Downsizing Strategies in Calika Company for Change Management

The report analyzes the downsizing plan of Calika Company, detailing techniques like hiring freezes, early retirement buyouts, and workforce redesign. It discusses the financial and organizational impacts, along with the benefits such as cost reduction and improved efficiency. Ethical challenges including termination confidentiality and employee morale are also addressed. The study emphasizes the importance of strategic decision-making to ensure positive outcomes from downsizing efforts.

Running head: MANAGEMENT
Management
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Executive Summary
The report helps in analyzing the plan for downsizing in the respective company named
Calika Company as this will help in diagnosing the requirement of downsizing in the
company. The different responsibilities and roles of the different departments have to be
analyzed as this will help in understanding the techniques of downsizing. The different
benefits have to be analyzed as well as this helps in understanding the benefits to the
employees and employers in the organization as well.
The main aim of the report is to understand the different risks of downsizing as well as
possible techniques that has to be properly analyzed as well in order to understand the
requirement of the change management in the organization. There are different faults, errors
as well as conflict in the management due to the downsizing of the employees in the
organization. The purpose of the report is to properly analyze the different ethical challenges
that have to be tackled by the managers in the organization. Proper plan has to be
implemented as this will help in understanding the requirement of downsizing in the
companies.
The conclusion is based on the proper implementing plan that has to be properly adopted by
the company as this will help in understanding the requirement of downsizing in the
companies. The different kind of challenges that has been faced by the company has to be
discussed as well.

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2. Downsizing techniques (Decision making models, types, styles and approaches)
There are different techniques of downsizing that can be applied in the respective
organization named Calika Company. The downsizing has adopted different techniques that
are innovative in nature f removing the employees from payroll.
Hiring Freezes and attrition wherein it occurs when a person dies, quit or retire and
they are not replaced from organization. Unless the rate of turnover is high, the attrition will
help in removing a smaller number of individuals from the organization. This is one of the
most efficient methods that can be applied by employer and this is received with better
understanding of employees and employers in the organization (De Meuse & Dai, 2013).
Early retirement buyouts of the senior employees are other way of downsizing the
employees from workplace. In this case, the employers offer extra incentives to the
employees while offering them early retirement options. This can help in motivating the
employees in the organization and this will be a good alternative for downsizing as well
(Goesaert, Heinz & Vanormelingen, 2015).
A proper decision making level has to be adopted by the respective company as this
will help the employers in the organization to make rational decision about downsizing the
employees. Proper redesign of the workforce can help in eliminating the unnecessary works
as this will help in eliminating the positions that are not required in the respective
organization (Suttipun & Setyadi, 2017).
2. Benefits of downsizing
There are different benefits of downsizing of a company both to employees as well as
employers that are as follows:

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Savings in labor cost is one of the advantages of downsizing in the company as the
main motive of laying off the employees in the organization is to help in reducing the
labor expenses. There are companies that try to downsize employees at a high end pay
scale if it possible. Labor is one of the highest cost companies that incurs in the
operations of the business. The cutting jobs are one of the quickest ways to lower the
costs significantly as well (Jung & Mun, 2017).
Sale of assets is other advantage of downsizing of employees in the organization as
this will downsize the entire business wherein it will cut the cost of employees but the
assets has to be sold as well as this will help in properly downsize the number of
employees in the organization. The different equipments, supplies as well as furniture
are the other items that can be sold in order to raise the funds for the sizable
downsizing (Brauer & Laamanen, 2014).
Collective focus is the advantage of downsizing as this will benefit both employers
and employees in the organization. The supervisors in the company can work towards
to motivate the remaining employees in the organization and provide them more
career developmental and training opportunities (Jung, 2016). For this particular
purpose, the organization can take few resources that have been saved by properly
eliminating the costs from the positions that are less valuable in nature and properly
investing it on the employees who perform well in the organization (Carriger &
Carriger, 2017).
3. Ethical Challenges tackled by managers
Criteria for termination are one of the ethical challenges that are faced by the
respective organization. While downsizing the employees from the organization, it
will affect the sales and production of the company and this can have huge effect on
the company as well. When the employees are known by the higher officials of the

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company, the employees who are the favorite of the managers are kept in the payroll
and this is one of the main ethical challenges that are faced by the company. The
managers need to understand the loyalty of the customers along with the contribution
of each employee in the organization as this will help them in judging well and this
will have huge positive impact on the company.
Options to quit are another ethical challenge that is faced by the managers in the
company and this has to be tackled by the employers of the organization itself. There
are different employees who do not want to quit and do not want any kind of
termination history in their work records. In such cases, the employers of the
organization can introduce other ways of termination that may not affect the
confidence of the employees and offer them another position in the offices and this
will help in improving the confidence as well (Habel & Klarmann, 2015).
Confidentiality is other ethical issue faced by the managers and this is related to the
termination of the employees in the organization. This kind of issue can be tackled by
the employer of the organization wherein such termination problems should not be
discussed with the other employees and by following such strategy this can help in
maintaining proper confidentiality.

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References
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Carriger, M., & Carriger, M. (2017). Does size matter? The impact of the size of downsizing
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De Meuse, K. P., & Dai, G. (2013). Organizational downsizing: Its effect on financial
performance over time. Journal of Managerial Issues, 324-344.
Goesaert, T., Heinz, M., & Vanormelingen, S. (2015). Downsizing and firm performance:
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Jung, J., & Mun, E. (2017). Does Diffusion Make an Institutionally Contested Practice
Legitimate? Shareholder Responses to Downsizing in Japan, 1973–
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Suttipun, M., & Setyadi, D. A. (2017). How Does Triple Bottom Line Reporting Influence
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