Page 242 - Fundamentals of Management Myths Debunked (2017)_Flat

CHAPTER 7 • Managing Human Resources 241
What Contemporary HRM Issues Face Managers?

HR issues that face today’s managers include downsizing,
7-5 Discuss workforce diversity, sexual harassment, and HR costs. downsizing
The planned elimination of jobs in an organization
contemporary layoff-survivor sickness
issues in How can Managers Manage A set of attitudes, perceptions, and behaviors
managing human Downsizing? of employees who survive layoffs
resources.
Downsizing is the planned elimination of jobs in an orga-
nization. Because downsizing typically involves shrinking
the organization’s workforce, it’s an important issue in
HRM. When an organization has too many employees—which may happen when it’s faced
with an economic crisis, declining market share, overly aggressive growth, or when it’s been
poorly managed—one option for improving profits is to eliminate excess workers. Over the last
few years, many well-known companies have gone through several rounds of downsizing—
AmEx, Boeing, McDonald’s, Volkswagen, Microsoft, Dell, General Motors, Unisys, Siemens,
Merck, and Toyota, among others. How can managers best manage a downsized workforce?
After downsizing, disruptions in the workplace and in employees’ personal lives are to be
expected. Stress, frustration, anxiety, and anger are typical reactions. And it may surprise you
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to learn that both victims and survivors experience those feelings. Many organizations have
helped layoff victims by offering a variety of job-help services, psychological counseling, sup-
port groups, severance pay, extended health insurance benefits, and detailed communications.
Although some individuals react negatively to being laid off (the worst cases involve individuals
returning to their former organization and committing a violent act), offers of assistance reveal
that an organization does care about its former employees. While those being laid off get to start
over with a clean slate and a clear conscience, survivors don’t. Unfortunately, the “survivors”
who retain their jobs and have the task of keeping the organization going or even of revitalizing
it seldom receive attention. One negative consequence appears to be what is being called layoff-
survivor sickness, a set of attitudes, perceptions, and behaviors of employees who survive
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involuntary staff reductions. Symptoms include job insecurity, perceptions of unfairness,
guilt, depression, stress from increased workload, fear of change, loss of loyalty and commit-
ment, reduced effort, and an unwillingness to do anything beyond the required minimum.
To show concern for job survivors, managers may want to provide opportunities for
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employees to talk to counselors about their guilt, anger, and anxiety. Group discussions can
be a way for the survivors to vent their feelings. Some organizations have used downsizing
as the spark to implement increased employee participation programs such as empowerment
and self-managed work teams. In short, to keep morale and productivity high, managers
should make every attempt to ensure that those individuals still working in the organization
know that they’re valuable and much-needed resources. Exhibit 7–10 summarizes some ways
that managers can reduce the trauma associated with downsizing. 45

Exhibit 7–10 Tips for Managing Downsizing

• Communicate openly and honestly:
• Inform those being let go as soon as possible
• Tell surviving employees the new goals and expectations
• Explain impact of layoffs
• Follow any laws regulating severance pay or benefits
• Provide support/counseling for surviving employees
• Reassign roles according to individuals’ talents and backgrounds
• Focus on boosting morale:
• Offer individualized reassurance
• Continue to communicate, especially one-on-one
• Remain involved and available