Monitoring and improving non-financial variables for sustaining performance of a learning organisation following downsizing

Abstract

In dynamic and turbulent markets, organisational restructuring is a necessary corporate process for companies to retain their competitive advantage. Unfortunately, global competitiveness pressures and economic downturn is causing companies to examine their cost structures and use employment downsizing as a management strategy for restructuring. If organisational downsizing may offer financial improvements in the short term, its profound personal and professional consequences on employees and negative impact on the dynamic and culture of the organisation are well known. Learning organisations strongly rely on the creativity and innovation of their knowledge workers to remain competitive, yet little consideration is placed on measuring the health of non-financial individual and organisational variables that influence knowledge worker's performance post downsizing and that are prone to reveal if the restructuring of the company will ensure "sustainable" performance. The research investigates the individual and organisational non-financial variables that post downsizing, are critical to evaluate and improve to ensure that the short term benefits obtained from restructuring the organisation are sustainable. The research is a case study of the research and technology division of a large South African industrial organisation that recently went through restructuring involving the layoff of personnel. From the research findings that identified critical variables impacting knowledge workers' creativity and innovation after restructuring as well as important interventions that would enable their job performance, a framework was developed to assist leaders in their change effort during and after restructuring. The objective of the framework is to enable and enhance the job performance of knowledge workers to sustain the performance of learning organisation in the future. The foundation of the framework is based on Kotter eight stage model and the combined Theory E (Economic value) & O (Organisation capability) change strategy. The framework draws links between Kotter's and Theory E&O change models and five key factors identified by knowledge workers to enable their performance at work after restructuring: (1) understanding the vision of the change, (2) ensuring relational and cognitive empowerment, (3) preserving the "innovation DNA", (4) having strong work ethics across the entire organisation and (5) developing systems and processes that are agile and efficient.