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Personnel Review,

Vol. 27 No. 4, 1998, pp. 296-311.

# MCB University Press, 0048-3486

Received February 1997Revised July 1997Accepted October 1997

Downsizing: is it always leanand mean?

Nicholas Kinnie, Sue Hutchinson and John PurcellUniversity of Bath, Bath, UK

Caesar: ``Let me have men about me that are fat;Sleek headed men, and such who sleep o'nights.Yon Cassius has a lean and hungry look;He thinks too much. Such men are dangerous."( Julius Caesar, Act 1 Scene 2)

IntroductionDownsizing, and its associated euphemism, ``rightsizing'', became part of the

managerial lexicon in the late 1980s and early 1990s. Large scale redundancyprogrammes were seen to be the solution to the problems facing organisationssuch as AT&T, IBM, General Motors and British Telecom during this time.By the mid-1990s, however, doubts were emerging about whether downsizingwas the route to success that it was first thought. Evidence emerged thatmany downsizing initiatives had failed to achieve their objectives and theanticipated gains had not been realised. In 1996, Stephen Roach, the USeconomist, expressed severe doubts about the downsizing programmes whichhe had previously advocated. One of the reasons put forward for this failurewas the way downsizing was handled (Roach, 1996). As early as 1994,

Business Week reported, ``The sight of so many bodies on the corporate scrap

heap is sparking a corporate debate about profits and legality, and about thebenefits and unforeseen consequences of layoffs'' (Business Week, 1994, p. 61).In short, downsizing came to be associated with ``meanness".

Over the same period, there was considerable interest in the ` leanorganisation'', which was derived from the concept of lean production firstpopularised by Womack and his colleagues (1990) and more recently byWomack and Jones (1996). These writers claimed that by adopting techniquessuch as total quality management (TQM), just-in-time (JIT) and team workingit was possible to produce more goods and services with fewer resources of allkinds. Subsequent research has sought to extend the concept of leanproduction away from its Japanese auto industry base and consider the

transferability of the concept to other sectors and countries (Oliver andHunter, 1994; Oliver and Wilkinson, 1994; Shadur and Bamber, 1994; Shaduret al., 1995). However, other writers have developed a critique of theassumptions in the original work, especially its approach to change andtreatment of human resources issues (Bergerren, 1993).

Some authors have pointed out that these two trends have been linked andthat downsizing was perceived as one way of achieving leanness. ```Lean' cameto be associated with using less personnel, and hence downsizing came to beseen as a way to become `lean' regardless of the question whether or not


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originally Japanese ways of working were used in the new `lean' organisation''(Benders and van Bijsterveld, 1995, p. 9). Similarly, Millman argued (1996, p.9) ``Downsizing is invariably promoted under the guise of improvingproductivity and reducing organisational complexity, both being desirableattributes of the lean organisation."

Despite these claims, the relationship between downsizing and the leanorganisation is problematic. In the first part of the paper, therefore, we posethe questions: what is the relationship between downsizing and the concept ofthe lean organisation? Is downsizing always lean? In the second part, tworelated questions are pursued: what are the consequences for employees ofdownsizing? Is downsizing always mean?

The research reported here is the first stage of a larger project currentlyunderway in conjunction with the University of Warwick, and supported bythe Institute of Personnel and Development, into the people managementimplications of leaner ways of working. This first stage was based principallyon a study of the literature in the field together with some preliminary casestudies, which are not reported in this paper. A fuller description of the work,together with brief details of the cases, can be found in Hutchinson et al.(1996).

Is downsizing always lean?As ever with words such as downsizing it lacks a clear definition, beingcapable of conflating a number of very different circumstances whenorganisations reduce the number of employees. For example, the definitionput forward by Cascio (1993, p. 96) as a ``planned elimination of positions or

jobs'' tells us very little and provides an inadequate basis for answering thequestion posed. Furthermore, the literature in the field tends to concentrate onthe various ways in which these reductions in the workforce can be achieved:redundancies (or ``lay-offs"), voluntary turnover and early retirement.

Our concern is not so much how workforce reductions are achieved as thecontext and motives for such reductions: what are the forms of downsizingand why does downsizing take place? Four different forms can be identifiedtogether with their associated motives.

Forms of downsizingReductions in demand for products and services

The first form involves making employees redundant and not replacing themwith new jobs so that the numbers of employees decline. These workforcereductions are often motivated by a desire to reduce costs because of a declinein demand or increased competition in the marketplace. Cameron (1994) hascompared this form of downsizing to throwing a grenade into a room, closingthe door, and expecting the explosion to eliminate the desired percentage ofemployees. This form is often the result of a top down directive implementedover a short time period and is, according to Cameron (1994), typicallyassociated with a failure to achieve the set objectives.


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Within the UK movements in the trade cycle and changes in thecompetitive position of a firm have always led to fluctuations in bothworkforce numbers and hours worked. In this sense downsizing is really anew word for a long established employer practice. The word ``downsizing''used in this context does, however, imply two important conditions for thisactivity. First, the choice of redundancy, or collective dismissal as it is termedby the EC Directive, is taken in preference to other forms of cost reductionsuch as pay cuts (as in Hewlett Packard in the 1980s), hours reduction(Volkswagen in the early 1990s), labour hoarding as commonly practised inthe 1960s when unemployment was low, or short-term lay-offs as oftenoccurred in the motor industry 30 years ago. Second, downsizing presupposedthat the workers in question were employees of the organisation with open orpermanent contracts. Spot contract employees, agency staff and fixed-termcontract workers are not made redundant; their contracts just expire. Thus the

question is why in the 1980s and 1990s has such a fundamental breach of theemployment relationship been used in preference to other forms of labourinput reduction? Turnbull and Wass (1997) have argued that employers usethis option because of the lack of restraint provided by the State. Deregulationof the labour market has made it much easier (and cheaper) to use redundancy,while other forms of reduction, such as short-term lay-offs or shorter workingweeks, have been more difficult to implement since they require payreductions for all. There is also a strong ``me too'' element here becauseemployers see other organisations in the same industry making employeesredundant and perceive a need to be seen to be doing something in the eyes ofthe City. Indeed, in the US context Business Week (1994, p. 61) commented that``Critics believe massive downsizing has become ... a bone to throw to WallStreet when investors begin baying for cost cuts".

Structural changes resulting from changes in ownership or devolutionStructural changes to the organisation resulting in reductions in the numbersemployed take a number of forms. Senior managers may decide to simplify thestructure of the organisation by removing layers from the hierarchy or``delayering'' as it has come to be known. Peters (1989) recommended that anorganisation should have no more than five layers and examples of thesekinds of changes which have attracted publicity include BT, BP, Boots,

Storehouse, the Stock Exchange and Rolls-Royce. Research suggests that themain reason for delayering is to reduce costs (Ezzamel et al., 1993) althoughother reasons include reducing bureaucracy, speeding up communications andimproving responsiveness to customer demands.

A related change is where there is a move to decentralise the organisationoften with a related reduction in the numbers employed in head officefunctions. It is still surprisingly common to find head offices being reduced tobelow the 100 employee threshold to symbolise corporate leanness (Goold andCampbell, 1987). This may be linked to the establishment of strategic business


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units where, in theory, each of the businesses takes responsibility for its ownaffairs. The extent to which such decentralisation of discretion in the humanresources field is genuine, however, has been the subject of extensive research(Kinnie 1990; Marginson et al., 1993; Purcell and Ahlstrand, 1994).

Reductions in head office staff may also take place because of anacquisition of one organisation by another or a change of ownership, forexample the Lloyds/TSB merger in 1995/1996 which resulted in the closure ofTSB Head Office at Birmingham. Indeed, large scale redundancies of headoffice staff may be used as one of the arguments to support such mergers inthe first place, especially when functions are to be integrated, for example, inthe utilities where substantial savings are made by combining customerservice and billing units. Similarly, the privatisation of public sectororganisations may involve substantial redundancies as new ownersappraise the levels of employment required.

Core-periphery model greater flexibilityReductions in the numbers of permanently employed staff also take placewhen an organisation adopts the core-periphery model which was popularisedby Atkinson (1984). The associated practices involve distinguishing betweenactivities which are central or core to the business and those which areperipheral. Core staff will generally enjoy permanent or long-term contractsand good terms and conditions. Peripheral staff will comprise various othergroups including short-term contracts or casual employees and staff employedby labour agencies insourced to the firm (Purcell, 1996). More qualitativechanges are involved in some circumstances when the working practices of

core staff are modified, especially when new technology is introduced. In thesecases these staff will be obliged or encouraged to acquire competence in awider range of tasks and to become functionally flexible.

This model may be applied where market demand is difficult to predict orhighly seasonal and cannot be handled by normal methods such as increasedovertime working. Often a temporary expedient develops into a new labourforce strategy. Adopting this model can mean that employees in areas such ascatering, security, payroll, IT and even personnel are made redundant andtheir jobs are put out to tender by outside contractors. Permanently employedstaff are reduced, causing a reduction in the often all important ``head count''and their jobs are taken on by sub-contractors who do not appear on the

payroll figures.In this situation core employees are often required to develop multiple skills

following a more general redesign of jobs (Cameron, 1994). These staff may berewarded for their flexibility by the use of relatively sophisticated humanresource management techniques: they may be guaranteed job security, givenfinancial rewards for skill acquisition and access to training and developmentopportunities. In this instance, the uncertainty resulting from fluctuations inthe market is transferred from the core employees to the peripheral employeesand the sub-contracting organisations.


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For example, in one organisation in the financial services sector we visited

in 1997, of the 650 people working in the divisional office, 400 were permanent,

120 on fixed-term contracts and 130 employed by one of the labour supply

agencies. The firm, a household name, like other organisations renowned forthe sophistication of their human resources policies, used downsizing to shift

to a distinctive core-periphery employment pattern. Prior to the adoption of

the model in the 1990s, all employees had been treated as permanent or were

on open contracts.Although these forms of employment are often presented as if they are

novel in some way, they have a long history as discussed by Gospel (1993).

Constant or higher output with fewer employeesDownsizing also takes place where employers seek to maintain or improve

their level of output by improving their efficiency. Typically these changes

involve the adoption of new processes of managing including techniques such

as TQM, JIT or team working. TQM has been described as a ``hazy ambiguous

concept'' (Dean and Bowden, 1994, p. 394) but is seen to include three

fundamental principles: customer orientation, process orientation and

continuous improvement (Hill and Wilkinson, 1995). The main aim of JIT is

to match output of manufacturing systems to the needs of the market (Oliver,

1991). Both TQM and JIT can lead to reductions in the numbers employed

because of the re-organisation of the tasks involved. TQM can lead to

reductions in those employed in quality departments and to delayering with

the use of teamworking and empowerment policies, while JIT can, in theory,

increase employees' task flexibility and autonomy. Often the move to JIT and

TQM is accompanied by the introduction of new technology which itself may

involve job losses and new working practices (Wilkinson et al., 1996).Changes of this kind are often part of much broader developments in the

organisation which Cameron (1994, p. 198) defines as ``systemic". Here the aim

is to ``focus on changing the organisation's culture and the attitudes and

values of employees, not just changing the size of the workforce or the work".

In these circumstances downsizing is seen as ``a way of life, as an ongoing

process, as a basis for continuous improvement rather than as a program or a

target. A continuous improvement ethic is applied to the task of downsizing,

and cost savings throughout the entire system of interorganisational

relationships are pursued'' (Cameron, 1994, p. 199). Although only one-third

of organisations in Cameron's study adopted this approach to downsizing they

were the organisations which were most likely to achieve their objectives.We argue that of the four different types of downsizing only the last two of

these can actually be associated with lean production. In order to explain why,

despite this, downsizing has become associated with lean production we need

to go back to the original work by Womack and his colleagues (1990).


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people; therefore if I have fewer people my firm will be more efficient". In fact,the concept soon began to take on the form of a managerial fad (Benders andvan Bijsterveld, 1995) where a favoured management concept or technique istalked about as:

. promising considerable improvements;

. being an absolute necessity for the modern organisation;

. is universally applicable;

. and, therefore, becomes abstract, vague and ambiguous.

This interest in leanness coincided with broader changes in the business andeconomic cycle. Many national economies experienced a downturn in activity,increased competition and excess capacity in the early 1990s. Majororganisations made very large financial losses and were looking for ways tosave money. Downsizing seemed to be right for the time and have anirresistible logic of its own, even though there was considerable evidence thatthese changes were often not the ``right thing to do'', as we discuss in greaterdetail below.

The spread of the message was also helped by the appeal of themetaphorical rather than the adjectival use of the term lean. We associate leanwith an absence of fat, and with being healthy and fit. This is often comparedto being overweight, unfit and with damaging excess or spare capacity. Leanbecame equated with good and successful, and fat, the opposite of lean usingthis metaphor, became associated with bad and unsuccessful and, therefore,something which needed to be removed by a ``diet'' of some kind.

It was because of this association between lean and downsizing that leanbecame associated with mean, and this simple association has persisted formany people. Indeed, this may explain why some organisations in the mid-1990s are reluctant to be described as lean: the term has taken on a ratherdifferent interpretation for the manager with one eye on the public perceptionof the organisation. We are finding that what was once a macho term is nowsending out the wrong signals, especially to employees.

However, if we examine the contemporary use of the lean concept (Womackand Jones, 1996) we can see that emphasis remains on the elimination of waste.This may mean employing fewer people, but this is not inevitably the case.Lean thinking is associated with five key principles as the authors explain:

(1) specify value as defined by the ultimate consumer;

(2) identify the value stream;

(3) make the value creating steps flow;

(4) let customers pull value from the organisation;

(5) seek perfection.

Lean thinking may be associated with employing fewer people if theorganisation is in a poor financial state, when some employees will have to


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``man the lifeboats'' (Womack and Jones, 1996, p. 258). However, if theorganisation is profitable, Womack and Jones assert, then the changes willtypically involve redeploying people into a lean promotion function (1996, p.256) rather than making them redundant. The exceptions to this are ``anchor

dragging managers'' who will not accept the new way of thinking when therewill be a need to ``take action quickly'' (Womack and Jones, 1996, p. 260). Theydo not, however, provide evidence to substantiate these assertions.

To sum up the argument so far we can see that downsizing takes at leastfour different forms, two of which involve changes only in the numbersemployed. This does not, of course, prevent managers from seeking tolegitimate such changes by reference to the need for greater leanness even ifthe outcome of the changes is quite different from the original lean concept(Benders and van Bijsterveld, 1995, p. 9).

Only two forms of downsizing could be said to involve the adoption of leantechniques, which include qualitative changes in the process of managing.Consequently, organisations which have downsized are not necessarily lean,indeed, the take-up of lean techniques as a result of downsizing may be verylimited. Leanness, as it was originally defined, rather than how it has beenused, is about changes in managerial processes rather than simply a reductionin employment.

Having concluded the first part of this paper by arguing that downsizing isnot always lean we can now proceed to the second question concerning howmoves to leanness are actually handled.

Is downsizing always mean?

Although it is commonly believed that downsizing should result in moreefficient, competitive companies there is increasing evidence in the literature,however, to suggest that the majority of downsizings are unsuccessful. Theexpected economic and organisational benefits failed to materialise. In theUSA between two-thirds to three-quarters of all downsizings are unsuccessfulfrom the start (Howard, 1996). Another American study by the WyattCompany (1994) found that few downsizings meet their desired goals in termsof increased competitiveness and profitability. The majority of organisationsmeet their immediate cost reducing objectives but this improvement is notsustained in other areas such as long-term goals of improved service andincreased competitive advantage. In the study of the financial performance of

Fortune 100 companies over a five-year period (two years prior to theannounced downsizing, the year of the announcement and two years followingit) De Meuse et al. (1994) found that the financial performance worsened,rather than improved following the reductions in the workforce.

Downsizing does not appear to offer the ``quick fix'' to a company'sfinancial problems. Advocates of downsizing will argue that if it were not forthese downsizings the company might be bankrupt. De Meuse et al. (1994)admitted this point might have some merit but their findings show thatcompanies who downsize continue to suffer financial problems and announce


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lay-offs, or as Cascio (1993, p. 102) noted ``downsizing begets moredownsizing". De Meuse et al. (1994, p. 521) concluded that ``if massivelayoffs are being used as the medicine for survival, their efficacy isquestionable". We can now consider some of the possible reasons for this

poor performance: in particular is it because of the way in which thesechanges have been handled? Is it because downsizing is always mean?

Reasons for the failure of downsizingThere are a variety of reasons put forward for why downsizings fail to returnthe expected benefits. Evans et al. (1996) suggested two major reasons forfailure, the main one being that downsizing is usually not undertaken as partof a broader strategic repositioning of the firm. The second reason is that,despite their best intentions, some companies risk cutting ``muscle instead offat'', and can loose key competencies. A number of commentators havesuggested that downsizing is often undertaken for the wrong reasons.Vollman and Brazas (1993, p. 21) suggested that downsizing may not be anappropriate response, at least in isolation, to competitive problems resultingfrom ``poor quality, lack of flexibility, misguided or obsolescent strategies,technological backwardness, slowness in rolling out new products, over-diversification and/or a failure to capture synergies, inability to grasp and orcounter competitors strategies, ineffective marketing etc."

Some commentators have argued that in times of uncertainty firms copythe actions of others in order to feel secure. Research by Cameron and hiscolleagues (1991) showed that the failure to share the pain is one of the majorreasons that downsizings fail. Top management do not take a cut in their

benefits together with those lower down the organisation. Cascio (1993)mentioned the effect that changes in staffing can have on the human resourcesactivity in particular. Redundant employees may be replaced by consultants,there may be a duplication of functions in strategic business units and linemanagers will require training if they are to carry out human resources tasks,which companies may find expensive. The end result is that some redundantemployees may be taken back as consultants. Moreover, there is growingevidence to show that ignoring the impact on survivor employees is one of themain reasons for long term problems (Greenhalgh, 1982; Roskies and Guering,1990). In a recent article on the decline and rise of IBM, Quinn Mills (1996)claimed that its failure in the 1980s and early 1990s was partly the result of

breaking an implied promise to provide job security in order to bail out itsshareholders. As a result employees became disillusioned and less effective.

Very often organisations that downsize prepare well for those employeeswho are leaving, by, for example, providing outplacement facilities, careercounselling, networking opportunities and early release schemes, but ignorethose left behind. For example, a survey by Doherty and Horsted (1995) offinancial service organisations showed that the majority (62 per cent)indicated that no evaluation of the impact of redundancies on retainedemployees had been carried out.


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In fact numerous studies show that following downsizing survivingemployees become narrow-minded, self absorbed and risk averse (Cascio,1993). Employees become less flexible and over dependent on traditional, wellknown ways of doing things, and creativity is inhibited. Symptoms, whichhave come to be known as the ``survivor syndrome'', include a fall in morale,drop in productivity and distrust of management (Brockner, 1988; Brockner etal., 1987, 1994). Stress increases, absenteeism rises, quality slips, employeeswork shorter hours and initiate job searches. Survivors may feel guilty that itwas not them who went, fear a loss of job, be unclear about responsibilitiesand what managers expect of them, perceive their workload to be higher, andfeel the ``psychological contract'' is threatened. There may also be feelings of``survivor envy'' (Vollman and Brazal, 1993) ("he's got a special retirementpackage and new job that pays better etc.") which may reduce employeecommitment.

Most of the literature is based on US evidence but the problems areuniversal. In a UK survey of 170 personnel specialists in 131 financial servicescompanies, Doherty and Horsted (1995) concluded that organisations forced tocut jobs are neglecting the needs of the employers who remain. Although 79per cent of firms provided outplacement services for employees leaving, thesurvey found that less than half gave support to those who remained. Insteadof feeling relieved that their jobs were secure, those who survived weredemoralised about their own future. There were also feelings of increasedstress, scepticism, anger and bitterness. Although most respondents (93 percent) said there were formal strategies for retaining and motivating remainingstaff, the majority tended to focus on rewards and training (mainly in jobskills for new work roles). Fewer than half (42 per cent) reported the use ofsuccession planning or career management (44 per cent). Further evidence ofsymptoms of the ``survivor syndrome'' were evident in a survey of BTmanagers (Newell and Dopson, 1996) which found that following the lengthyredundancy and rationalisation programmes managers were demotivated, feltthey were working longer hours, lacked information about their role and hadreduced control.

There is some evidence, however, to suggest that feelings of guilt or fear offurther job cuts can increase performance and productivity (Brockner, 1988;Brockner et al., 1987; Doherty and Horsted, 1995). Others, for example, Cooper

(1994), claim that fear about future redundancies can lead to inappropriatebehaviour in survivors who work long hours simply to be seen at work suchpeople being called ``presentees".

Implementing downsizingThe research discussed above points clearly to a failure by employers to dealadequately with employee issues (both those who leave and especially thosewho remain) when downsizing takes place. Often there is a very limited ornon-existent human resources role in these changes. This evidence provides


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support for those who argue that downsizing is often handled in a mannerwhich can only be described as mean. These methods of implementation areseen as major contributors to the failure of downsizing.

Certainly, there is no shortage of advice to practitioners in the literature asto how downsizing ought to be handled. These advice lists usually take theform of ``motherhood statements'' which appear to provide practical help, buthave little meaning in practice. For example, Cameron et al. (1991) tell us thatsuccessful downsizing strategies require implementation from the top, but alsowith recommendations from lower-level employees and urge the employer topay special attention to those employees who loose their jobs as well as thosewho don't. If downsizing is this straightforward, we are entitled to ask, whydo more firms not introduce changes in this way and make a success of thewhole process.

Evans et al. (1996, p. 5) suggested that it is not enough to manage the

downsizing event effectively and humanely and make sure the changes areintegrated with the business strategy. It is also vital to consider the careerconsequences of downsizing. They ask:

why would anyone want to stay to work for you in the longer term? You can be sure of one

thing. By the time you discover that, the executives on whom you depend are asking the

same question about themselves (and) it will be too late.

The need to take a new look at the development of careers is well covered inthe literature on delayering. Some research (Brockner, 1988; Guest and Peccei,1992) suggested that symptoms of survivor syndrome are alleviated whensurvivors perceive the situation to be handled fairly for both those leaving and

those remaining. Doherty and Horsted (1995) suggested that employeesurvivors need professional advice, training and counselling and support ifthey are to manage change successfully and counteract the effect of the

survivor syndrome. Part of the answer lies in employability, that is theopportunity to take on board personal career ownership. This allowsindividuals to be better equipped to cope in terms of emotions and skills.For the organisation it offers the chance to achieve more flexible and painlesschange and the opportunity to generate more appropriate behaviours. Iforganisations, however, are to move to employability rather than employmentthey must find alternative ways to develop skills and retain and motivate

employees.Thornhill et al. (1997) have developed a diagnostic tool for analysingsurvivors' responses to downsizing. They identified five areas of interventionto address issues of survivors' commitment to the organisation: perceptions offairness and justice; line managers' skills to support changes; open andrealistic communications; senior management commitment and attempts toclarify uncertainties.

Doherty and Horsted (1995), however, suggested that most organisationsare quite narrow in the HR interventions they use to manage survivor


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syndrome. Beyond reward and skill-related training few other approaches aregenerally applied. Doherty and Horsted (1995, p. 31) suggested that managingchange successfully means addressing issues from the organisational andindividual perspective:

This requires the development of HR strategies which dovetail the use of internal andexternal interventions, to give equal support and assistance to individual's personaltransition by offering them opportunities to develop themselves for the benefit of theorganisation, whatever that may be in the future.

Behind this is the wider question of managing employees' expectations andcreating realistic expectations of job security, career and job content. Thefailure to address these issues, either though silence, a failure to recognise theimportance of expectations, or optimistic blandishments that despite all thechanges there will be no changes to job security and careers leads to frustratedexpectations and most important a breach of trust. Expectations are at the

heart of job satisfaction, the psychological contract and the illusive concept ofcommitment. Downsizing organisations by definition are changing theparameters of the psychological contract but many fail to recognise it. Therequirement to manage expectations is especially pertinent when downsizingis associated with stepped change that is likely to be persistent. This is clearlythe case in the adoption of the core-periphery model, it is also true post-acquisition, integration or privatisation (Hubbard, 1996). Where downsizing islinked to the adoption of the lean organisation the process changes required ofcustomer orientation, continuous improvement and learning better ways ofworking are so marked that the failure to address expectations is likely totrigger the negative effects of downsizing analysed earlier rather than lead to

the required state of high commitment, high trust and empowerment.More generally, the evidence on what constitutes good HR practice for a

successful downsizing is not particularly strong. Kettley (1995) suggested thatthere are discernible trends in the way employers can adjust HR policy andpractice during and after a downsizing. These include:

. Winning commitment to the change via considerable effort in employeecommunications. For example, the workforce should be well informedabout the need for cuts, the redundancy criteria, any changes in theirresponsibility plus long-term plans for the company.

. Ensuring adequate provision of support for the well being of retained

as well as outplaced staff including career counselling and stressmanagement interventions such as employee assistance programmes.

. Enhancing opportunities for training and development of new skills, toachieve new ways of working for individuals and groups.

. Realigning the performance management system.

Cameron (1994), drawing on a four-year study of downsizing, found thatcertain forms of downsizing were more likely to succeed than others. Hesubsequently identified to managers the best practice of successful


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downsizings and argued that the most critical factor for success was theeffective management of the human resource system. ``Employee involvement,teamwork, communication and information sharing, rewarding, appraising,training, articulating with vision and administering downsizing in a

trustworthy and fair manner are all critical aspects of successfuldownsizing'' (Cameron, 1994, p. 210). He concluded that ``Human resourceprofessionals have a central role, therefore, in ensuring the successfulimplementation of downsizing strategies'' (Cameron, 1994, p. 211).

Forms of downsizing and the human resources roleThe proposals discussed above provide a possible means of avoiding some ofthe adverse effects on employees and thereby improving the success rate ofdownsizing. However, they fail to acknowledge that downsizing takes anumber of different forms, with varied associated motives, and that the humanresources implications of each of these forms are likely to be different.Although downsizing involves a change in the absolute or relative number ofemployees, these reductions take place, as we have seen, in very differentcircumstances and for different reasons.

Reducing output involves a reduction in employment of some kind withassociated human resources considerations such as outplacement activitiesand procedures for managing those employees who have survived thedownsizing and remain within the organisation. Merging two organisations ora change of ownership will involve decisions about the shape of the neworganisation and which employees from the original organisations will beretained and which are made redundant. The core-periphery model involves a

fundamental re-appraisal of the activities of the business, renegotiation ofcontracts of employment and of service and careful handling of the tenderingprocess. Finally, seeking to produce the same output with fewer people islikely to involve reductions in employment, the introduction of new forms ofworking such as JIT, TQM and the formation of teams and the associatedchanges in training programmes, appraisal and pay systems.

ConclusionIn conclusion, we summarise our findings and address two outstandingquestions. We have argued that downsizing takes at least four forms, each ofwhich is associated with a particular context and set of motives: reductions in

employment because of reduced demand; restructuring and reorganisation;adoption of the core-periphery model and higher output with fewer employees.Only the last two of these can be characterised as adopting the lean principles.Indeed, rather than becoming lean, downsized organisations will often becomeanorexic or skinny, when what they really want to do is become fit for theirpurpose and responsive to their markets.

Downsizing often fails to achieve the objectives which are set for it for avariety of reasons. One of the most important of these is the inadequateattention paid to employees and the associated human resource management


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practices. Although there is some evidence of attention to employees who

leave the organisation it is rare for employers to consider the interests of thosewho remain in employment, which led us to see downsizing as mean.

Organisations seldom gain the benefits of increased efficiency associated with

lean production, but reap all the drawbacks of meanness.Given these findings, it is interesting to consider why downsizing has

become associated with leanness and meanness. There are various possible

explanations for the association between downsizing and leanness:

practitioners seek a rationale for changes which are made for quite differentreasons, consultants package together a whole series of techniques into a

``change programme'' and writers rely on management accounts of changes

made and fail to take sufficient account of the forms of and motives for

downsizing. The link between downsizing and meanness is less problematicsince both the research and the practical experience of either redundancy or

surviving a redundancy shows that employers often pay little attention toemployee concerns. Summing up, the review suggests that downsizing israrely lean, but often mean and hence frequently associated with failure.

Despite this evidence, the link between lean and mean and downsizing seems

to be firmly established in the eyes of employers, with the corresponding

public relations connotations.But is it inevitable that downsizing is rarely lean but often mean? We have

seen in our empirical research some examples of companies that have adopted

lean working practices and also managed to deal with the employee issues. Itis in this area that we believe the potential for further research lies where

changes in business processes are made with full consideration for the humanresource implications. Indeed, we suspect that only by using these methods

can leaner ways of working be sustained.

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