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The Gestalt of Organizational Downsizing: Downsizing Strategies as Packages of Change

Sarah J. Freeman

School of Business Administration, University of Wisconsin-Milwaukee, P.O. Box 742, Milwaukee, Wisconsin 53201sarah{at}csd.uwm.edu

This paper develops and examines a framework of downsizing processes at the organizational level. It builds on previous frameworks and literature by introducing new variables found to be important in a field study and by bringing empirical evidence to bear on conceptual underpinnings related to organizational downsizing and change. The framework developed identifies two general approaches that organizations use when undergoing downsizing and redesign, as well as patterns of activities and changes that accompany them. Downsizing driving redesign involves incremental and low-level change, and is associated with less communication and systematic analysis, narrow participation in change efforts, and lower magnitude change in other organizational attributes. Redesign driving downsizing involves more fundamental organizational change, and is associated with high-level changes that involve restructuring, more communication, broad participation in change efforts, advance systematic analysis, and the use of interorganizational relationships to further downsizing efforts.

Key Words: downsizing • redesign • restructuring • gestalt

Human Relations, Vol. 52, No. 12, 1505-1541 (1999)
DOI: 10.1177/001872679905201202
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