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Downsizing and Growth - Change Management in Turbulent Times

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Please help with a response for the following:

Use Forbes Magazine "layoff tracker". Forbes Magazine's Layoff Tracker at the following website:
http://www.forbes.com/2008/11/17/layoff-tracker-unemployement-lead-cx_kk_1118tracker_2.html

When you've read through the Background materials and any other sources that you want to track down, you should check the Layoff Tracker to see what's happening in your geographical area (if possible) and perhaps your professional area as well.

Response Expectations:
Discuss issues relating to growth and downsizing in general, with emphasis on:

1)The patterns that you see emerging from the Layoff Tracker
2)The emerging issues in this area -- how will the problem be seen in the coming years
3)HR activities that should occur to effectively implement downsizing, and also to effectively implement growth.
4)Approaches to managing change in an organization that is growing or shrinking in size.

***Please use two required readings in this response:
Anonymous (n.d.). Tips for handling layoffs. HRM Guide. Retrieved 08/17/09 from http://www.hrmguide.net/usa/layoff_tips.htm

McNamara, C. (2007). Growing your business. Authenticity Consulting, LLC. Retrieved 2/18/09 from http://www.managementhelp.org/grow_biz/grow_biz.htm

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Solution Summary

The solution looks at the issues that companies face when downsizing. The solution goes on to look at the challenges in growing companies and the change management processes that need to be implemented.

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Solution:
1)The patterns that you see emerging from the Layoff Tracker
The Forbes Layoff tracker shows the maximum shedding of jobs in the following companies, in the years* 2009 and 2010 :
Caterpillar (Capital goods ): 27,499
Pfizer(pharmaceuticals) :19,872
Verizon(telecommunication) : 21,308
Merck (pharmaceuticals) :16000
General Motors(automobiles) : 75,733
Citigroup(banking) : 52,175
AT&T(telecommunication) : 12,300
Walmart stores(retailing); 13,350
Alcoa(durables) : 13,985
There does not seem to be a well defined industry pattern to the top shedders, though there are two from the pharmaceutical industry and two from the telecommunication industry. Overall there are an assortment of industries showing layoffs with a larger number of companies from telecommunication, banking, health care, pharmaceuticals, software and transportation.
*The layoff tracker shows data till 3/31/2010. There is no statistics post this date and this is a limitation of the analysis.
A analysis of the financial performance of companies that shed the most jobs during 2009 and 2010, however indicates that investors were not really rewarded for massive layoffs these companies made(Hoium,2011).

2)The emerging issues in this area -- how will the problem be seen in the coming years
Temporary staffing is becoming common, with tightening margins, fierce competition and optimistic growth targets (Peck et al, 2005). The temporary staffing industry has become a globalized service industry and has liberalized the labor market.

Downsizing can undermine employee confidence in employment security (Kelly, 1996). As downsizing increases, the remaining employees may increasingly start demanding generous employee benefits because of a heightened sense of insecurity (Kelly, 1996).
Employees will make increasing use of outplacement services offered in companies as they need to look for alternate employment (Booth et al, 1995).
The use of technology will increase as companies downsize , resulting in jobless growth.

3) HR activities that should occur to effectively implement downsizing, and also to ...

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Ashvini Ravi, PhD
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  • MMS, Mumbai, India
  • PhD, Madras, India
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