Rightsizing: The Strategic Human Resource Management Challenge of the 1990s

Abstract

Argues that, before rightsizing is considered, human resource management must establish the appropriate human resource plan to give the organization the edge it needs to minimize the upheaval caused by rightsizing and to remain competitive. Rightsizing is inevitably accompanied by changes in the fundamental relationship between the organization and its workforce. Strategic human resource managers of today must comprehend valuable lessons from the past recessional times to remain organizationally lean and to cultivate resolutions to employee problems that are more creative than cash payoffs. Whatever the situation, staff reduction is always difficult, especially in industries where stability and security of employment has been the custom. To survive, managers must not ignore the important factors relating to people management. To deal with these issues managers should avoid certain actions when corporate restructuring becomes necessary. For example, unrealistic promises should not be made and action should not be postponed in anticipation of improvements in the environment. To help with motivating the remaining employees, managers also need to know precisely what the new corporate strategy actually entails and why the changes are being made. A truthful and constant flow of information from top management can minimize the damage that could be caused by rumours and allow employees to concentrate on their main tasks. A major function of human resource management during transitional organizational movement is to support and advise managers in order to reduce complications and disturbances to the organization.

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