Downsizing the firm: Answering the strategic questions

Academy of Management Executive

Volumn 10, Issue 2, 1996, Pages 38-45

  Bruton, Garry D ^a   Keels, J Kay ^b,c   Shook, Christopher L ^d  

^a UNIVERSITY OF TULSA   (United States)

^b EMORY UNIVERSITY   (United States)

^c EMORY UNIVERSITY   (United States)

^d Augustine for Health Sciences

Author keywords

[No Author keywords available]

Indexed keywords

EID: 0013070167     PISSN: 10795545     EISSN: None     Source Type: Journal    
DOI: 10.5465/ame.1996.9606161553     Document Type: Article

References (10)

1. M. Levison, "Thanks. You're fired," Newsweek, May 23, 1994, 48-49;
2. "Getting Sober about Those Intoxicating Job Numbers," Fortune, May 2. 1994;
3. for example, S. Pearlstein, "The Downsizing Trap," Washington Post National Edition, January 10-16, 1994, 8-9;
4. W. Roth, "The Dangerous Ploy of Downsizing," Business Forum, Fall 1993, 5-7;
5. R. Henkoff, "Getting Beyond Downsizing," Fortune, January 10, 1994, 58-64.
6. D.A. Heenan, "The Downside of Downsizing," Journal of Business Strategy, November-December, 1989, 18-23.
7. Wyatt Company survey cited in W.F. Cascio, "Downsizing: What Do We know? What Have We Learned?" Academy of Management Executive,7(1), 1993, 95-104.
8. J.R. Dorfman, "Stocks of Companies Announcing Layoffs Fire Up Investors, but Prices Often Wilt," Wall Street Journal, December 10, 1991, C1, C2.
9. Hoskisson and Johnson (Strategic Management Journal, 1992) found that restructuring was most likely to occur in firms classified as having related-linked (a category between related and unrelated) diversification. Their reasoning focused on inconsistency in control systems, an area that is the frequent target of restructuring. The apparent inconsistency between their findings and ours could be the result of differences in measurement and focus. We did not separate our sample into specific diversification types; they did not specify for particular forms of restructuring.
10. Hoskisson and Johnson (1992) examined the interaction among strategic change, diversification, and R&D intensity. In this research, they used ROA normalized by industry performance as a control variable. They found ROA is associated with both increases and decreases in R&D intensity. The difference hinged upon whether the firm increased or decreased its scope of diversification.