Managing Change Due to Downsizing and Outsourcing Essay Sample

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Among the most aggravating sources of integration problems in American companies are issues employees have with change in companies. Managing change is an important aspect of every manager’s job, and it is a necessary evil in all companies at one time or another. Making employees feel comfortable through a process of change should be of paramount concern to any manager worth her salt. Change in companies is where any material protocol or element of a job is different and makes the new procedure outside of the employees’ comfort zones. Effective handling can be difficult, especially in two extremely sensitive areas: downsizing and outsourcing. Downsizing occurs when a company realizes that, for one reason or another, they must cut their workforce in order to protect the finances of the company, or for other legitimate reasons. Outsourcing occurs when a company must take an aspect of their operation and give it to another independent outside company. This is also done for legitimate financial purposes.

Though these two operations are done for legitimate financial reasons and for the survival of the company, they are often times the most difficult element of change to deal with as a manager because of how much they affect the employees. If a manager considers the effect of downsizing and outsourcing from the perspective of the employee, it is easy to see how perception of such change can affect the employee much more than other types of change. For example, if a company begins integrating new software for employee use, the change that occurs will be dealt with by teaching the employees how the new software will actually help them. The employees do not see a threat to their jobs in this scenario; they simply may be angry or upset because they want to do things the old way or are intolerant to change. However, the type of change that a manager must face in downsizing and outsourcing are those that deeply affect employee psyche because en employee will feel as if their job is at risk and their entire work performance may suffer because of this ongoing fear.

Employees know that if downsizing happens or outsourcing is implemented that they may be the next ones to lose their job to someone at a different company or due to financial resources. This fear could cause a normally great employee to lose focus on their tasks at hand and worry more about what is happening in management meetings, what other employees are talking about, and concern themselves with whether they should be looking for another job. An employee may turn against their own company and begin to see them as more of an adversary, rather than doing their best to work in the company’s service. An employee could lose motivation and begin to wonder why they are working so hard. This constant fear takes a largely unnecessary financial toll on a company that is losing productivity for no reason. This is especially unnecessary for an employee that has nothing to worry about because their job isn’t at risk at all. An effective manager, using their personal resources, may do a great job at quelling the fears of the employee so that way they can get back to their tasks at hand. Potential ways to approach changes and begin to manage them should take place at the beginning, before the changes even take place. If the manager approaches breaking the news to their staff in a considerate way, then the transition should not be difficult.

A manager should consider the reasons that the company is making its changes and to understand the practical reasons for the changes that occur before going to their employees with the information. If a manager knows exactly why the changes are taking place and is well education on the fundamental reasons why the changes are occurring, the manager will be better equipped to approach the employee with the requisite information to set the employee’s mind at ease. What managers must realize is that employees are very perceptive. They can also see when managers are uncomfortable, evasive, or unsure of what they are saying. Nothing will make an employee fear for their jobs or the future of the company more than an evasive manager in a time of such need. Without holding the hands of their employees, a manager can quell great amounts of trepidation and apprehension about the proposed changes by simply confronting the issue with their employees, looking them in the eyes and being honest in their approach and explanation of what is happening.

Generally, downsizing and outsourcing occur for legitimate reasons. If these reasons are communicated to the employees from the start, they will at least be informed of the changes and to the status of their own jobs. When downsizing and outsourcing occur, a great way for a manager to approach the issue with their employees is to call everyone into a joint meeting at one time. Make it clear from the start that there will be no questions for the moment and the purpose of the meeting is simply to inform of the new changes. This is so that the employees that are going to panic won’t publicly raise questions at the meeting that will panic other employees. The group could easily get out of hand, angry, upset, or panicked due to one outrageous employee. Tell the employees that if any of them have any questions or concerns following the meeting, the manager will be more than happy to sit down with the employees one by one and address their individual issues privately. The meeting should be for the purpose of delivering the news at hand and letting it sink in so that the employees will deal with the initial blow and the issue can be addressed when there are cooler heads and more rational thoughts amongst the group. The manager should tell the employees the reasons that the changes are occurring and why they are necessary.

She should reinforce the fact that the changes are being made to save the company money and be sure that everyone who is left at the company will remain there by assuring them that the moves were made so that they could be saved. It will also help to explain that by downsizing the company, the resources that the company has aren’t spread so thin and the operating funds will better equip long term job security for the remaining employees. A manager could use analogies also to explain downsizing in a more practical manner that employees can better understand and accept- something that will make more sense. An example may be a truck that is too heavily loaded down with heavy rocks that it is hauling. It’s overflowing from the top and the truck cannot move as fast or as nimbly as other trucks hauling similar loads. The only way to make the truck move faster and more efficiently is to drop some of the rocks off the top so it’s not overloaded anymore.

There are still many rocks in the truck, just not so many that the truck cannot move, cannot turn, cannot make quick changes, etc. An employee may better be able to grasp an analogy like this as a practical idea that makes sense. It would help the employee to know that the company is not working against them, but is instead on their side and working as a team. An employer will then have to give the employees time to adjust to the news, then there can be a phase of addressing any issues face to face, calming any nerves with honesty, information and head-on addressing of the issue. Outsourcing is to be addressed similarly. If a company can save money and save other jobs by outsourcing to a more efficient company for some operations, the manager should let the employee know they can now be more confident in the company’s solvency and their ability to stay employed due to the extra operating funds available to the company as a resource. The next step comes in integrating the change into the company and embracing the culture of change.

Integration depends on the level of change that has occurred. When change occurs, adequate training is necessary if there is any job enrichment; otherwise, reassurance of a new type of global world where change and integration is a necessary evil may be the best approach to the employees. Employees, especially of an older generation, are used to employee loyalty and keeping things generally the same as it’s always been. However, in this new world of globalization, recession, and ever changing industry, employees must know that change will be constant and never ending.

Change should be something managers should continue to instill in their employees as a positive thing. Change is a good thing and it should be a signal to the employees that their company is acknowledging industry changes and is responding to them accordingly. It should be taught that change is a signal, not that an employee should be afraid for their job, but a signal that their company is making responsible changes in accordance with industry norms. All of these changes, if implemented appropriately, can make managing changes in downsizing and outsourcing an effective and necessary way to handle employee stress and concern, and assure the company that their employees will continue to deliver quality work in an efficient manner. Happy, informed employees will be an effective one in the workplace.

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