A Decision Support System for Organisational Downsizing

  • Alexander Finlayson

Student thesis: Doctoral Thesis

Abstract

When adverse economic climates prevail, management of organisations may adopt a downsizing strategy in order to maintain liquidity. Such a strategy usually involves offering a severance package to those employees volunteering to leave the organisation, thus leading to a reduction in the workforce and consequent reduction in costs. Research has shown that invariably downsizing is introduced with little or no planning or analysis, often due to the perceived urgency to reduce costs. The implicit assumption made by management in neglecting such analysis is that the survivors of downsizing – those who retain their employment – will somehow manage the additional workloads imposed upon them. This has been found not to be the case and the vast majority of downsizing schemes fail to achieve management objectives. This research addresses such lack of analysis, indeed lack of management science application to downsizing strategies through the development of a decision support system that can be used to provide performance analyses of an organisation considering downsizing. Such analysis provides potential organisational throughput and related performance information that an organisation might expect following a planned downsizing. Due to the nature of the decision support system, effective decision support can also be provided for organisations considering an operational expansion strategy. The decision support system developed in this research takes the form of a generic queueing network simulation model which captures the operational processes of an organisation through the use of a graphical user interface. The decision support system is unique in two ways. First, the system operationalizes a specialised phase-type statistical distribution which is demonstrated through peer reviewed publication to provide extremely good approximations to empirical data distributions relating to operational process times. Second, the decision support system is developed using Microsoft Office applications and associated VBA code which offers extremely broad accessibility due to the preponderance of this software. The decision support system model has been utilised by an SME case study organisation, initially for consideration of a downsizing strategy but primarily for examination of their expansion strategy. The results from the decision support system developed in this research confirmed that the downsizing strategy would not be a viable option for the organisation and this strategy was abandoned. The decision support system results identified three constraining processes within the case organisation that would need to be addressed in the organisation’s expansion strategy. Recommendations derived from the decision support system results are in the process of being implemented by the case organisation.
Date of Award20 Jul 2018
LanguageEnglish
Awarding Institution
  • Teesside University Business School
SupervisorJohn Blenkinsopp (Supervisor) & Mark Davies (Supervisor)

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