The Equity Issue LO5858

Dr. Ivan Blanco (BLANCO@BU4090.BARRY.EDU)
Mon, 26 Feb 1996 17:18:21 -0500 (EST)

Replying to LO5693 --

> Date: Sat, 17 Feb 1996 08:38:10 -0400
> From: (Scott R. Cypher)
> >What I have
> > found is that there are three primary reasons for downsizing:
> > 1. Reduction in production rates - resulting in fewer people needed
> > to deliver fewer products
> > 2. Process improvements - sometimes referred to as re-engineering.
> > This results in people working themselves out of a job.
> > 3. Cost cutting - resulting in dollar goals being set without
> > reference to work statements

What is downsizing? What was it developed for? The way it is
applied, it has more to do with the classical cost-cutting layoffs! If it
was done with extensive consideration for individuals and the
organizations, I think that there would not be as many people losing their
jobs as we have right now. In fact, because there so many massive layoffs
in downsizing, is why I think it is not done in a careful and well thought
out way as has been indicated here.

> These do not sound like reasons, more like the problems. Its not clear to
> me that downsizing is the right solution to these problems. I need more
> data and information. I have to ask the question, especially for #1 and
> #3, is Why?
> Why have production rates fallen? Why have cost cutting goals been set?
> One complaint I hear most often in downsizing events is that people at the
> bottom are being cut, where the reasons given (e.g. #1 & #3) aren't ones
> that they directly control.
> Upper levels are purported to monitor and manage sales, operating
> efficiencies, etc. So if the upper levels are not "doing their job" (as
> seen by the lower levels) why are the lower levels "paying the price" for
> non-performance (donwsizing)?

I think that teh evidence that they are not doing their job is
precisely that the have to send so many people home in short nnotice to
improve a balance for the current fiscal year. If they were doing the
job, which includes both short-term actions and long-term vision, they
will probably be able to anticipate the "death" of a product, for
instance, to come up with new ones that will keep people and equipment

> I'd like to see us ask "Why" as many times as necessary to get the above
> three down to an essence, and then see if downsizing is the right answer
> to that essential problem. Often I've seen downsizing advocated as the
> solution, when I'm not clear that it will solve the root problem....

It is a lot easier to reduce the payroll in significant numbers
than to apply creativity and innovation, to learn together to improve, not
only the processes, but to develop new "things" that could prevent people
from re-ingeering themselves out of their jobs. This represents learning
opportunities lost. I imagine that those who stay behind would not be too
willing to learn how to improve the system and processes anymore!

For as long as managers all over the world continue to be driven
by short-term pressures (as the Wall Street influence in the U.S.), then
organizational learning, TQM/CQI, systems thinking, etc. will have less of
a chance of being really implemented for extended periods of time!


  R. IVAN BLANCO, Ph.D.                        Voice 305 899-3515
  Assoc. Prof. & Director                      Fax   305 892-6412
  International Business Programs
  Andreas School of Business    _________E-Mail Addresses________
  Barry University              Bitnet: Blanco%bu4090@Barryu
  Miami Shores, FL 33161-6695   Internet:
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