A Study into the Process of Downsizing and Reengineering - Essay Example

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A Study into the Process of Downsizing and Reengineering

wnsizing and reengineering as well as practical applications need to stress total quality management (TQM), improvement of total level of strategic thinking, reengineering instead of downsizing whenever possible, process safety management (PSM), and other factors.
Managing expert Geoffrey James argues that downsizing is one of the five stupid management concepts that should be cut from the management corpus (2010). “How, exactly, did the company get into a situation where it needed to fire people in order to remain competitive?”, James asks. Yes, markets can be unpredictable and things can change at the drop of a hat, but this is what management is for. Downsizing is a sign of company failure: It is a sign that the company did not anticipate the changing marketplace and grew too much or spent too much. Downsizing is passing the buck: Management failed, but workers pay the bill. When downsizing is required, CEOs should be fired, not improved.
Reengineering needs to be conceptually separated from downsizing. Downsizing is almost by definition cutting down capital, particularly labor. It involves terminating peoples jobs, hurting resumes, economic dislocation and externalizing onto the system. But reengineering is a far more generic term. Reengineerings popularity has led to a backlash effect (Business Architects, 1999). It is often confused for downsizing, and thus has become negatively associated with the concept. Further, reengineering, unlike downsizing, can be conceptually “fuzzy” (Business Architects, 1999). Whats the bright line between reengineering and simply changing a companys strategic approach? If reengineering involves firing some people, isnt that downsizing? What if it merely involves some demotions, or some increases in responsibility without commensurate increases in pay? Nonetheless, reengineering is in fact very different from downsizing, and has unfortunately been falsely associated with downsizing when it is conceptually ...Show more

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Workers can lose trust in the company; so can consumers who may be turned off by perceived bad labor policies. Similarly, downsizing can cost institutional knowledge and hurt the institutional culture. People who…
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