Effects of Downsizing

Introduction
Downsizing, Layoffs, Cutting the Flab or more rudely put "removing of dead log" are the buzzwords being constantly used in today's business scenario. A national survey done by New York Times states: since 1980, a family member in one-third of all U.S. households has been laid off (New York Times, 1996). But what exactly we mean by "Downsizing". There has been very little research done on this subject (Cameron, 1994, p-183).
Cameron, defines downsizing as a positive and purposive strategy: "a set of organizational activities undertaken on the part of management of an organization and designed to improve organizational efficiency, productivity, and/or competitiveness" (Cameron, 1994:194). Mostly companies used this strategy for cost reductions. Wayyat company survey done between 1985 to 1990, showed that 89% of the total companies which down sized put reduction in costs as their main objective.
…