There are many situations when companies have to implement certain changes in their working process. The reasons for introducing the changes can be different and may include the development of modern technologies, modification of consumers’ needs, or adaptation to market demands. In addition, the transformations may be caused by crises, new opportunities, and gaps in the performance of employees (Jalagat, 2016). As for the company that is going to be discussed in the framework of this presentation, the change there occurred as a result of the merger. The organization merged with a much larger Boston Accounting Firm. As a result, there is a need to downsize one of the departments of the organization in terms of employees. In this case, the transformation is needed to improve efficiency, increase revenues, and reduce costs of the company.
The Impact of Changes
There are several changes that are brought by downsizing. Thus, the company may decide to downsize the staff in order to increase productiveness. Man’s labor force is substituted by automatic equipment that reduces the expenses of the organization and strengthens its productivity. Moreover, downsizing eliminates the conflicts that may occur between people, especially if they are representatives of different cultures and beliefs. However, it is necessary to note that the downsizing is usually performed by experts of various fields of expertise as it helps to determine who should be dismissed and what specialists should stay in the company. In the case of Boston Accounting Firm, the layoffs will be performed by individuals from various departments, namely, Auditing, Tax, Corporate Governance, and Legal and Insurance.
Who Will Be Affected and How They Will Be Affected
First of all, the downsizing in any organization affects its employees, as they are the first individuals who face the challenges of layoffs. It is ensured by the fact that the majority of workers experience anxiety and concerns, as there is a threat to be fired. Moreover, sometimes, downsizing implies that workers have to change working places, and their duties may be expanded or changed. It results in stress, which does not affect working performance positively. Also, people may experience some conflicts at their new working places due to the clash of corporate cultures in case if downsizing occurs as a result of a merger. In addition, some business owners may also be affected as there is always a risk that employees will not be able to stick to new regulations and orders.
Management of Potential Conflicts
The most significant risk of mergers and downsizing is the high possibility of conflicts between employees of different organizations. To manage the contradictions, it is necessary to take certain actions by supervisors. These actions include understanding the nature of the conflict, listening to both sides, and encouraging employees to resolve the issue themselves. If they fail to resolve the issues on their own, it is necessary to determine the real problem and find a solution together. Later, there is a need to organize training for employees to teach them how to communicate effectively and work in a team.
Strengthening the Trust
It is also beneficial to build and strengthen trust between the staff members to achieve success, especially during the downsizing. Thus, trust can be strengthened through the hard work of both managers and subordinates. It implies sticking to a specific approach, based on honesty, support of employees, consistency, and accountability. However, there are some situations that lead to undermining of trust. Managers should be ready to respond to these incidents properly by implementing some rules and encouraging those who follow them. Thus, the plan for rebuilding trust should include increasing communication, avoidance of gossips, and encouragement of respectful relationships between colleagues. It may also contain reliability, keeping promises, and forgiveness of others for mistakes made at work.
Distribution of Power
Distribution of power after the restructuring of an organization should be performed in accordance with the credentials, skills, working experience, and abilities of the employees. As for the heads of the Boston Accounting Firm, the authority among them will be allocated according to the number of financial means that they contributed to the organization’s development. Moreover, the number of shares that are possessed by business owners will also be a defining factor in the distribution of power in the company. It is also worth to take into account that restructuring of the organization may result in changing its goals and vision. Then, the distribution of power will be performed by taking into account the backgrounds of employees and how their knowledge can contribute to the achievement of new goals.
Tactics for Successful Restructuring
For a smooth downsizing, it is necessary to stick to certain strategies. First of all, it is better to warn employees about any future changes in advance. It is especially crucial for those who are going to be fired as a result of the layoffs. These employees should be informed about their rights for compensations and other social privileges that might be used to ease the process of dismissal.
Those individuals, who are going to continue the work at the organization, should be provided with teaching tools to enhance skills and adjust their knowledge for the successful performance of new tasks. Also, it is needed to lead an open policy for the organization and answer all the questions of employees about the reasons for the made decisions to eliminate conflicts.
Tactics that Should be Avoided
The worst two tactics that can be used in the case of restructuring are hiding the facts about the future transformations from employees and the establishment of competitions for future employment. As it was mentioned above, workers should have enough time to find new working positions in case if they are going to be dismissed. Moreover, people need some time to get used to new circumstances and be ready for any modifications. Hiding the information and unexpected changes may result only in irritation, conflicts, and the creation of unnecessary emotional tension between employees.
Sometimes, during the downsizing, some employers prefer to organize competitions between workers for future working positions. They also may hire a few people for one position to see how they perform during the probation period. This tactic is highly undesirable and will not be used in Boston Accounting Firm as it causes stress and an unhealthy psychological environment.
Benefits of Changes
There are several benefits that can be brought by downsizing. As it was mentioned above, it results in an increase in productivity. Also, the development of productivity leads to an increase in profits. In addition, the reduction in the number of people results in a decrease in the number of conflicts between employees of the organization.
The timeframe for implementation of changes can be different depending on a number of factors, such as the size of the organization and the industry where it works. The performance of the organization and its position in the market also play a significant role. In Boston Accounting Firm, the main challenges that may occur due to the downsizing are planned to be overcome in a period of six months.
Communication of Changes to the Employees
Any changes that may occur in an organization should be communicated with employees in accordance with the policy of openness. It is necessary to have a respectful attitude to any employee of the organization, including those who are going to be dismissed as a result of downsizing. Also, it is significant to be able to respond to all the inquiries and questions of employees about future changes and conduct presentations to provide detailed information to individuals. In the Boston Accounting Firm, downsizing will be performed in a smooth and non-traumatic way as every dismissed employee will receive compensation and a recommendation letter for future employment. Moreover, the explanations of the reasons why some individuals were dismissed and others invited to continue their work will be provided.
Jalagat, R. (2016). The impact of change and change management in achieving corporate goals and objectives: Organizational perspective. International Journal of Science and Research, 5(11), 1233–1239.