course Notes”, Virginia Polytechnic Institute and State University.
Boroson W et al, (1992) “ Survivors’ syndrome across the Board.
Budros, A. (1999), “A Conceptual Framework for Analyzing why Organizations Downsize”. Organization Science
Cameron, et al (1991), Best practices in white collar Downsizing: managing contradictions. Academy of Management Executive, Vol.5 (No. 3): pp. 57- 73.