2 Keys – Downsizing And Employee Work-Life Balance

The rapid changes in today’s business environment brings in significant new challenges for the Human Resources management. One important issue is responding to the increasing use of teams and project management. In addition, HRM must devise policies to address the needs of temporary employees and virtual workers, effectively manage downsizing and acknowledge growing employee demands for work life balance.

The advent of teams and project management is a major trend in today’s workplace. People who used to work alone on the shop floor, in the advertising department, or in the middle management are now thrown into teams and succeed as part of a group. Each member of the team acts like a manager, becoming responsible for quality standards, scheduling and even hiring and firing other team members. With the emphasis on projects, the distribution between job categories and descriptions are collapsing. Many of today’s workers cross functional and departmental boundaries and handle multiple tasks and responsibilities.

In the initial years of the twenty first century the largest employer in the US was a temporary employment agency, Manpower Inc. Temporary agencies such as Manpower grew rapidly during the 1990s and by 2001 there were more than 3.3 million workers in temporary firm placements. People in these temporary jobs did everything from data entry to becoming the interim CEO. Although in the past, most temporary workers were in clerical and manufacturing positions, in recent years the demand has grown for professionals, particularly financial  analysts, information technology specialist accountants, product managers, and operations experts. Temporary workers are people who work for an organization but not on a permanent or full time basis. This might include temporary placements, contracted professionals, leased employees, or part time workers. One estimate is that contingent workers make up at least 25% of the workforce. The use of contingent workers means reduced payroll and benefit costs, as well as increased flexibility for both employers and employees.


Related trends are virtual teams and telecommuting. Some virtual teams are made up entirely of people who are hired on a project by project basis. Team members are geographically or organizationally dispersed and rarely meet face to face doing their work instead through advanced information technologies and collaborative software. Telecommuting means using computers and telecommunications equipment to do work without going to an office. Tele service Resources has telephone agents who work entirely from home using state of the art call centre technology that provides seamless interaction with call centres.  Millions of people in the US and Europe telecommute on a regular or occasional basis. Wireless Internet devices, laptops, cell phones, and fax machines make it possible for people to work just about anywhere. There’s a growth of what is called extreme telecommuting which means that people live and work in countries far away from the organization’s physical location. For example, ABC works from his home in Indore, India, even though his company’s offices are located in China and Europe.

Telecommuting is one way  organizations are helping employees lead more balanced lives. By working partly from home, for example parents can avoid some of the conflicts they often feel with coordinating their work and family responsibilities. Flexible scheduling for regular employees is also important in today’s workplace. Approximately a one third or quarter of the workforce has flexible hours. When and where an employee does the job is becoming less important. In addition, broad work life balance initiatives have become a critical retention strategy. Managers are recognizing that people have personal needs that may require special attention. Some HR responses include benefits  such as on site gym facilities, childcare assistance and eldercare, and paid leaves or sabbaticals. In some industries, the war for talent is intense, and companies can’t afford to lose experienced and knowledgeable employees. Many European companies are miles ahead of US firms in supporting work life balance, as illustrated by the example.

In some cases, organizations have more people than they need and have to let some employees go. Downsizing refers to an international planned reduction in the size of a company’s workforce. Some researchers have found that massive downsizing has often not achieved the intended benefits and in some cases has significantly harmed the organization. Unless HRM departments manage the downsizing process layoffs, it can lead to decreased morale and performance. Managers can facilitate the downsizing process by regularly communicating with the employees and providing them with as much information as possible, providing assistance to workers who may lose their jobs, and using training and development to help address the emotional needs of remaining employees and enabling them to cope with new or additional responsibilities.

These issues present many challenges for the organizations and the human resource management, such as new ways of recruiting and compensation that address the interests and needs of contingent and virtual workers, new training methods that help people work cross functionally or new ways to retain valuable employees. All of these concerns are taken into consideration as human resource managers work towards the three primary HR goals: attracting, developing and maintaining an effective workforce.

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