Reply to the below discussion and cite all work.
Steven Kiernan
Nov 12, 2022Nov 12 at 3:19pm
Steven Kiernan
Discussion Post 2
BUSI-411
Microsoft and other companies equivalent to Microsoft have had to make some adjustments to their organizational structure and capacity this year. There is not a good outcome for an employee that has to experience a layoff with their company, but one must understand that layoffs are not intentional in most cases and are needed for an organization to adapt to organizational and economical changes. “Organizational downsizing represents the strategic reduction of an organization’s workforce to reduce labor costs, increase profitability, and in times of severe economic shock (e.g., recession), to prevent organizational collapse” (Frone, Blais, 2020). According to Abc News Max Zahn, Microsoft was forced to lay off 1,000 of their employees this year due to Microsoft not meeting the expectations set for their investors. Microsoft missed their expectations by $.5 billion. The 1,000 employees that were laid off was less than one percent of Microsoft’s total employment of 221,000 employees. Microsoft was unable to meet its expected $52.4 billion due to economic changes. Along with economic challenges, Microsoft has also seen a decrease in its shares by 30%. “Due to economic challenges, layoffs are often viewed as an initial course of action within organizations, the rationale being to improve immediate company profitability and reduce costs” (Mujtaba, Senathip, 2020). Microsoft’s last layoff of internal employees was back in 2017 but unlike this most recent layoff of 2022, the 2017 layoff was to restructure the organization more towards selling. Most organizations downsize to produce a quick reaction to their organizational restructuring or to prove to their investors of making up the revenue somewhere else other than producing revenue from sales. “Typically, they turn to episodic restructuring and routine layoffs, but in the long term both damage employee engagement and company profitability” (Sucher, Gupta, 2018, pg.122). According to Sucher and Gupta’s article, is Microsoft’s decision to downsize better or worse for their overall, long-term goal?
Annotated Bibliography
Frone, M. R., & Blais, A. R. (2020). Organizational Downsizing, Work Conditions, and
Employee Outcomes: Identifying Targets for Workplace Intervention among Survivors. International journal of environmental research and public health, 17(3), 719. https://doi.org/10.3390/ijerph17030719Links to an external site.
The author directs their downsizing viewpoints to the effects of downsizing on U.S. workers surviving a downsizing, identifies affected work conditions that can serve as targets for workplace interventions, and provides insight into why organizational downsizing often fails to deliver anticipated financial and performance benefits to organizations.
Mujtaba, B. and Senathip, T. (2020) Layoffs and Downsizing Implications for the Leadership
Role of Human Resources. Journal of Service Science and Management, 13, 209-228. doi: 10.4236/jssm.2020.132014 Links to an external site..
The author shares the viewpoint of downsizing from the leadership of the human resources department. The article explains the reasoning behind different organizational downsizing decisions and how the Human Resource Department communicates that along with developing an understanding of the aftermath the organization goes through.
Sucher, S. J., & Gupta, S. (2018, May). Layoffs That Don’t Break Your Company. Harvard
Business Review, 122-129. Retrieved from https://hbr.org/2018/05/layoffs-that-dont-break-your-companyLinks to an external site.
The author explains that layoffs are not a necessary need for an organization. The article explains the effects of layoffs from a corporate viewpoint and an employee viewpoint. The article describes downsizing organizational change affects long-term organizational goals. It also explains another option of organizational change that produces long-term goals better than downsizing or decreasing employees.
https://abcnews.go.com/Business/microsoft-lays-off-1000-employees/story?id=91692309Links to an external site.
Abc News Max Zahn writes an article on Microsoft describing how many employees were laid off in 2022, the reasoning behind Microsoft’s layoffs, and Microsoft’s goals for the future.
