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Downsizing Of Gm Essay

4996 words - 20 pages

|Counting Our Blessings |
|Organizational Re-Structure of General Motors |
|Behavior in Organizations |

Outline
I. Introduction
II. Definition
a. Downsizing
b. Restructuring
III. Primary Issues (Part One)
a. How to Downsize Effectively
IV. Company Background
V. Primary Issues (Part Two)
a. General Motors: Restructuring
VI. Conclusion
VII. References

Introduction
Over the ...view middle of the document...

Definition
Downsizing
In order to comprehend the changes that have transpired with the General Motors Company, we must first define our changes. Downsizing can be defined as “an organization’s conscious use of permanent personnel reductions in an attempt to improve the efficiency and/or effectiveness” of the company (Budros, 1999). Most often, downsizing results in using layoffs as a strategy to eliminate personnel permanently. Downsizing has become a leading strategy for companies around the world. The prime reason of most downsizing efforts is the desire for immediate reduction in cost as well as increasing levels of efficiency, productivity, profitability, and competitiveness (Gandolfi, 2008). Downsizing changes the dynamics of employees, leadership teams, and the entire organization. Research has shown that most people see the consequences of downsizing as negative (Budros, 1999). According to Budros (1999), the negative impact on downsizing results in low morale and motivation, not to mention a decrease in labor and productivity.
Theories and strategies aside, it is clear that downsizing has changed the nature of the relationships between employees and leadership throughout the entire organization. The potential of a reduction in numbers hangs in the minds of employees when it is unclear and done in a manner lacking communication. This in turn greatly impacts employees on a daily basis, leaving them with feelings of uncertainty as to who will be next. As a result, it becomes difficult to maintain an effective and profitable environment (White, 2009).
Restructuring
Over time, the meaning of downsizing has become clouded because nearly everyone treats downsizing and restructuring as overlapping or portrays downsizing as a general concept that encompasses restructuring. By definition, restructuring is changes in an organization’s formal structure, which may includes cutting hierarchical levels and or divisions, consolidating units, and reorganizing work tasks (Budros, 1999). Downsizing and restructuring are independent of one another but are often correlated to one another when it comes to companies strategizing at improving efficiency.
Since the practice of restructuring has become widespread in present-day organizations, the basic management principles need to be altered to create a smooth transition for employees. Human resource programs should be aligned in promoting hard work, and basically employee-centered, since these individuals are the company’s key strength. Team work also plays a vital role in the organizational management. Oftentimes, problems in the industry are caused by a lack of collaboration (Peak, 1997). For employees of companies involved in such events, this is traumatic. Using behaviors in each type of change, management members may not only survive but thrive in the innovated organization. By knowing how to recognize the signals and opportunities that accompany these events, you can emerge from a period of...

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