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Home » Business And Finance Articles » Calculating The Human Costs Of Downsizing

Calculating the Human Costs of Downsizing

Downsizing is never an easy decision. There is an inherent conflict between protecting the company's interests and that of employees. This balancing act can be a real dilemma for an organization as it tries to insure its long-term survival, and its desire to protect the welfare of its employees.

Handled improperly, a company downsizing can damage the public standing of both the organization and its management. People have long memories, and after a difficult time an organization needs the support of the remaining employees in order to rebuild.

Consider the costs once remaining employees begin to question their company's published ethical standards and values. At best, they will do their job responsibly, not putting much effort to the re-growth of the organization as they just go through the motions of their job. At worst, absenteeism increases, morale decreases, and resentment steadily begins to grow, all of which inevitably disrupts the functions of the organization. The cost is immeasurable.

Minimizing human costs

To lessen the negative impact of a downsizing, the remaining employees must be assured that the decision to reduce the workforce was made only as a last resort, after lengthy discussions and a concerted effort to reduce costs in other areas.

Employees will closely monitor the way downsized employees are treated. They want to be assured that their former colleagues and friends that were let go are being cared for. To avoid the guilt that most remaining employees feel, management should stress that departing employees are being provided with the best severance package that current circumstances allow for.

After a layoff, the remaining employees will experience an array of emotions including confusion, anger and fear. If these emotions are not addressed, valued employees may feel their jobs are at risk and begin to look for work elsewhere. The danger is particularly grave when this attitude begins to affect company loyalists, the employees who are the glue of the organization. When they begin to worry others will also.

During challenging times, rumors spread throughout an organization like cancer. Because of this, management should openly inform remaining employees about the plan to revitalize the organization, and address whispering campaigns head on. Allowing rumors to linger without clarification feeds into the belief that the organization's future is uncertain.

Employees will look towards the leadership for reassurance and encouragement so it is important to be visible, and address employee concerns. With open, honest communication the possibility exists to develop a rich relationship with those who remain.

And here is another random article you might be interested in...

Are Payday Loans Good For You?

Millions of people make use of payday loans every year, and their number is increasing. Yet the payday loan industry is also the favorite whipping boy of several organizations. The allegations against the industry are well known: that they charge a high interest rate, and push low-income people further into debt.

There have been arguments for and against this position. Yet the fact is the industry has continued to grow, and more people access their services every year. What is more, some banks have also extended credit lines to payday loan lenders in order to get a finger into the growing pie. The irony is that the banks refuse to lend to people the payday loan industry serve, yet want a portion of the profits. This is a convenient way of making profits without being held accountable for not providing services to the needy.

Most people who access payday loans do so because the banks refuse to lend to them because of their bad credit scores. Or because they do not have a credit history -- which is due to no fault of their own -- as in the case of individuals just out of college. Add to that, the payday loan lenders have made it quite easy to get payday cash advances.

The online cash advance Websites have made the process so easy and fast, it is better than visiting the local pawn shop or borrowing from your friends when you are in need of emergency cash. Recent technical advances such as the Internet have now obviated even the need to fax documents as proof of loan information when you apply for a payday loan online.

Payday loans are short-term loans that are given regardless of an individual's credit score. Despite all the saber rattling against the industry, we cannot overlook the fact that these loans are a great help to cash-strapped individuals. They can help stabilize your finances following an unforeseen cash emergency. Also, if you manage your finances well, there is no need to fear cash advance loans.

The cash advance loans add to your debt burden only when you are bad with managing your finances. If you fail to repay your payday advance on time, the debt will spiral upward. And you will find it hard to bring it under control.

For this reason, no one should be encouraged to look at payday advances as an everyday financial resource. They should be availed only in cases of urgent cash needs. The payday loan lenders encourage this by limiting the amount loaned to a first-time lender to $500. If he repays on time, he can get higher amounts when he applies for subsequent payday loans.

And payday loans are going to stay. But because they are a great financial tool. But because the payday loan industry has been a leading contributor to US elections. Their contributions have climbed year after year. No one likes to kill a goose that gives golden eggs. Least of all the politicians.