Strategies for successful organizational downsizing

Abstract

Abstract This article reports the results of a study of 30 organizations that engaged in downsizing over a four‐year period. Three questions were investigated: (1) What general strategies are used by organizations to downsize? (2) What are the effects of downsizing on organizational performance? (3) What are downsizing's “best practices?” or, What are the differences between organizations that effectively downsize and those that do not? Three main strategies for downsizing are explained, the managerial actions to overcome the negative effects of downsizing are enumerated, and the best practices of successful downsizing firms are presented.

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