Why company involved in restructuring? Ans: 1.

Restructuring is the corporate management term for the act of reorganizing the legal,
ownership, operational, or other structures of accompany for the purpose of making it more profitable, or better organized for its present needs. Other reasons for restructuring include a change of ownership or ownership structure, demerger, or a response to a crisis or major change in the business such as bankruptcy, repositioning, or buyout. Restructuring may also be described as corporate restructuring, debt restructuring and financial restructuring. Executives involved in restructuring often hire financial and legal advisors to assist in the transaction details and negotiation. It may also be done by a new CEO hired specifically to make the difficult and controversial decisions required to save or reposition the company. It generally involves financing debt, selling portions of the company to investors, and reorganizing or reducing operations. The basic nature of restructuring is a zero sum game. Strategic restructuring reduces financial losses, simultaneously reducing tensions between debt and equity holders to facilitate a prompt resolution of a distressed situation. Steps: ensure the company has enough liquidity to operate during implementation of a complete restructuring produce accurate working capital forecasts provide open and clear lines of communication with creditors who mostly control the company's ability to raise financing update detailed business plan and considerations

Restructuring is more likely to be successful when managers first understand the fundamental business/strategic problem or opportunity that their company faces. At Humana Inc., which jointly operated a hospital business and a health insurance business, management decided to split the businesses apart through a corporate spin-off because it realized the businesses were strategically incompatiblethe customers of one business were competitors with the other. Alternative restructuring options that were considered, including issuing tracking stock, doing a leveraged buyout, or repurchasing shares, would not have solved this underlying business problem. 2.Conclusion about the downsizing and restructuring? Ans: Corporate reputation is a very important intangible resource. Referent literature suggests that corporate reputation can be a significant source of sustainable competitive advantage. Corporate reputation is the public assessment of the key identity and image of an organization making a favourable long term position. However, many management activities and actions have the potential to decrease this valuable resource. One of the practices that has the greatest potential to decrease it is downsizing. This strategy has a great potential to have a negative influence on many stakeholders, especially employees, customers and community and therefore to decrease corporate reputation. Investigations on how downsizing affects corporate reputation are very rare but they are important for at least two reasons. First, this kind of investigations could assists in better management of this valuable resource. Second, the investigation of this influence can reduce downsizing as the solution, since a lot of evidence shows that downsizing

failed to increase organizational performances. Downsizing influence on the corporate reputation we investigate each dimension that determines corporate reputation index: quality of management, quality of products/services offered, innovativeness, value as a long term investment, soundness of financial position, ability to attract, develop and keep talented people, responsibility to the community and environment, and wise use of corporate assets. Downsizing decision should not be a short-term solution in the attempt to reduce costs and increase profit. Instead, it has to be integrated into a well-crafted vision that makes it clear how downsizing will create competitive advantage. Only in that case, downsizing might positively influence corporate reputation. However, despite the fact that most arguments are against the downsizing benefits, managers have continued this practice. At the same time, academics have continued debates about this controversial topic.

Restructuring is usually perceived as a change of a certain organism structure [12]. We can then distinguish changes at macro and micro levels, as results from the following definition. Restructuring change of a particular economic area structure, change of production programmes and enterprising activities. [8]. When dealing with a structural change of a national economy particular field we then use the term of a macroeconomic restructuring. If a change is being witnessed in an enterprise structure, we then use a term a microeconomic restructuring. In terms of a microeconomic restructuring there might occur changes both at the company level and at the levels of its particular parts. Restructuring represents an essential reconstruction of an enterprise strategy, structures and processes and their tuning with the new reality [4]. Restructuring means overall enterprise reorganizing, renewing all its enterprising functions [15]. Restructuring represents enterprise oriented and system holistic changes of a managed organization unit (enterprise, plant, autonomous business unit etc.). [17] The restructuring is a process of making a major change in organization structure that often involves reducing management levels and possibly changing components of the organization through divestiture and/or acquisition, as well as shrinking the size of the work force. [1] Restructuring deals with the structure of organization and is usually associated with cultural change. The first stage is to conduct an economic model of the processes of the organization, to give a detailed view of where and how value is created, and to ensure that resources can be provided to different parts of the organization as and when required. Next is the alignment of the physical infrastructure of the organization, and then redesign of the work architecture or processes of the organization. It is also necessary to achieve market focus, invent new businesses and change the rules of competition through technology. The task is also to create a reward structure to provide a powerful motivating force and then to build individual learning the encouragement for individuals to acquire the new skills necessary for the success of the transformed company. The final stage is to develop the organization which will be able to adopt constantly to changing circumstances. [7] It means that a company restructuring is based on changes touching all spheres of an enterprise life. A company restructuring affects changes in production, enterprise sources, their interconnection and their use and may be followed by an organization architecture changes [16]. The more detailed identification of particular areas of restructuring changes is offered by Vodek, Vodkov, who define the restructuring process as follows: It is a process of assuring sources, introducing innovation changes while creating and mutually harmonizing production programme structures, a production-technical basis, functional and organization structures, personal structures, or as the case may be, further pragmatic structures (e.g. financial structures) so that an effective and efficient reproduction process functioning can be achieved. [18]. However, we can meet other content and scope concepts of the expression of a company restructuring. Some authors, e.g. Pamphilis [10] understand the term of restructuring only as a change in a property and finance company structure. In the narrowest concept a company restructuring means only a change in enterprise property relations (see e.g. Gaughan [2]).

Impact of downsizing on organization HRM issue? 3. Originally

written about downsizing within the public sector, the points in this article are no less applicable to any organization that is forced to undergo downsizing. Interestingly enough, almost all surveys and research examining the long term effects of downsizing indicate that companies that downsized ended up disappointed in the results. Layoffs may serve a short term need, but create huge longer term issues. Few government departments or branches have escaped the necessity of downsizing. The last three or four years have brought almost constant cuts in staffing, and some departments have been "hit" several times. For many downsizing has become an annual process. When managers are faced with downsizing, they tend to focus on the immediate and practical needs that emerge at the time when staff are being let go. After all, employees need to be selected and notified, one of the most difficult tasks for any manager. Jobs responsibilities need to be shuffled, and generally the period where downsizing is occurring is very busy and emotionally taxing. Unfortunately, there is a tendency for managers to focus on those that are leaving rather than those that remain. This also holds true for central training and consulting agencies who are asked to support the laid off employees with career development help, counselling, and other supports. There is no question that laid off employees deserve and need these kinds of supports and services. Unfortunately, there is a tendency to forget that after the laid-off workers are gone, the "survivors" must soldier on, and the manager must deal with the long-term effects on the remaining organization. We are now seeing the effects of downsizing on those that remain. One of the most telling comments is often put forth by employees a year or two after downsizing, and it goes like this: "Sometimes I think that the ones who were laid off are the lucky ones". They usually go on to describe a workplace where employees feel: . a lack of executive commitment to their functions . confusion about the priorities of their organization . increased workloads . confusion about their mandate . a sense of being betrayed by executives and managers . a profound sense of distrust . a sense of futility with respect to long-term planning . undervalued and unappreciated In operational terms, this translates into a number of problems. . the organization moves towards less risk-taking and innovation . destructive conflict tends to increase

. internal competition for resources increases . individual staff members devote less effort to working together and more attention to doing things that will protect themselves. . general listlessness and lethargy . decreases service levels and increased public hostility It is easy to understand these effects when they occur close to the time when downsizing occurs, and remaining staff "grieve" the loss of friends and colleagues. But, these effects are now being seen as long as one or two years AFTER the downsizing period. There are indeed long term effects of downsizing that need to be addressed.

Understanding The Organizational Downcycle

To counter-act the long term effects of downsizing, managers need to understand how organizations slip into "downcycles". An organizational downcycle can be characterized as a long-term process where the organization becomes progressively more depressed, insular, protective and confused. The important thing to note is that this process occurs slowly, sometimes imperceptibly, and that if the process is allowed to continue unchecked, it gets worse. The downcycling organization loses its positive momentum and enthusiasm. A vicious circle is formed. It snowballs. Bad feelings and depression become the norm rather than occasional, until, in extreme cases, the organization becomes unable to move effectively, and the work climate can become intolerable for everyone. Because the process tends to be gradual, managers tend to assume that the problems that occur early in the downcycling will solve themselves without attention. It is easy to assume that staff will "get over" the effects of downsizing over time. This may be the fatal mistake, because if the process is left unmanaged, there is a good chance that staff will become more demoralized. One final point on the downcycle is in order. When an organization is close to the bottom of a downcycle, it is extremely difficult to turn the organization around. This is because levels of trust, hope and enthusiasm are so low that staff will have little faith in the effectiveness of any approach that promises to be helpful.

Some Prescriptions
1. Proactive management activities are always required when downsizing occurs. Managers must realize that they "can pay now or pay later", and that delaying actions designed to revitalize the organization will result in a huge cost down the road. Managers should consider that the period immediately after downsizing is critical. Action or inaction during this period will determine whether the organization moves

into a depressed downcycle, or makes the commitment to move forward. Downsizing time should also be a time when the organization's mandate and vision are revisited. It should be a time when the manager dedicates him/herself to the long-term health of the organization by clarifying, supporting and building trust. Above all, this is the time where the manager's prime responsibility is to communicate, both with staff, and with executives. One focus of communication should be clarifying mandate, vision, priorities and commitment levels. 2. Proactive long-term approaches should also be applied by any central agencies charged with "helping" downsizing organizations. Support should be offered to those that are displaced, but, in the long term, help offered to "survivors" will be much more important in determining organizational health. As a manager, ask, or demand that these services be made available by central agencies, or procure them from private vendors, if the central agency won't do the job. 3. If you are in the unfortunate position of managing an organization that is "downcycling", you need to be aware of two things. First, it will get worse if neglected. Second, interventions to turn the cycle around must be considered as long-term projects. One shot consulting or training isn't going to do much, and it may be damaging. Remember that your organization may have been moving downward for a year or two, and that it is going to take a substantial period of time to reverse the process. Positive change will require a consistent effort on your part, and may require consulting help over a period as long as a year. Conclusion We are seeing more of the long-term effects of downsizing on organizational health. When downsizing is undermanaged, there is the danger that an organizational downcycle will be created, and left to continue unchecked over several years. The results can be destructive to the organization and the individuals that work there. It is far easier to avoid or correct this cycle at the time when downsizing occurs, and far less costly. It is important that downsizing trigger organizational renewal strategies immediately. If proactive action is missing, or is ineffective, corrective actions down the road will require a long term commitment. Once an organization reaches the bottom of a downcycle, it will take considerable time to reverse the process.

4. Impact

of downsizing on organization labor relation Issue?

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6. Downsizing and high involvement HRM?

ABSTRACT: What is the impact of downsizing? As the studies below indicate, layoffs have a number of negative effects not only on workers in different industries, but also on their communities and the market as a whole. Although it has been said that downsizing can be economically beneficial to companies, the following shows that there are two sides to this issue.

Over the past decade, the workplace has altered considerably in terms of job stability. People have either experienced layoffs firsthand or directly known someone else who was impacted by re-engineering, downsizing, outsourcing or acquisition. For employees adversely affected by these changes or for those who do not completely understand why these changes are occurring, the effects can be very disturbing and impact both their personal and job life. A variety of different industries have been impacted by layoffs, not only manufacturing. For example, hospitals like other companies and nonprofit organizations have experienced downsizing that has negatively impacted healthcare employees with varying degrees of psychological distress and poor health. In a 2002 study, Greenglass, Burke and Fiksenbaum showed that restructuring and its changes can result in lower job satisfaction and job insecurity. The researchers studied the relationship between impact of restructuring, job satisfaction, job insecurity and absenteeism in nurses. The results were similar to earlier studies indicating that job insecurity can often have harmful consequences for individuals. Job insecurity has frequently been reported to lead to decreased psychological well-being (Dekker & Schaufeli, 1995; Ferrie et al., 1998). In a study of Finnish employees, Kinnunen et al. (2000) reported that job insecurity, which led to negative relationships with colleagues and superiors, was still being noted at least one year after the event. The respondents of the Greenglass study, who consisted of 1,363 nurses employed in hospitals that were undergoing extensive restructuring, first filled out a self-report anonymous questionnaire. Results of this study demonstrated that the impact of hospital restructuring had a direct effect on job satisfaction, which in turn then had a pointedly negative impact on absenteeism and on job insecurity. In addition, the study found that the more the nurses believed hospital restructuring had lowered the quality of health care and had had a negative impact on working conditions, the less likely they were to experience job satisfaction and the more apt to report feelings of job insecurity. Findings further demonstrated that job satisfaction functioned as a intermediary between the impact of restructuring and job insecurity: That is, lower job satisfaction resulting from a greater impact of restructuring led to decreased job security. The impact of restructuring also placed an indirect effect on absenteeism through job satisfaction. The lower the job satisfaction, resulting from restructuring, the more likely the nurses were to be miss work

6.