Exploring the Effects of the Procedural Justice of Downsizing on Survivors' Behaviour

Abstract

Downsizing is seen as a commonly chosen strategy to improve organizational efficiency, effectiveness, performance, competitiveness, and to regain financial stability. After the decision on the downsizing was made and the downsizing was conducted, special attention should be placed on those employees who survived the downsizing. The purpose of this paper is to observe how the procedural fairness of the downsizing method applied impacts the survivers' behaviour. The primary assumption is that the characteristics of the employed downsizing method, here observed Clarity, Validity, and Accuracy, impact the attitudes of survivors viewed through Motivation, Satisfaction, and Turnover Intention. A questionnaire was developed and distributed to 556 employees who had survived downsizing to verify the proposed conceptual model. The results of the study supported the claim that characteristics of the downsizing method influence the survivors' behaviour, whereas Validity stands out for its relatively strong impact on Motivation and Satisfaction with the organisation to which the survivors belong. The findings illustrate that when conducting downsizing, managers and decision makers should consider the fairness of downsizing method applied because, if conducted in an adequate manner, dowsizing can even induce positive behavior of the surviving members.