A model to explore the mystery between organizations' downsizing strategies and firm performance: Integrating the perspectives of organizational change, strategy and strategic human resource management

Abstract

Purpose

Downsizing in organizations is a popular management strategy. However, in the field of organization change, the question of whether downsizing practices eventually improve performance is frequently asked and is never satisfactorily answered. The consequences have not always materialized over these years. On the negative side, downsizing harms employees, their families, and at the same time causes social chaos. The possible answers could be the ignorance of some important mechanisms between them. The paper aims to explain this issue.

Design/methodology/approach

The paper applies the dynamic strategy capabilities concept from the strategy research field and strategic human resource management (SHRM) practices concept from the SHRM research field.

Findings

A consolidated model is established to explain the relationships among these variables.

Originality/value

The model is expected to provide significant implications for thought leaders to reflect on the topics regarding organizations' changes, firm's strategies and SHRM system and social issues.

Citation

Tsai, C. and Yen, Y. (2008), "A model to explore the mystery between organizations' downsizing strategies and firm performance: Integrating the perspectives of organizational change, strategy and strategic human resource management", Journal of Organizational Change Management, Vol. 21 No. 3, pp. 367-384. https://doi.org/10.1108/09534810810874831