Organizational downsizing: Constraining, cloning, learning

Abstract

While downsizing rages through the U.S. economy, there is a great deal of uncertainty about its bottom-line effects. This uncertainty raises questions about why corporations have been so eager to engage in downsizing. In this article, we propose an answer to these questions. Three social forces, which we call constraining, cloning and learning, frequently provide a major impetus for downsizing. We describe these forces, and point out conditions that lead to the adoption of downsizing without due regard for its mixed consequences. We suggest methods to improve executives' downsizing decision routines … methods that should enhance the chances of achieving intended benefits.