Shattered dreams andbroken heartsOrganisational downsizing is considered to be an answer to cutting costs. But is it really?

www.innovationagency.com | South Africa, Johannesburg

2013

Scenario:In the last banking crisis many financial institutions were hit very hard.As a result some of them were forced to close their doors while others were able to survive by downsizing their staff requirements.This approach worked in the short term as it cut the immediate operating costs of the financial institutions in question. As a result of the massive cut in the size of the workforce however many business networks were severed and this had an effect on the functionality of the organisations.

Approach:By making use of SNA the financial institutions would have been able to downsize their workforce in a manner that ensured maximum efficiency and productivity was maintained. Monitoring the networks as seeing who among their workforce united networks and who did not they would be able to trim those that provided the least value to the organisation. This has the effect of lowering immediate cost while maintaining and possibly even streamlining the efficiency of the organisation.

Results:By performing a detailed social network analysis (SNA) the financial institutions that chose to downsize their workforce could have mapped the networks within their organisations and ensured that they did not disconnect highways of functionality. The social networks developed among the workforce (the shadow organisation) ensures that efficiency and productivity. By merely downsizing without an understanding of how the shadow network operates they saw a massive drop in their organisations efficiency to a far greater degree than should have occurred with the number of employees retrenched.

www.innovationagency.com | South Africa, Johannesburg

Shattered dreams and broken heats