The reality of downsizing survivor syndrome

This article sheds some light on the effect downsizing and retrenchments have on those not retrenched.

08 July 2020 | Business

Organisations need to take cognisance of the fact that the way they treat employees being laid-off sends a message to those left behind and to those who would like to join the organisation in future.

Lisa Matomola



The increasing news and media reports on companies who are downsizing and/or cutting jobs across Namibia are a startling reflection on the faltering Namibian economy, which through Covid-19 experienced another severe punch.

To try dealing with the impact, be competitive, efficient and sustainable through these trying times, organisations choose (or feel forced) to downsize and restructure their business models and processes.

But what about the people that are impacted through these measures?

This article will not address the psychological impact of those retrenched, but rather shed some light on the effect downsizing and retrenchments have on those not retrenched; those who were spared.

These employees are, more often than not, left with countless questions and concerns which may potentially negatively affect the organisation in particular where the people factor was not addressed with those remaining – the ones who are now supposed to continue driving the success of the company.

So, the question is, how should organisations manage survivors of downsizing?

At a first glimpse downsizing may look sustainable and favourable for organisations and the employees who were not retrenched may be labelled as “the lucky ones”.



Studies

When taking a closer look at the “survivors”, it however becomes clear that downsizing instils fears in these employees left behind. This is referred to as “downsizing survivor syndrome”.

Various studies have published findings on survivor syndrome.

The emotional strain downsizing has on survivors can be immense.The entire process or series of events, from losing co-workers to increased workload or additional responsibilities may all lead to direct physical and physiological effects.

This in turn may lead to absenteeism, decreased quality of work and/or decreased productivity.

Organisations should be alert of the potential reactions of the survivors, which could include expression of grief for those laid off, feelings of resentment and anger towards their employers. All of which may somewhat diminish trust between the employer and employees.

The aftermath of the downsizing also brings about the obvious fear of job security. Employees may continuously be faced with the fear that “they are next in line to leave” and with increased anxiety, motivation deteriorates and job satisfaction fades.



Immediate reactions

It is likely that when downsizing happens, survivors left behind are likely to work harder and employees will put in more effort and increase productivity. However, Applebaum et al (1997) argues that this is normally short-lived as employees do it to stay safe and to keep their jobs.

The negative factors that result due to downsizing can have a huge impact on the organisation if not addressed earlier and with urgency, preferable immediately following the retrenchments.



Dealing with s­urvivors

Susan Peppercorn (article from Harvard Business Review) advises leaders to exhibit care towards employees and to be willing to adapt and readjust in order to prioritise people over profits during this time.

Organisations need to alleviate any fears and provide assurance to employees to safeguard against the compromise of the trust relationship.

Several studies conducted by Bujang & Sani (2010) and Maertz et al (2010) all recommend that the organisation has a responsibility to communicate to those remaining on the next steps with regards to retrenchments and/or downsizing. Communication should be continuous to avoid major surprises and for employees to remain informed. “Over communication” should be the key message here.

Survivors of the downsizing also want to know how the organisation is taking care of those laid off, the support they are offering them and if possible, be included in this process.

For those employees taking on new responsibilities, support structures are required, and help availed where possible to ensure employees are equipped to perform their duties with minimal strain. Support from leadership and line managers will assist to motivate increased productivity and maintain overall well-being.



'Sending a message'

Organisations need to take cognisance of the fact that the way they treat employees being laid-off sends a message to those left behind and to those who would like to join the organisation in future.

Organisational reputation damage is likely, along with mounting trust issues for those remaining.

Therefore, proper communication should happen with the strategic direction of the organisation – during and well after the downsizing, to prevent as far as possible, the onset of downsizing survivor syndrome.

*Lisa Matomola is the manager: people & organisation at PwC Namibia. She wrote this article in collaboration with P&O consulting team Namibia.

Contact her at [email protected]

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