Downsizing Digest Saturday, 25 January 1997 Volume 01 : Number 010
In this issue:
stockholders and downsizing
Organizational growth vs. downsizing
Re: Organizational growth vs. downsizing
Re: Organizational growth vs. downsizing
Re: Organizational growth vs. downsizing
Unsubscribe
unsubscribe
New Web URL for Online Quality Forum (fwd)
Re: The downsizing list
Re: The downsizing list
BOUNCE downsizing@quality.org: Non-member submission from ["Smith, Ron D." ] (fwd)
Re: BOUNCE downsizing@quality.org: Non-member submission from ["Smith, Ron D." ] (fwd)
----------------------------------------------------------------------
From: Asif Raza
Date: Fri, 17 Jan 1997 17:07:32 -0600
Subject: stockholders and downsizing
From: Asif Raza
Hello Luis,
I was wondering if you have any data that shows downsizing in most
cases is pushed by the stockholders and not the management. If you do I
would be very interested in it.
A theory called the multiple constituencies theory would support
your statement.
Asif Raza
Loyola University Chicago
>TQM cannot provide all the answers. In most of the cases downsizing is
>pushed by stockholders, not management. They want to try desperately to
>save the ship.
>
>Any activity carries an ammount of risk and loss recovery. Ask
>stockholders...
>
>Luis Lacambra
>
>
>
------------------------------
From: "Michael D. 'Mike' Townes"
Date: Fri, 17 Jan 1997 00:41:02 -0800
Subject: Organizational growth vs. downsizing
From: "Michael D. 'Mike' Townes"
Several have written that organizations have actually grown where there
was the impression of downsizing.
In many cases, both are true; the organization was downsizing and
growing at the same time. This happens when the shift in technology
or other factors obsoletes various jobs that may be replaces with an
equal or larger number of other jobs. Today, those other jobs very
often require quite different skills and pay less.
One of the challenges is to figure out how to accomplish both the
technical and the social/cultural challenges of job changes within
the organization; often involving managers of people who become managers
of things and systems because technology allows broader spans of
control. I have to know how to train old dogs in new tricks and I have
to help old dogs change their paradigm of what kinds of tricks they
should be performing.
These are not easy challenges. And, how is it all to be paid for? My
personal thought is that if one is reluctant to help improve productiv-
ity to line the shareholders' pockets (usually an oversimplification,
especially where employees are often shareholders, too), then why
not work on productivity and in a way that ties to shifting job
skills and responsibilities to maintain the viability of jobs.
Enough expounding for now... Best regards,
- --
Michael D. 'Mike' Townes, Quality Specialist, USPS
3504 Emerald Cove Dr.
Flower Mound, TX 75028-7853
mdtownes@iamerica.net W:214-819-8797 H:972-355-7222
------------------------------
From: Leslie Morgan
Date: Sat, 18 Jan 1997 10:37:53 -0800
Subject: Re: Organizational growth vs. downsizing
From: Leslie Morgan
> Several have written that organizations have actually grown where there
> was the impression of downsizing.
>
> In many cases, both are true; the organization was downsizing and
> growing at the same time. This happens when the shift in technology
> or other factors obsoletes various jobs that may be replaces with an
> equal or larger number of other jobs. Today, those other jobs very
> often require quite different skills and pay less.
I've been lurking for some time, but this one I just can't resist.
I have seen many cases where companies allegedly "downsize" while
hiring new employees. (AT&T, PacTel, Chevron, Mobile Oil, Lockheed
Martin, etc)
The "new" jobs require no difference in skill sets. Nor do they appear
to be
different from the "old" jobs in any significant way. In some
instances, the
very same employees that don't have the "required" skills return to
their
old work only as a contract (long term temp) employee.
In the cases where the same employee occupies the same (or similar)
position
performing the same work as was "downsized", what is the possible
rationale
for the "downsizing", "right-sizing", or "upsizing"???
> One of the challenges is to figure out how to accomplish both the
> technical and the social/cultural challenges of job changes within
> the organization; often involving managers of people who become managers
> of things and systems because technology allows broader spans of
> control. I have to know how to train old dogs in new tricks and I have
> to help old dogs change their paradigm of what kinds of tricks they
> should be performing.
>
> These are not easy challenges. And, how is it all to be paid for? My
> personal thought is that if one is reluctant to help improve productiv-
> ity to line the shareholders' pockets (usually an oversimplification,
> especially where employees are often shareholders, too), then why
> not work on productivity and in a way that ties to shifting job
> skills and responsibilities to maintain the viability of jobs.
IMHO, this is something that would need to be demonstrated by example.
Unfortunately,
many employees see who is downsized and who is not, and there is no
correlation (sp?) between skills and jobs. I have seen hundreds of
employees terminated or otherwise pushed out that had far superior
skills to those who were retained. Unscientific as it may be, I noticed
the primary difference in the two groups:
1. "Downsized" - Older, more experienced, usually one or more degrees,
ethical beyond
question, high standards, uncompromising on
quality/service, focused
on group success.
2. Not "Downsized" - younger, frequently fresh out of college with no
experience,
more concerned with looking good than being good,
willing to
say "yes" even when "no" is the right answer,
focused on
personal success
I realize these are generalizations. All I'm saying is this is what I
noticed.
It may not be true in all circumstances, but in the cases where it is
true, is there
hope for the organization?
Leslie Morgan
http://www.upsizedown.com
------------------------------
From: "Gary"
Date: Sat, 18 Jan 1997 16:23:06 -0500
Subject: Re: Organizational growth vs. downsizing
From: "Gary"
Since I work at AT&T and have for 18 years (knock on wood, hurry!), let me
take a stab at this one. I think the answer, plain and simple, is that
companies like AT&T and others are eliminating lower level, non-technical
experience and re-hiring personnel off the street for less money and less
overhead expenses.
- ----------
> From: Leslie Morgan
> To: downsizing@quality.org; mdtownes@iamerica.net
> Subject: Re: Organizational growth vs. downsizing
> Date: Saturday, January 18, 1997 1:37 PM
>
> From: Leslie Morgan
> > Several have written that organizations have actually grown where there
> > was the impression of downsizing.
> >
> > In many cases, both are true; the organization was downsizing and
> > growing at the same time. This happens when the shift in technology
> > or other factors obsoletes various jobs that may be replaces with an
> > equal or larger number of other jobs. Today, those other jobs very
> > often require quite different skills and pay less.
>
> I've been lurking for some time, but this one I just can't resist.
> I have seen many cases where companies allegedly "downsize" while
> hiring new employees. (AT&T, PacTel, Chevron, Mobile Oil, Lockheed
> Martin, etc)
> The "new" jobs require no difference in skill sets. Nor do they appear
> to be
> different from the "old" jobs in any significant way. In some
> instances, the
> very same employees that don't have the "required" skills return to
> their
> old work only as a contract (long term temp) employee.
>
> In the cases where the same employee occupies the same (or similar)
> position
> performing the same work as was "downsized", what is the possible
> rationale
> for the "downsizing", "right-sizing", or "upsizing"???
>
> > One of the challenges is to figure out how to accomplish both the
> > technical and the social/cultural challenges of job changes within
> > the organization; often involving managers of people who become
managers
> > of things and systems because technology allows broader spans of
> > control. I have to know how to train old dogs in new tricks and I have
> > to help old dogs change their paradigm of what kinds of tricks they
> > should be performing.
> >
> > These are not easy challenges. And, how is it all to be paid for? My
> > personal thought is that if one is reluctant to help improve productiv-
> > ity to line the shareholders' pockets (usually an oversimplification,
> > especially where employees are often shareholders, too), then why
> > not work on productivity and in a way that ties to shifting job
> > skills and responsibilities to maintain the viability of jobs.
>
> IMHO, this is something that would need to be demonstrated by example.
> Unfortunately,
> many employees see who is downsized and who is not, and there is no
> correlation (sp?) between skills and jobs. I have seen hundreds of
> employees terminated or otherwise pushed out that had far superior
> skills to those who were retained. Unscientific as it may be, I noticed
> the primary difference in the two groups:
>
> 1. "Downsized" - Older, more experienced, usually one or more degrees,
> ethical beyond
> question, high standards, uncompromising on
> quality/service, focused
> on group success.
>
> 2. Not "Downsized" - younger, frequently fresh out of college with no
> experience,
> more concerned with looking good than being good,
> willing to
> say "yes" even when "no" is the right answer,
> focused on
> personal success
>
> I realize these are generalizations. All I'm saying is this is what I
> noticed.
> It may not be true in all circumstances, but in the cases where it is
> true, is there
> hope for the organization?
>
>
> Leslie Morgan
> http://www.upsizedown.com
------------------------------
From: Leslie Morgan
Date: Sat, 18 Jan 1997 15:55:13 -0800
Subject: Re: Organizational growth vs. downsizing
From: Leslie Morgan
> From: "Gary"
> Since I work at AT&T and have for 18 years (knock on wood, hurry!), let me
> take a stab at this one. I think the answer, plain and simple, is that
> companies like AT&T and others are eliminating lower level, non-technical
> experience and re-hiring personnel off the street for less money and less
> overhead expenses.
I would say that is at least partially correct. It is true that AT&T
has been
replacing long term employees with new hires for a number of years.
However,
the phrase "downsizing" or "rightsizing" is misleading since it (at
least to me!)
implies the number of people is being adjusted. In reality, it is the
cost per person that is being downsized.
I have not worked directly for AT&T, but I have worked with a number of
people there, and most report no significant difference in skills
between the new and former employees. (I talked to primarily marketing,
engineering, and installation folks)
If that is the case, they are not making any real improvement, but
really just cutting costs.
I had an interesting experience the day after AT&T announced it's big
40k cuts. I called a contract employment agency looking for work. (I
have 17 years telcom experience) They immediately tried to place me
with my former employer. When I said
I was open to any contract work, the answer was "Well, we do have a
number of jobs coming up with AT&T....what with their layoffs and all."
If my assessment is correct, AT&T knew they would be replacing direct
employees with indirect employees when they announced the layoffs. I
can only wonder how many of the "new" contractors are the very same
employees who supposedly didn't have technical skills (or whatever was
used for the selection criteria).
I also wonder what the long term consequences of this type of employee
churn, under the guise of downsizing, will be. I do believe capitalism
will eventually teach those who do not already know that the
employee/employer relationship is most productive when symbiotic beyond
just the exchange of money for work.
Leslie Morgan
http://www.upsizedown.com
------------------------------
From: "Gary"
Date: Sun, 19 Jan 1997 12:52:55 -0500
Subject: Unsubscribe
From: "Gary"
I would like to unsubscribe to the email distribution list.
Thank you,
Gary Faircloth
------------------------------
From: "Madeline Ritter"
Date: Mon, 20 Jan 1997 09:03:29 -0500
Subject: unsubscribe
From: "Madeline Ritter"
unsubscribe
------------------------------
From: "Bill Casti, CQA (Moderator)"
Date: Mon, 20 Jan 1997 10:46:29 -0500 (GMT-0500)
Subject: New Web URL for Online Quality Forum (fwd)
From: "Bill Casti, CQA (Moderator)"
NOTE: This message is being mass-distributed to all lists supported at
QUALITY.ORG. If you belong to more than one list, you will get more than
one copy. There's no simple way to prevent it, so instead of beating me up
about it, just exercise your "delete" key to get rid of the "extras".
Thanks.
Bill
- ---------- Forwarded message ----------
Date: Sun, 19 Jan 97 22:27:01 CDT
From: Administrator@qof.com
Subject: New Web Address
Bill,
We have had a change in our web address. I would greatly appreciate it if you
would send the following messages on the appropriate discussion lists. Thanks.
John
- -------
Web Address for Quality Online Forum Has Changed
The URL for the Quality Online Forum website has just changed. The new
address is
http://www.qof.com/
While the old site is supposed to be active for the next sixty days, some
people have had trouble accessing it. We apologize for any incovenience.
John Shoemaker
President, Quality Online Forum
------------------------------
From: "Ing. Luis Lacambra"
Date: Thu, 23 Jan 1997 19:47:06 -0800
Subject: Re: The downsizing list
From: "Ing. Luis Lacambra"
Is there anyone that has worked during a dowsizing program that is
positive?. One that has been accepted by people? I would like to know how
it was done.
Most of the comments seem to be very negative. Perhaps the examples
mentioned in the list are not of downsizing but of doubdtful company
ethics. They found out the other side was lying.
Is this forum run in the US or Cuba? Havana is the last place where
capitalism is bad in the american continent... Even so they are open to
discussion and greenbacks.
Want to be free, start your own company. I did it myself.
Luis Lacambra
------------------------------
From: Ray Martin
Date: Fri, 24 Jan 1997 03:56:02 -0600
Subject: Re: The downsizing list
From: Ray Martin
Luis, other Downsizing colleagues:
The downsizing with which I am most familiar (US Federal Government) was
quite positive if viewed objectively: spread over several months
or years, buyouts, job offers elsewhere, considerable relocation
assistance . . . The actual "downsizing" was a very minor one (about
half normal annual attrition), with greatly offsetting upsizings
elsewhere in federal, state and local government. Many of the
"downsized" individuals would have had priority in the uspizings
elsewhere under federal civil service rules. And the skills to be
competitive for state-run federal programs. Since the minor downsizing
was the result of the end of the Cold War, a rational person would, I
believe, acknowledge its appropriateness.
That was accepted well by some people. The departures were on generous
terms.
You are right though. We've heard nothing but complaining--most from
individuals who were affected. The end of the Cold War interfered with
their career plans. But I think that's what you're going to find on a
Downsizing list.
I volunteered to downsize myself (from US federal government) several
years ago. That cut the excess from about ten times more than needed to
do what should be done to 9.9 times.
Ray Martin
rmartin@texas.net
Ing. Luis Lacambra wrote:
>
> From: "Ing. Luis Lacambra"
> Is there anyone that has worked during a dowsizing program that is
> positive?. One that has been accepted by people? I would like to know how
> it was done.
>
> Most of the comments seem to be very negative. Perhaps the examples
> mentioned in the list are not of downsizing but of doubdtful company
> ethics. They found out the other side was lying.
>
> Is this forum run in the US or Cuba? Havana is the last place where
> capitalism is bad in the american continent... Even so they are open to
> discussion and greenbacks.
>
> Want to be free, start your own company. I did it myself.
>
> Luis Lacambra
------------------------------
From: "Bill Casti, CQA (Moderator)"
Date: Fri, 24 Jan 1997 19:49:41 -0500 (GMT-0500)
Subject: BOUNCE downsizing@quality.org: Non-member submission from ["Smith, Ron D." ] (fwd)
From: "Bill Casti, CQA (Moderator)"
NOTE: Respond *both* to the poster's address (see below) and to the list's
posting address, OR as directed in the posting, but definitely NOT to me.
Thanks.
Bill
- ---------- Forwarded message ----------
Date: Fri, 24 Jan 1997 08:34:59 -0500
From: "Smith, Ron D."
To: "'DOWNSIZING'"
Subject: FW: The downsizing list
I think Ray has hit the nail on the head, especially in the government,
where there are always way more "Feds" than necessary, where the
contractors are hired to do most of the work. But, there is a greater
"THEORETICAL" point to be made that includes general industry and the
govt as well, in my opinion.
Workloads in any business constantly change which require less staffing
or at least require the rearrangement of staffing within organizations.
I believe that business or government entities fall way behind in
making adjustments to keep up with appropriate staffing levels, which
then can result in overstaffing....maybe due to some organizations
wanting to "empire build". This in turn results in later massive
rightsizing when operating costs become over the line, then everyone
gets a bad taste from the resultant layoffs.
If closer and better management controls were maintained over the work
in a business organization, then I believe that downward adjustments of
employees would not be so massive, drastic or sudden.
It is easy for companies to be internally convinced to become slowly
overstaffed by some management but generally harder to keep the balance
of "staff to workload" in line. Proper controls should not result in a
revolving employee base....hire and layoff, hire and layoff, ad
infinitum, to any great degree. I have seen this work to some positive
degree.
I believe the massive layoffs in business generate lots of negatives
toward the company and business in general. Occassional adjustments in
the workforce (excepting business or product line failures or
obsolesence, etc.) are recognized by employees as necessary, whether
they make anyone feel good or not.....certainly not the enormous
negative feelings we would see otherwise.
Anyway, just some rambling thoughts and my opinions only.....realizing
the above approach may not be realistic but in theory only. I have
worked for managers that do well in controlling and preventing
overstaffing which keeps their employees employed, busy and happy. AND
they (the mgr) do well in the company as leaders, also.
Ron Smith
ron.d.smith1@jsc.nasa.gov
----------
>From: Ray Martin
>Luis, other Downsizing colleagues:
>The downsizing with which I am most familiar (US Federal Government) was
>quite positive if viewed objectively: spread over several months
>or years, buyouts, job offers elsewhere, considerable relocation
>assistance . . . The actual "downsizing" was a very minor one (about
>half normal annual attrition), with greatly offsetting upsizings
>elsewhere in federal, state and local government. Many of the
>"downsized" individuals would have had priority in the uspizings
>elsewhere under federal civil service rules. And the skills to be
>competitive for state-run federal programs. Since the minor downsizing
>was the result of the end of the Cold War, a rational person would, I
>believe, acknowledge its appropriateness.
>That was accepted well by some people. The departures were on generous
>terms.
>You are right though. We've heard nothing but complaining--most from
>individuals who were affected. The end of the Cold War interfered with
>their career plans. But I think that's what you're going to find on a
>Downsizing list.
>I volunteered to downsize myself (from US federal government) several
>years ago. That cut the excess from about ten times more than needed to
>do what should be done to 9.9 times.
>Ray Martin
>rmartin@texas.net
------------------------------
From: Ray Martin
Date: Sat, 25 Jan 1997 10:01:44 -0600
Subject: Re: BOUNCE downsizing@quality.org: Non-member submission from ["Smith, Ron D." ] (fwd)
From: Ray Martin
Ron, other Downsizing (and Quality) colleagues:
Ron, Bill Casti apparently sent you over to the Downsizing list.
Thank you Ron. I largely agree with your comeback. However an important
difference is, perhaps the crucial one, is redundant staffing can
survive in government long after there is anything whatsoever to do.
Not just the USA and not just the federal executive--government. Only
that the US federal executive has greater access to the relative deep
pockets of the American taxpayer and a receptive bond market (passed on
to future taxpayers). Government redundancy can therefore survive
longer--decades in some cases.
Private/general industry lacks those deep pockets. Even a GM, an IBM or
a Microsoft will hit the bottom sometime. They cannot print money.
People, good people, have incentives to build empires in any
organization. Self preservation perhaps the most obvious. But the
desire to contribute something good and positive (even when the
organization's mission doesn't) is important to people too. It is a
natural phenomena, inherent in people. It causes little difficulty if
understood and managed.
Not sure this is what you are talking about Ron, but some government
managers are skilled at keeping employees "employed, busy and happy"
even though they are redundant. High activity level. Churning: papers,
plans, meetings, studies, seminars, workshops, initiatives, reviews,
reorganizations and the like. On a grand scale. These managers have no
incentive to reduce the staff. Quite the contrary, their incentive is
to increase the churning, justify it, and increase staff. Among other
things, this helps absorb excess budget, which is another management
problem, especially in the US federal executive.
Thanks for your response.
Ray Martin
rmartin@texas.net
Bill Casti, CQA (Moderator) wrote:
>
> From: "Bill Casti, CQA (Moderator)"
>
> NOTE: Respond *both* to the poster's address (see below) and to the list's
> posting address, OR as directed in the posting, but definitely NOT to me.
>
> Thanks.
> Bill
>
> ---------- Forwarded message ----------
> Date: Fri, 24 Jan 1997 08:34:59 -0500
> From: "Smith, Ron D."
> To: "'DOWNSIZING'"
> Subject: FW: The downsizing list
>
> I think Ray has hit the nail on the head, especially in the government,
> where there are always way more "Feds" than necessary, where the
> contractors are hired to do most of the work. But, there is a greater
> "THEORETICAL" point to be made that includes general industry and the
> govt as well, in my opinion.
>
> Workloads in any business constantly change which require less staffing
> or at least require the rearrangement of staffing within organizations.
> I believe that business or government entities fall way behind in
> making adjustments to keep up with appropriate staffing levels, which
> then can result in overstaffing....maybe due to some organizations
> wanting to "empire build". This in turn results in later massive
> rightsizing when operating costs become over the line, then everyone
> gets a bad taste from the resultant layoffs.
>
> If closer and better management controls were maintained over the work
> in a business organization, then I believe that downward adjustments of
> employees would not be so massive, drastic or sudden.
>
> It is easy for companies to be internally convinced to become slowly
> overstaffed by some management but generally harder to keep the balance
> of "staff to workload" in line. Proper controls should not result in a
> revolving employee base....hire and layoff, hire and layoff, ad
> infinitum, to any great degree. I have seen this work to some positive
> degree.
>
> I believe the massive layoffs in business generate lots of negatives
> toward the company and business in general. Occassional adjustments in
> the workforce (excepting business or product line failures or
> obsolesence, etc.) are recognized by employees as necessary, whether
> they make anyone feel good or not.....certainly not the enormous
> negative feelings we would see otherwise.
>
> Anyway, just some rambling thoughts and my opinions only.....realizing
> the above approach may not be realistic but in theory only. I have
> worked for managers that do well in controlling and preventing
> overstaffing which keeps their employees employed, busy and happy. AND
> they (the mgr) do well in the company as leaders, also.
>
> Ron Smith
> ron.d.smith1@jsc.nasa.gov
>
> ----------
>
> >From: Ray Martin
> >Luis, other Downsizing colleagues:
>
> >The downsizing with which I am most familiar (US Federal Government) was
> >quite positive if viewed objectively: spread over several months
> >or years, buyouts, job offers elsewhere, considerable relocation
> >assistance . . . The actual "downsizing" was a very minor one (about
> >half normal annual attrition), with greatly offsetting upsizings
> >elsewhere in federal, state and local government. Many of the
> >"downsized" individuals would have had priority in the uspizings
> >elsewhere under federal civil service rules. And the skills to be
> >competitive for state-run federal programs. Since the minor downsizing
> >was the result of the end of the Cold War, a rational person would, I
> >believe, acknowledge its appropriateness.
>
> >That was accepted well by some people. The departures were on generous
> >terms.
>
> >You are right though. We've heard nothing but complaining--most from
> >individuals who were affected. The end of the Cold War interfered with
> >their career plans. But I think that's what you're going to find on a
> >Downsizing list.
>
> >I volunteered to downsize myself (from US federal government) several
> >years ago. That cut the excess from about ten times more than needed to
> >do what should be done to 9.9 times.
>
> >Ray Martin
> >rmartin@texas.net
------------------------------
End of Downsizing Digest V1 #10
*******************************