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When responsible downsizing strategy meets employee-oriented leadership: Implications for downsizing performance

Published online by Cambridge University Press:  21 May 2014

Philip Cheng-Fei Tsai  and
Chih-Ting Shih
Philip Cheng-Fei Tsai
Affiliation:
Department of International Business Administration, Wenzao Ursuline University of Languages, Taiwan, ROC
Chih-Ting Shih*
Affiliation:
Department of Business Administration, National Pingtung Institute of Commerce, Taiwan, ROC
*
Corresponding author. sctings@npic.edu.tw, sctings@yahoo.com.tw
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Abstract

This study examines whether a responsible downsizing strategy and employee-oriented leadership are complementary in strengthening firm performance after downsizing. This study investigated 154 firms that have used an organizational downsizing strategy with surveys and follow-up focus groups. Results of both the empirical evidence and qualitative data demonstrates that for firms adopting an employee-oriented leadership style, the level of responsible downsizing strategy is high and firm performance is significantly increased. Specifically, the results of the focus groups indicate that a responsible downsizing strategy deepens the loyalty and faith of employees to their employer. These theoretical and practical implications are also discussed.

Keywords

responsible downsizingleadership stylefirm performance
Type
Research Article
Information
Journal of Management & Organization , Volume 19 , Issue 5 , September 2013 , pp. 583 - 597
Copyright
Copyright © Cambridge University Press and Australian and New Zealand Academy of Management 2013 

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