SLP 4 MGT 491 INTERNATIONAL HRM Essay Example | Topics and Well Written Essays - 750 words

SLP 4 MGT 491 INTERNATIONAL HRM - Essay Example This topic is very important to me and to every human resource manager who has an ambition of working in a big institution. This topic will provide insight on the negative effects of downsizing and layoff. It will also try to provide the solution to the effects that are generated. Downsizing is a strategy used in business; it is intended to improve the economic standing of an organization by either reducing its structure or changing the structure of the human resource so as to reduce operational costs (Mirabal & DeYoung, 2005). It is a word that has come into being due to its popular usage and not precise theoretical construction. It can be interpreted as simply a reduction in the organisation size on the surface. If this surface definition is taken into consideration, it might be confused with the concept of organizationl decline or just a mere decrease in the size of an organizational. Important difference, however, do exist, that differentiates downsizing and decline as different managerial processes (Davison, 2002). Downsizing is not a phenomena that just happens to an organization as an organization decline would, but rather it is undertaken by the management on purpose, this also brings out the differences between downsizing and reduction in the share o f the market or loss of workforce that are attributes of organizational decline. It is also important to note here that downsizing has the aim of improving the effectiveness of the organization and it is not just a mere lack of funds to pay the employees. It can happen a proactive measure or a reactive action to contain the costs or to enhance the revenue of the organization. Downsizing can therefore also be defined as the planned and intended elimination of departmental positions or jobs and is therefore expected to yield rapid economic benefits. People costs often exceed 40 percent of a company’s total budget (Davison, 2002). As a result, cutting