Downsize or Not? Learn from Microsoft’s Experience
Companies all over the world feel the wave of downsizing. Experts ensure that this is an outcome of the rebounding economy. Famous global enterprises including Microsoft, Siemens, Cisco and Walmart cut down their jobs even when they have high-performance rates. So, what’s the rush and is it worth it?
Reasons of Slashing Jobs
The Guardian described that US companies cut more than 1m jobs in 2015. The reason is that some companies perceive their workforce as an obstacle for higher revenues. They want to do more with less and improve the efficiency of spending money.
In 2014, Microsoft reduced a number of external employees and short-term positions to secure their private information and strategy. Nowadays, Microsoft layoffs thousands of employees to upgrade their salesforce. They decided to turn into cloud services mostly according to the new leadership of the company.
Negative Effects of Downsizing
Some people who used to be employed perceive dismissal as a personal drama like divorce. Their quit influences their self-esteem, especially for the middle-aged employees who can struggle to find a new job. On top of that, researches show that large-scale downsizing brings crime and domestic violence.
Also, downsizing may negatively impact an atmosphere in the team, employees will discuss what has happened and what may be in the future. As a result, rumors and anxiety can reduce productivity.
How to Downsize Correctly
Clarity is important to rebuilding trust, so the company needs to declare the scope and timetable of job cuts to help employees be prepared for the changes. Also, open communication helps to prevent rumors and misunderstandings. The truth is that many team members are valuable professionals, and they can match another company’s requirements and improve their wellbeing, but they need more time to do that.
A company needs to develop detailed plan to keep doing the same actions with fewer people on board. Having a clear shared vision is number one to reach needed goals. Without it, the new problems will appear, so companies are advised to build a strong plan involving risk management to fill all the gaps that will occur.
Keep in mind an importance of respecting employees’ dignity and the law. Leaders need to reread laws about age discrimination and civil rights to eliminate possible problems.
The final issue is allowing employees to speak loudly, have a voice and share their thoughts. Companies should make each worker feel valuable and respectful.
So, with these insights in mind, directors can plan ahead a downsizing if the company needs it. Large enterprises feel this demand and can face it while helping the employees to prepare for the quit.
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