(PDF) Examining the Impact of Workforce Reduction on Surviving Employees in the Egyptian Organization

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Examining the Impact of Workforce Reduction on Surviving Employees in the

Egyptian Organization

Deena Saleh

1

Abstract

This present study aims at investigating the impact of downsizing on organizational

survivors in the Egyptian organization. It aims at unleashing the impact of procedural

justice on symptoms of survivor syndrome. It was hypothesized that higher levels of

perceived procedural justice lead to higher levels of organizational attachment, less

levels of voluntary turnover. To answer proposed research questions, a mix of

quantitative and qualitative methods was implemented to determine the impact of

procedural justice on symptoms of survivor syndrome. The results obtained from the

sample (N=101) survivors supported previous hypotheses and reflected the fact that

when survivors perceive layoffs to be unfairly implemented, they suffer from high

symptoms of survivor syndrome.

Keywords: Downsizing, Layoffs, Survivors, Survivor Syndrome, Job security,

Procedural Justice, Attachment, Voluntary Turnover, Absenteeism

1

Hacettepe University, Department of Economics, Ankara, Turkey. Orcid ID: 0000-0003-4628-4064

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

1 Introduction

Downsizing is a word which describes a widely implemented strategy by

most organizations nowadays. It evolved due to increased reliance on modern machines

and equipment rather than manual efforts by workforce. Global competition has become

such fierce that it became critical fact for some organizations whether in public or

private sectors to lay off their employees just to maintain their market share and

competitive advantages (Appelbaum et al, 1999a). Various definitions to downsizing

were proposed by different researchers at different time periods. However, all

definitions exhibit the simple fact that downsizing practices are widely implemented by

firms in both private and public sectors as the most formal restructuring effective

strategy which helps them realize higher profits, higher share prices, and maintain their

competitive position. This strategy is aiming at overcoming managerial difficulties, and

adapting to environmental shifts (Tsai et al, 2006). More detailed definitions are

presented and discussed below.

Cascio (1993) explained the word downsizing which refers to the previously

intended eradication of jobs and positions within organizations. He explained how jobs

include set of similar duties within meant positions like Programmers. That is why

downsizing is not about only eliminating employees; it might include elimination of

other functions, processes or hierarchical layers, or even whole systems or departmental

units within organization. While Budros (1999) emphasized the permanent nature of this

reduction in employee numbers with the conscious intention to achieve sought benefits

in terms of improved internal efficiency and effectiveness. Budros (1999) stated that the

core of downsizing process is the consciousness of those permanent reductions. He

further explained how efficiency is measurement of how organizations are able to

achieve their stated goals with best allocation of their resources (Budros, 1999).

Appelbaum et al (1997) stated that downsizing is a planned set of activities

undertaken by top management aiming at eliminating some jobs, realizing cost savings;

maintain smoother operational procedures business processes to improve its internal

efficiency and effectiveness. An example of IBM which illustrates those competitive

aspects was mentioned by Beylerian and Kleiner (2003) who viewed IBM’s full

employment strategy in the early 1980s with no layoffs for about forty years no single

employee was laid off although it employed about 405,000 employees. When IBM

began to face strict competition from new competitors like Apple and Microsoft, it had

to downsize to survive within this changing environment. This example shows how

downsizing is a critical strategy for firms in the whole industrial world to survive, and a

necessary response to rapidly changing environment. It was mentioned that downsizing

is a result of new economy which revolutionized the workplace not only in US firms but

in the whole world (Beylerian and Kleiner, 2003).

From the above-mentioned definitions, it might be thought that downsizing is

simply about restructuring organizations. However, the term restructuring is about

fundamental and radical changes in the whole organization; its strategy, employees, and

processes, so it is a broader term. Downsizing is a strategy used by organizations which

aim at designing smoother business processes, less costs to achieve efficiency as stated

by Carbery and Garavan (2005). The difference between organizational restructuring

and downsizing was highlighted by Budros (1999) who tried to omit the belief that both

terms were synonymous; he mentioned that organization’s structure is about how

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

individuals are distributed within their unique positions and how they have various roles

and interactions carried on. This means that organizational structure as a term refers to

formal hierarchies inside organizations, so restructuring indicates changes in

hierarchical layers and redistributing units, divisions and ways tasks are organized,

while downsizing is about reduction in entire size of the organization, whether this

reduction is achieved by laying-off employees or functions. Both actions could have

some ties, but it is important to differentiate between resulted outcomes, whether they

are alternation of processes and structures or contraction in size and number of

employees (Budros, 1999).

Downsizing is a controversial matter which received much attention over the years

(Beylerian and Kleiner, 2003). Some researchers believe that layoffs are the sole

response to meet rapidly changing competitive environment. For example: Appelbaum

et al, 1999a believed that downsizing is mainly implemented due to its sought financial

and economic benefits which are cost savings, elimination of extra hierarchal positions

which is believed to increase productivity, improve efficiency and effectiveness, and

enhance the firm’s market value (Appelbaum et al, 1999a). On the other hand, layoffs

are seen as only strategies which are taken by heartless strict executives who just do not

care about their employees as downsizing is not the ultimate means to reduce costs; it

might incur costs much higher than its desired returns due to replacement incurred

expenses and severance packages like Nynex which incurred about 3 billion dollars in

terms of severance packages payments, so the targeted costs reductions desired were

met by only less than half of firms which implemented downsizing as a cost reduction

strategy (McKinley et al, 1995). It was further stated that expected contributions of

downsizing to improving productivity are limited; as when firms lay off their

employees, they lose firm-specific skills of these employees which negatively affect the

firm’s productivity. That is why about only 22% of companies which downsized have

realized improvements in their post-downsizing productivity (McKinley et al, 1995).

When downsizing is mentioned, it is important to consider two types of employees,

those laid-off who are called victims, and those remaining employed who are called

survivors. It is important to consider human aspects related to downsizing process due

to its impact on both victims and survivors within the organization. However, it is

relatively more important to focus on surviving employees who remain within the

organization and help it operate and reach its intended goals. The effects of layoffs on

survivors are various; they can be either as a sense of appreciation among survivors who

feel grateful as they maintained their secured jobs, or those as a sense of increased

stress, and increased workload (Levitt et al, 2008). Many previous studies illustrated

how downsizing negatively affects surviving employees within organizations through

reducing their commitment, loyalty, and attachment to management. Those survivors

carefully detect how management treats other laid off workers, then based upon the

perception whether victims were compensated or not, survivors shape their reactions

and post-downsizing behaviors (McKinley et al, 1995). Some factors are affecting the

degree to which negative responses are exhibited by survivors like procedural justice,

distributive justice, clear communication, trustworthiness in management, and employee

empowerment (Spreitzer and Mishra, 2002; Clay-Warner et al, 2005; Thornhill et al,

1996). However, perceived justice whether procedural or distributive has major impact

on post-layoff responses according to the justice theory, the main difference between

procedural and distributive justice lies in which employees are affected by the lay-off;

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

as procedural justices is major predictor of post-layoff responses among survivors,

while distributive justice predicts responses among downsizing victims (Sahdev, 2004).

According to this anticipated strong link between downsizing and survivors who are

affecting overall organizational performance after layoffs; the purpose of the thesis is to

identify the impact of downsizing practices on survivors within Egyptian organizations.

The specification of Egyptian organizations in this study is based upon two main

reasons:

First, Egypt is a developing country which has slow rates of economic growth and

high rates of economic recession and inflation. And according to the literature on

downsizing, if a certain region or country is facing economic recession, downsizing

becomes the perfect strategy sought to survive within the declining economy (Selmer

and Waldstrom, 2009). This aspect was further explained by Appelbaum et al (1997)

who illustrated how the planned decision to lay off employees is taken with the

intention of realizing costs reductions through jobs which are eliminated and

maintaining internal efficiency through better utilizing available limited resources

(Appelbaum et al, 1997). Firms which face financial problems during economic

downturns aim to avoid undesirable conditions by dismissing their employees (Said et

al, 2007). Second, Egypt has lately witnessed many major changes on social, political,

and economic levels; these changes were driven by the 25th January revolution in 2011.

The political instability in the country forced some companies both foreign and local to

shut down their operating units and dismiss some employees. Therefore, based on these

reasons, Egypt is nominated to be in need for such type of studies due to the importance

of the downsizing issue currently in Egyptian labor market, and the need to consider the

human factor in more careful ways. Moreover, the importance of studying such effects

on those survivors is due to the fact that survivors are a factor that determines the

efficiency and effectiveness of the organization’s performance on the long run after it

implements downsizing; they are supposed to hold new responsibilities and therefore

they need enhanced skills to meet these new tasks (Carbery and Garavan, 2005).

2 Literature Review

As mentioned in the introduction, downsizing has various definitions indicating similar

aspects; it refers to shrinking staff and personnel size within some organizations aiming

at improving their organizational performance. These organizations can also cut off

other resources like capital and assets to better adapt to faced opportunities and

available resources (Dewitt, 1993). Freeman and Cameron (1993) suggested another

definition to downsizing which is considered as means followed by management to

realize productivity increase and maintain their organization’s competitive position. It is

viewed as a strategy affecting the whole organization. Other terms were used to describe

downsizing like redundancy, re-organization, rationalization, revitalization, and

rightsizing (Tsai and Yen 2008; Petzall et al 2000). Said et al (2007) believed that

downsizing in today’s new economy has become a custom which is implemented by

firms which face financial problems or aim at improving their levels of internal

efficiency and effectiveness. This modern view is not the same as traditional view on

downsizing which was a solution which is taken by firms that were threatened by

undesirable conditions (Said et al, 2007). McKinley et al (1995) stated that more than

eighty five percent of American Firms undertook downsizing practices for their white-

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

collar employees between 1987 and 1991, while in 1993 more than 350,000 workers

were laid off.

Another important aspect to consider when studying the literature on downsizing;

sometimes both organizational downsizing and organizational decline are considered as

synonyms. That is why McKinley et al (2000) explained the difference between

organizational decline and downsizing, and how each has different reasons;

organizational decline is caused by factors that are not controllable by management such

as environmental changes which weaken and reduce the company’s resources, while

downsizing is an intentional planned for actions taken by management which cuts off its

personnel (McKinley et al, 2000). Furthermore, there are some symptoms that indicate

organizational decline were further discussed by Freeman and Cameron (1993) who

stated that these reasons were the inability of management to adapt to environmental

changes, less available budgets, and increased competition with other organization.

Moreover, decline might not entail personnel layoffs; as it is more likely to negatively

affect organizational performance and efficiency, so firms might keep their employees.

It means that the practice of dismissing employees sometimes is a result of

organizational decline (Freeman and Cameron, 1993).

Greenhalgh et al (1988) had another perspective at this assumed relation between

organizational decline and downsizing activities; they assumed that downsizing is a

strategy to face organizational decline especially when it is a matter related to rare

resources which force organizations to narrow their operational scope by laying-off

their workers and employees with the goal of maintaining their market position and

provided services and products. These lay-offs entail many tangible costs related to

insurance payments, and monetary support for out-placed workers along with other

intangible costs related to job insecurity and adverse reactions which might be exhibited

by surviving employees who lost their trust in management (Greenhalgh et al, 1988).

Some key attributes describing main characteristics of downsizing were mentioned by

(Freeman and Cameron, 1993; Appelbaum et al, 1999c) who mentioned that

downsizing is an intended planned for decision made by management, it is mainly about

layoffs whether they were conducted through voluntary retirement programs or

obligatory transfers. These actions can affect single departments or the whole entire

organization. Moreover, they aim at improving performance and efficiency (Freeman

and Cameron, 1993; Appelbaum et al, 1999c).

2.1 Factors affecting Downsizing

Downsizing as a phenomenon is attributed to various factors. These factors were

explained by many researchers like (Budros, 1999; Carbery and Garavan, 2005; Dewitt,

1993) who had many perspectives on reasons which forced companied to dismiss their

employees. More detailed review of these factors is presented below:

Some authors believed that technological advancements and new innovations were

the driving factors causing downsizing to occur; Budros (1999) perceived downsizing as

a form of organizational innovation which refers to new internally integrated systems,

policies, or programs which can be procured or created within the organization which

firstly implement them. As downsizing includes radical changes in organizational

structures and hierarchical processes, so it could be considered an innovation system. It

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

is a strategy adopted by many firms which believe it is the best way to improve their

productivity, efficiency, profitability and productivity (Budros, 1999; Carbery and

Garavan, 2005). The same aspect was mentioned by Appelbaum et al 1999a who stated

that technological advancement and innovations are major factors which affect firms’

tendency to cut off its personnel due to increased global competition. However, the

impact of technological advancements and organizational innovation nowadays is

different from how it was years ago. Years ago, technology led to increased tendency to

hire new workers, but nowadays it leads to laying-off employees. This contradiction is

not driven by the technology developed but is rather driven by the fact that some tasks

which were previously done by employees who used to gather, analyze, and share

information are now done mainly by new communication technological means,

therefore those workers are no longer needed (Appelbaum et al, 1999a).

Meanwhile, Cross and Travaglione (2004) stated that “Downsizing has become one

of inevitable outcomes of operating in a global fierce economy where continuous

adjustments to products, services, and labor prices are needed to maintain current

existing competitive advantage by companies which have the desire to survive in a

changing business environment, adapt to up-to- date technologies, and realize

economies of scale. They stated that neither organizational decline nor declining profits

were only driving factors for downsizing. It was mentioned that organizations try to

meet environmental conditions through outsourcing, temporary workforce employed,

mergers and acquisitions, business process reengineering. These factors increased the

reputation of downsizing as a strategic action (Cross and Travaglione, 2004; Dewitt,

1993; Tsai and Yen, 2008).

While Band and Tustin (1995) believed that downsizing represents solely an aspect

of the overall implemented strategy to realize two major ends which are the long run

market repositioning of the company and raising the productivity of employees

individually (Band and Tustin, 1995). These claims were emphasized by Tzafrir et al

(2006) who stated that recession was the major factor driving downsizing systematic set

of activities which take a more defensive and reactive nature when downsizing is caused

by financial problems which affect both internal system and external environment of the

organization (Tzafrir et al, 2006). Moreover, this overall implemented strategy was

further explained by Budros (2002) who mentioned that there are two factors which

affect the firm’s choice of certain downsizing strategy. The first factor is the degree of

employees’ protection within their firm; if employees are forced to leave through

involuntary downsizing, they are less protected due to less control they hold towards

their economic job well-being. While if their firms implement voluntary non-lay off

strategies, survivors are well-protected due to possessed control over their job

continuity. The other factor is the degree of importance of short-term savings in costs.

The involuntary downsizing helps the firm realize high cost savings as the firm does not

pay its laid off employees leave payments, while relatively low-cost savings derive from

voluntary downsizing due to long time and high monetary payments made for

employees’ retirement programs (Budros, 2002).

2.2 Approaches to Downsizing

The word approach was defined by Thornhill and Saunders (1998) as the way and

shape of the change process implemented by the firm (Thornhill and Saunders, 1998).

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Two famous downsizing approaches which are: the reorientation and convergence

approaches were mentioned by Sahdev (2004) who stated that they represent two

contexts within which downsizing can occur. He stated that top management during

reorientation periods attempts to consider all forces affecting its fundamental change

like technological, competitive, and institutional external factors. While during

convergence periods top management focuses on implementing continuous

improvement programs and incremental changes (Sahdev, 2004).

2.2.1 Downsizing as Reorientation

According to Freeman (1994), downsizing is reorientation tool if firms react to its

past incurred faulty steps or proactively and strategically adapt. At this case it is

appropriate for the firm to redesign its processes, purpose, and structure. This can be

done by top management which assesses the firm’s existing constraints, design, and

human resources management practices. Freeman (1994) highlighted the fact that if the

firm is undertaking downsizing on a large scale, it is an indicator of the past

misalignment at this firm. Yet, this misalignment can still be addressed by reorientation

approach to the firm (Freeman, 1994). Meanwhile, reorientation approach to

downsizing is implemented by firms which attempt to match their internal capabilities

and external environment to improve their competitive position (Appelbaum et al,

1999a). It is a short-term approach as indicated by Thornhill and Saunders (1998) who

stated it is not easily implemented as firms need to ensure that changes include the

whole organization which needs to be altered and redesigned (Thornhill and Saunders,

1998). Moreover, Appelbaum et al (1999a) explained that firms implement the

reorientation approach through enhancing their existing mission after evaluating their

structures. The major concern for this approach is improving the firm’s position and

efficiency; therefore, layoffs are not randomly conducted, but the firm selectively

decides whom to be dismissed after conducting analyses involving all departmental

levels, tasks, proposals are made about the new suggested design which must be known

by all employees, firms abide by certain guidelines during this process, and they also

consider their external relations with other firms (Appelbaum et al, 1999a).

2.2.2 Downsizing as Convergence

Freeman (1994) stated that the convergence approach does not entail radical

changes but rather is done through downsizing which is considered a critical strategy

incorporated into the firm’s goal of continuous improvement in its future efficiency.

This can be achieved when all members inside the organization believe that

improvement is always needed, and operations can be simplified. Therefore, all

members are held responsible for downsizing, all tasks and positions are subject to

possible replacement due to goals of simplifying tasks and reducing workload

(Freeman, 1994). Years later, Thornhill and Saunders (1998) defined the convergence

approach to downsizing as an approach implemented by firms willing to improve their

efficiency and operational quality by adopting some incremental changes in their

processes (Thornhill and Saunders, 1998). These changes are not fundamental but as

explained by Appelbaum et al (1999a), these changes aim at continuously improving

internal efficiency and performance through commitment to specific time frame before

engaging in downsizing actual practices by allowing participation and involvement of

all employees and managers who cooperate, suggest proposed improvements and

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

strategies to maintain their firm’s market position, and realize smoother operational

procedures (Appelbaum et al, 1999a).

2.3 Implementation Strategies

The three main downsizing strategies are workforce reduction, organizational

redesign, and systematic strategies. The term strategy was defined by Tsai and Yen

(2008) who referred to it as ‘‘Set of undertaken activities, procedures, policies and

processes which consequentially and strategically affect the firm’’. This strategy could

be planned or emergent due to its ideational and behavioral perspectives (Tsai and Yen,

2008).

These three strategies are independent; a firm can implement one or more of them

according to its conditions. However, the firm should scan its internal capabilities and

external environment, define its mission and sources of competitive strength, select the

suitable downsizing approach that suits it from above two mentioned approaches, and

decide the implemented downsizing strategy (Appelbaum et al, 1999a). Tsai and Yen

(2008) stated that the chosen downsizing strategy depends on the degree of change

desired by the firm, and that organizations usually implement two or more strategies

when undertaking downsizing either simultaneously or sequentially. For example, some

firms might begin with personnel reductions then follow it by a redesigning process for

the whole organization (Tsai and Yen, 2008).

2.3.1 Workforce Reduction

Workforce reduction is considered the most common downsizing strategy. The

most well-known tactics for workforce reduction are push and pull strategies

(Appelbaum et al, 2003). The same tactics were mentioned by Budros (2002) but with

different terms; voluntary turnover referred to pull strategy, and involuntary turnover

referred to push strategy (Budros, 2002; Appelbaum et al, 2003). Voluntary turnover/

pull strategy occurs when employees voluntarily quit their jobs, it means there are no

economic pressures, but the social frame poses this action which occurs through

offering some early retirement programs, and attrition opportunities, employees

sometimes prefer voluntary turnover because it does not have those negative effects

associated with involuntary lay-offs. On the other hand, involuntary turnover/ push

strategy is about directly laying off employees because of their poor abilities or being

faced by some pressures related to economic or social matters, these pressures make it

more likely for the firm to engage in involuntary downsizing which is usually achieved

through personnel layoffs, these companies are willing to maintain and keep their

competitiveness in the market or realize cost reductions (Budros, 2002; Appelbaum et

al, 2003).

Although work reduction strategies have some sought benefits like higher

flexibility, and open communications, they are short term benefits related daily

operations which might realize some cost savings. Firms which lay off their employees

expect high cost savings due to large reduced portion of operating fixed costs like

compensation and payroll expenses. Yet, some long-term negative effects exist;

employees are threatened, unable to predict coming layoffs, and lose their trust and

belief in management. The appropriate downsizing decision should consider careful

evaluation of individual employees’ performance and dismissing those employees who

do not add or create value to their firms (Appelbaum et al, 1999a; Said et al, 2007).

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

2.3.2 Organization Work Redesign

Organization work redesign is a medium-term strategy with some sought benefits

which can be realized if a full analysis for all departments, divisions, and tasks was

performed to properly reach the desired design (Makawatsakul and Kleiner, 2003).

Firms redesign their processes, procedures, and achieve flatter hierarchies through

coordinating their departments and removing all extra uncritical divisions to improve

operational efficiency and effectiveness. This simplifies work structure within the firm

(Appelbaum et al, 1999). Another common term describing a firm reorganizing its

activities, structures, and implementing dramatic internal changes is organizational

restructuring (Appelbaum et al, 1999c). The changes undertaken by management are

aiming at increasing efficiency and effectiveness of the organization through improving

its competitiveness and production (Appelbaum et al, 1999c).

2.3.3 Systematic Strategies

Systematic strategies are about simplifying the whole organization; its production

processes, and its relations with suppliers. This strategy helps firms realize their desired

benefits in terms of improved procedures and efficiency through eliminating

redundancy within the firm (Appelbaum et al, 1999a). The organizational system is

divided into internal and external operating systems through redesigning processes and

procedures; the internal side is about employees and internal operation, while the

external side is related to supply chain and the firm’s external relations (Makawatsakul

and Kleiner, 2003). It was mentioned by Appelbaum et al (2003) that the aim of this

strategy is to create a new organizational culture including its employees’ values and

norms, integrating the firm as a whole system. The systematic strategies discussed

above are similar to those mentioned by Nair (2008) who stated that organizations can

adapt to environmental changes by either proactive or reactive strategy. Proactive

strategy occurs when the firm is restructured with the aim of increasing its efficiency,

while reactive strategy occurs when the firm maintains its survival by obtaining

resources preventing its bankruptcy (Nair, 2008).

2.4 Theoretical Perspectives on Downsizing

Appelbaum et al (1999a) stated that there are three main perspectives concerning

downsizing which are global (industry), organization, and individual level. Macro broad

issues like mergers and acquisitions, global employment trends are addressed by

industry level, while organization level is concerned with evaluation of benefits and

disadvantages of downsizing strategies implemented, and finally the individual level is

about employees’ psychological status (Appelbaum et al, 1999a). However, the main

three perspectives on downsizing according to McKinley et al (2000) were the

economic, institutional, and socio-cognitive perspectives (McKinley et al, 2000).

According to Tsai et al (2006), these theoretical perspectives of McKinley and

associates (2002) are meaningful as they explicitly explain three major driving factors

for downsizing and provide better understanding of downsizing by people. Although

there is no empirical research confirmed their absolute validity, they remain the most

commonly used perspectives explaining downsizing (Tsai et al, 2006).

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Tsai and Yen (2008) confirmed that the three perspectives; economic, institutional,

and socio-cognitive have resulted from the socio-cognitive process by which managers

agree on downsizing as a desirable effective strategy to be implemented regardless

conditions, status and concepts of their various organizations. They explained that social

forces affect management decisions towards downsizing which was considered a

legitimate institutional norm, and that is why institutionalization was considered an

important driving factor for downsizing. These social and institutional factors are

external irrational, while some internal irrational factors like the organization’s culture

and leadership traits were other factors affecting downsizing. Furthermore, it was stated

that those strategies could have various levels among which firms could choose, these

levels could range from involuntary or voluntary redeployments, layoffs whether

accompanied with placement assistance payments or without, and the firm selects the

level according to its background aspects and redundancy characteristics (Tsai and Yen,

2008).

2.4.1 Economic Perspective

McKinley et al (2000) stated that the economic perspective is concerned with

ways how downsizing occurs, as it is considered a device influencing companies’

financial performance. It assumes that decision makers are aware of the relation

between financial performance in their firms and potential downsizing practices. That is

why they believe economic conditions like operational efficiency; increased

productivity are main motivations to have future layoffs. Therefore, they believe

downsizing is the solution to face organizational decline phenomena which was

previously discussed. Nowadays downsizing is implemented by various firms which are

willing to increase their productivity although they do not face decline (McKinley et al,

2000). Few years later, Nair (2008) stated that the economic perspective is most

commonly used by organizations which aim at improved future financial performance

and increased productivity through reduction in operational expenditures. He mentioned

that this pure economic perspective of downsizing does not consider costs associated

with negative human aspect of the process. At the same time, it was mentioned that

non-economic forces make it necessary for organizations to downsize. These non-

economic forces like management beliefs and practices; if managers prefer flatter

organizational structure and less hierarchical layers, they are more likely to undertake

downsizing and laying off some middle managers (Nair, 2008).

2.4.2 Institutional Perspective

McKinley et al (1995) defined institutional rules as set of norms, expectations

commonly held and shared by individuals whether in a society or an industrial sector.

These rules determine how various organizations are structured and designed, how their

managerial processes and procedures are undertaken. They gave an example of such

rules which is the Human Resources Management Department which should be present

in all large corporations (McKinley et al, 1995). In year 2000, McKinley et al (2000)

further completed their studies on the three perspectives on downsizing; they stated that

due to lack of clear evidence supporting claims of economic perspectives about the

positive relationship between downsizing and the financial performance of the

organization; institutional perspective appeared to complement the economic one. This

institutional perspective assumed that both non-economic and economic factors drive

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

downsizing. Downsizing is a concept referring to effectively managing the organization

along with maintaining social acceptance. It goes along with cloning as a driving factor

to downsizing, as both assume that downsizing is driven by some external social factors

or market competitiveness requirements (McKinley et al, 2000). Furthermore; Tsai et

al (2006) stated there are some items which should be included within the institutional

theory of downsizing. These items are the motivating factors to downsizing whether

they are socio-cognitive, economic, or institutional ones, they can be considered

whether individually or jointly, and that post-industrial western countries are more

likely to consider those three factors (Tsai et al, 2006).

According to institutional theory; economic and technical factors have little effect

on institutional rules within organizations, they are only traditional elements to which

firms react and conform. Three major social forces leading organizations to adopt

institutional rules were defined, these factors are: constraining, cloning, and learning

(Tsai et al, 2006). Two years later, Tsai and Yen (2008) further added that cloning,

constraining, and learning were external institutional factors, and that organizations

engage in downsizing activities in response to these three external factors despite their

awareness that their anticipated benefits might not be realized (Tsai and Yen, 2008).

McKinley et al (1995) elaborated that institutional theory of downsizing specified these

three factors of cloning, constraining, and learning through emphasizing the critical role

played by institutional rules and laws in shaping processes and structures within

organizations (McKinley et al, 1995).

• Constraining

Constraining was defined as the institutional rules and legitimate structures to

which firms conform in their activities (Appelbaum et al, 1999a). This definition was

also supported by McKinley et al (1995) who mentioned that these institutional rules

are the determining factor to shapes on management structures and activities in their

legitimate content. Moreover; Tsai and Yen (2008) stated that constraining occurs when

top management makes the decision to downsize (Tsai and Yen, 2008).

• Cloning

Cloning refers to imitation of some companies to other big ones which activities

represent a benchmark in their excellence in the market; it is like a strategy of following

market leaders (Appelbaum et al, 1999a). Cloning was defined by Tsai and Yen (2008)

as an imitation process is implemented by the organization. While McKinley et al

(1995) stated that some firms play roles of imitators to other major prestigious firms in

the same industry sector as an attempt to face uncertainty caused by global fierce

competition (McKinley et al, 1995).

• Learning

Learning refers to educational institutions which discuss downsizing approaches

and strategies (Appelbaum et al, 1999a). According to Tsai and Yen (2008), learning

occurs through education and MBA courses (Tsai and Yen, 2008). These basic MBA

courses and taught subjects are management practices and principles presented and

taught in worldwide universities by professionals as indicated by McKinley et al (1995).

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

2.4.3 Socio-cognitive Perspective

McKinley et al (2000) had mentioned that the socio-cognitive perspective could

explain the roots upon which the institutional perspective of downsizing was based at

micro-levels (McKinley et al, 2000). Few years later, Tsai et al (2006) explained that

psychological aspects could also shape downsizing decisions according to the socio-

cognitive viewpoint. So downsizing is a legitimate ethical practice because of social

interactions and societal cultures which help managers build their mind sets which view

downsizing as this legitimate strategy to respond to dynamic environment (Tsai et al,

2006).

2.5 Overview of Survivors in the Organization

Downsizing is considered a strategy to adjust to structural and fundamental changes

in global economic environment. Companies which are implementing workforce

reduction strategies should consider their employees whether the laid off or those

remaining in employment. Employees who survive a layoff are called ‘‘Survivors’’.

They exhibit many negative post-layoff behaviors and feelings like stress, declining

morale. However, the strength and shape of these behaviors and feelings depend on

some factors which shape survivors’ responses (Mishra and Spreitzer, 1998).

Although success or failure of downsizing is highly linked to the degree to which

survivors accept and adjust themselves to it, management may ignore effects that

downsizing may have on surviving employees who can lead to declining

organizational performance on the long run as stated by (Kinnie et al, 1998;

Thornhill and Saunders, 1998).

Nair (2008) stated that attitudes and behaviors of survivors are negatively affected

by layoffs which create more stress, workload, less morale, commitment, trust in

management, violation of psychological contract, depression. He further stated that

management can avoid these negative reactions by clearly explaining and informing

employees of its motivations to downsize. If employees believe there were clear honest

communications between them and management, they are less likely to exhibit these

negative reactions, and they are likely to engage in more speed and effective efforts to

rebuild their organization (Nair, 2008).

2.5.1 Types of survivors

Some elements were discussed by Beylerian and Kleiner (2003) who stated

that survivors respond and exhibit some negative emotions according to the legitimacy

of layoffs; whether laid off workers were notified prior to these layoffs, whether the

decision was made according to a clear criterion like seniority, the degree of fairness in

applied procedures, and whether they were fairly implemented. When survivors

perceive inadequate implementation of above-mentioned items, they will exhibit less

morale, commitment, attachment to management (Beylerian and Kleiner, 2003). Same

aspects were discussed by Mishra and Spreitzer (1998) who confirmed that survivors

react in various ways to downsizing because of various characteristics which

differentiated between four types of organizational survivors. These types are

constructive, destructive, active, and passive survivors. This classification is based on

two dimensions; survivors might react passively or actively, and they can be either

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

destructive or constructive (Mishra and Spreitzer, 1998). The type of survivor is

affected by the appraisal phase he/she is involved in while interpreting downsizing

process. Survivors engage in two appraisal phases to shape their concept of downsizing.

There is the primary appraisal phase, where survivors are affected by level of their trust

in management, its competence, and perceived justice in its implementation procedures.

This controls the degree to which downsizing is seen as a threat to survivors. That is

why survivors exhibit cooperative and constructive responses, otherwise they will

respond in destructive ways. While when survivors engage in secondary appraisal

process, they think about their capability in coping with changes incurred by this

downsizing. This is affected by degree of employee empowerment, sense of self-

control, and concept of work redesign; it’s perceived intrinsic changes. That is why

survivors exhibit active responses to downsizing if they are empowered and intrinsically

satisfied with new changes introduced, otherwise they will respond in passive way

(Mishra and Spreitzer, 1998).

Constructive versus Destructive Survivors

Constructive survivors believe that downsizing poses no harm for their job security.

That is why they exert more effort to help management implementing it; they exhibit

hopeful obliging responses to layoffs which represent no harm to them. Unlike

destructive survivors who believe downsizing is such a great threat to their jobs, and

accordingly they are not willing to support management or accept its explanations of

undertaken layoffs; they exhibit cynical and fearful feelings towards downsizing which

negatively affects them (Mishra and Spreitzer, 1998).

Active versus Passive Survivors

Active survivors tend to face the actual situation and deal with the problem. That is why

they believe they can adapt to downsizing. They hold hopeful future views for their

firm. While passive survivors ignore the problem; they heavily rely on management in

solving the situation. This is because of their fear which makes them act as if they have

no capability to deal with layoffs, so their response is fearful and obliging (Mishra and

Spreitzer, 1998).

2.6 Overview of Survivors’ Responses

Thornhill et al (1997; 1998) mentioned two types of responses exhibited by

survivors in organizations and elaborated that these responses are based upon degree of

justice perceived by survivors which shape their behaviors towards layoff victims.

These responses can be sympathetic or unsympathetic. Sympathetic reaction is

exhibited when survivors believe that management conducted downsizing in an unfair

way towards laid-off employees, so they begin to hold negative emotions and attitudes

towards their organization. While unsympathetic reaction is exhibited when survivors

believe management had proper justification for dismissing selected employees, so they

consider it a justifiable action and that is why those survivors continue working hard

(Thornhill et al, 1997;1998).

Thornhill et al (1996; 1997) further elaborated that Survivors’ responses are like a

continuum whose two edges represent either favorable or unfavorable ones, so it is

possible for survivors to hold mix of those reactions. But this depends on some factors

which are considered moderating variables affecting sympathetic negative responses of

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

survivors. The sympathetic responses depend on the degree of relational closeness

between survivors and those laid-off employees, the degree of interdependence in

common tasks they used to perform together, how common were norms and values that

both survivors and victims are sharing and holding, the degree those survivors believe

they are a subject to being laid-off or degree of job-insecurity perceived by survivors

due to previous experience they hold towards downsizing, the perceived fairness of

procedures taken by management while implementing the layoffs, the expectations

which employees have towards layoffs to take place within their organization, and

finally the external environmental factors like the potentiality to find another job

(Thornhill et al, 1996; 1997).

Thornhill et al (1996; 1997) illustrated that sympathetic reactions can be either

attitudinal or behavioral. Attitudinal reactions take the forms of anger, distrust, less

motivation, low morale and commitment towards their organizations, they used an

example of Chell British Company which downsized in early 1980s, it undertook some

surveys of 83 managers, and found that surviving employees clearly exhibited those

sympathetic reactions along with low rates of unsympathetic reactions. While

behavioral reactions relate to the degree to which employees still prefer risk taking, the

extent to which they become cautious, rates of absenteeism and voluntary turnover, and

the impacts on productivity, profits realized (Thornhill et al, 1996; 1997).

2.6.1 Archetypes of Survivor’s Response to Workforce Reduction

Appelbaum et al (1997) indicated that one factor that influences survivors’

response is the way they perceive downsizing to have been fairly conducted. In case

of perceiving it to be unfair, they would feel guilt towards their laid-off colleagues. If

they concluded that performance was not the judge for being dismissed or to remain

employed, this would lead them to ignore their performance and perform under their

capabilities (Appelbaum et al, 1997).

As indicated above, responses of survivors to downsizing vary among them; some

see it as an opportunity for personal growth and career development, which encourages

them to exert more effort in their work, while others exert less effort, or may exert the

same effort. These responses depend on the type of survivors. Therefore, below are the

four archetypes of survivors’ response to downsizing which have cognitive, behavioral,

and affective components. Survivors may also have hybrid responses rather than

extremes on the mentioned dimensions. For example, some responses may be cynical

and hopeful, where survivors try to be critical with the organization through creating

better working conditions (Mishra and Spreitzer, 1998).

Fearful Response ‘‘Walking Wounded’’

Mishra and Spreitzer (1998) described these survivors as both destructive

and passive; they exhibit a fearful response. They are called the walking wounded

because they strongly believe that downsizing represents severe harm to them; they

suffer from anxiety, stress, fear, and depression, lose their interest in work, so they

ignore it and tend to perform other non-work-related tasks due to lost concentration.

These negative behaviors are accompanied with late arrivals, less loyalty, increased

absenteeism and withdrawal from responsibility (Mishra and Spreitzer, 1998). Some

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

negative emotions survivors feel was further explained by Petzall et al (2000) like

increased stress, less loyalty, loss of job security sense, increased fear is due to the

fearful response exhibited by these survivors (Petzall et al, 2000).

Obliging Response ‘‘Faithful Followers’’

Obliging response which is exhibited by faithful followers was explained by

Mishra and Spreitzer (1998) who stated that it is more likely to be exhibited by

constructive but passive survivors who hold no belief they can personally catch up with

downsizing. Meanwhile, downsizing is not a severe threatening danger to them. They

believe it will not prevent them from performing their expected tasks well. These

survivors are loyal, committed, with strong sense of recognition to their organizations to

which they conform and carry out its orders without hesitation (Mishra and Spreitzer,

1998).

Cyclical Response ‘‘Carping Critics’’

Cyclical response exhibited by survivors who are carping critics is similar to

this discussed above response of fearful survivors; as both believe that downsizing is

highly harmful to them, but they are active in their response to downsizing; they

actively interfere and discuss issues with management during downsizing

implementation process. Moreover, their response to downsizing has a destructive

nature because they believe they can cope with it but without any attempts to

embracing it; they suffer from aversion, bitterness, and anger which make them in

continuous willingness to challenge management decisions (Mishra and Spreitzer,

1998).

Hopeful Response ‘‘Active Advocates’’

According to Petzall et al (2000), a positive attitude reflects hopeful response

exhibited by survivors who are active advocates, this response results from a sense of

enthusiasm and excitement held by survivors who might be willing to work harder and

be active actors (Petzall et al, 2000). Moreover, Mishra and Spreitzer (1998) had earlier

explained that these responses are exhibited by active and constructive survivors who

believe that downsizing is not a source of harm for them; they are similar to cyclical

archetype as both believe they can personally adapt to do layoffs. The main difference is

that cyclical survivors exert no efforts to embrace the implemented process, so they

continuously attack management. While the hopeful survivors are optimistic about their

organization’s future that’s why they are committed to it. Their responses are also called

‘‘Good Citizenship Behavior’’ and ‘‘Job Involvement’’ (Mishra and Spreitzer, 1998).

Figure 1: represents a brief summary for archetypes of survivor’s responses (Mishra and

Spreitzer, 1998).

Constructive

Obliging Response Hopeful Response

Calm, relief hope, excitement

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Commitment, loyal optimism, solving problems

Following orders, routine behavior taking initiatives

‘‘faithful followers’’ ‘‘active advocates’’

Passive Active

Fearful Response Cynical Response

Worry, fear anger, disgust

Anxiety, helplessness moral outrage, cynicism

Withdrawing, procrastinating bad mouthing, retaliating

‘‘walking wounded’’ ‘‘carping critics’’

Destructive

Figure 1: Archetypes of Survivor Response

Source: (Mishra and Spreitzer, 1998)

2.7 Factors affecting Survivors’ Response

There are some factors which affect survivors’ responses like Justice, trustworthiness

to management, when survivors have trust in management actions and intentions, they

are less suspicious and feel more attached to the organization as they perceive

downsizing as legitimate action which posits no threat to their job security, so when

they perceive top management as honest and competent in its strategic decisions, they

will believe its promises and intentions (Spreitzer and Mishra, 2002).

Mishra and Spreitzer (1998) explained the two types of cognitive appraisal through

which individuals cope and respond differently to certain stressor. They mentioned that

a cognitive appraisal process is encountered by survivors who appraise and evaluate the

degree of threat posed by this stressor, and their resources, abilities to cope with it, and

then those survivors can shape the coping behaviors and emotional responses. Based on

the previously mentioned types of survivors; constructive, destructive, passive, and

active, survivors are believed to have two appraisal phases for downsizing process, and

these appraisals affect the responses they show post-downsizing. When downsizing is

perceived as a threat according the primary appraisal by survivors, and this perception is

controlled by level of their trust in management, its competence, and perceived justice

in its implementation procedures. That is why survivors exhibit cooperative and

constructive responses, otherwise they will respond in destructive ways. While when

survivors engage in secondary appraisal process, they think about their capability in

coping with changes incurred by this downsizing. This is affected by degree of

employee empowerment, sense of self-control, and concept of work redesign; it’s

perceived intrinsic changes. That is why survivors exhibit active responses to

downsizing if they are empowered and intrinsically satisfied with new changes

introduced, otherwise they will respond in passive way (Mishra and Spreitzer, 1998).

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

More specifically, three components of justice theory determine survivors’

responses were mentioned by Sahdev (2004). These items are distributive, procedural,

and interactional justice. These elements relate to aspects of both management and

survivors on downsizing process; as management considers this process as strategy to

increase efficiency unlike survivors who consider it threatening factor to their job

security. Distributive justice related to scarcity of resources and how management

distributes them. While Procedural Justice refers the process through which decisions on

resources allocation are made. Finally, Interactional Justice refers to means by which

management introduces and communicates information to its employees (Sahdev,

2004). Spreitzer and Mishra (2002) highlighted the important role played by perceived

justice in shaping survivors’ responses. They stated that when survivors perceive

downsizing to be conducted in fair conditions, they will be less threatened and more

committed to their organization. While if they thought it was unfairly conducted, they

will be more willing to withdraw due to reduced organizational loyalty and commitment

(Spreitzer and Mishra, 2002).

Both distributive and procedural justice received much attention of previous

researches on downsizing; therefore, both items will be discussed below. Figure 2

shows how trust, empowerment, work redesign, and justice affect survivors’ responses

according to the appraisal phase survivors are encountering.

Figure 2: Theoretical Framework of Survivor Responses to Downsizing

Source: ( Mishra and Spreitzer, 1998)

While Thornhill et al (1996) stated that factors shaping these responses are dependent

on survivors’ previous experience with being laid off, the external environment like the

availability of alternative job opportunities, and finally the organization itself (Thornhill

et al, 1996). These feelings of decreased loyalty, satisfaction was justified by Levitt et

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

al (2008) who stated that survivors consider downsizing a social matter more than an

economic one, they shape their perceptions about actual motivations of management to

downsize, and accordingly they react to it and their relationship with their organization

is determined (Levitt et al, 2008).

Role of Distributive Justice

The term distributive justice refers to concern with outcomes of downsizing

process and whether they were perceived and whether they represent aspirations of

survivors’ outcomes. It is more related to laid-off employees and whether they were

compensated. This fair compensation is positively perceived by survivors who believe

they will be fairly treated and compensated if further future downsizing activities are to

be done; this enhances survivors’ commitment to their organization. The degree of

distributive justice perceived by survivors also depends on how survivors believe their

organization fairly distributed burdens and responsibilities between top management

and other downsizing victims, so if survivors noticed that bonuses were granted to top

management while poor payments were paid to victims they would be more suspicious

of their organization strategies’ fairness (Spreitzer and Mishra, 2002).

The term distributive justice was further explained by Clay-Warner et al (2005)

who defined it as outcomes directed to a specific set of recipients and the fairness of

their distribution. These outcomes are expected from those individuals in return for their

exerted effort, experience. They stated that distributive justice is a predictor for

organizational commitment among downsizing victims rather than survivors. It was

further stated that distributive justice is more related to employees’ psychological

contract with their organization which is affected by the way downsizing is conducted;

this contract is about unconscious expectations employees hold towards their

organization, and if it will support and embrace their needs whether psychological or

organizational needs. These expectations relate to received payments, guaranteed job

security, mutual respect and recognition. When downsizing takes place, commitment,

perception and integrity of employees change either negatively of positively according

to the degree of perceived justice (Clay-Warner et al, 2005).

Role of Procedural Justice

Procedural justice refers to degree of fairness by which downsizing procedures and

processes were conducted. It is related to self-respect and perceived value an individual

feel when he/she belongs to certain social entity. In the case of downsizing, it is about

the degree to which its procedures and criteria were clearly defined against decisions

made on bias-based trends. When survivors believe they are to be communicated before

any potential downsizing decision, they will be less threatened and more committed to

their organization. Procedural fairness also refers to fairness of means, and whether they

are consistent among people, free of bias and hidden unclear agendas, and if they are

based on clear ethical standards. As individuals always look for being valued for

belonging to certain groups, procedural justice is more dominant on individual’s

reactions to downsizing than distributive justice; especially if those individuals had

strong sense of commitment and belongingness to their associated groups. Based on

definitions of both types, Clay-Warner et al (2005) stated that distributive justice was

mainly predictor for commitment among downsizing victims unlike procedural justice

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

which was mainly a predictor to commitment among survivors (Clay-Warner et al,

2005).

Role of Empowerment

The word empowerment was defined by Spreitzer and Mishra (2002) as the felt

sense of self- control in work; this sense can be elaborated within four areas linked to

person-work relationship, which are: meaning, competence, self-determination, and

impact. For meaning it is about having a personal aim for performing work, this

personal aim helps individual overcome uncertainty. Competence is about possessing

required skills and competencies to perform their jobs, when survivors feel they are

competent, they are more able to adapt to changes in their work. Self-determination is

about being free in performing work, and impact which enables survivors to influence

the working system, so they hold a sense of control over their work (Spreitzer and

Mishra, 2002).

Employees’ empowerment is a tool to increase their attachment and organizational

commitment. It decreases their negative perceptions of downsizing threats to their job

security, so they believe they can cope with it and maintain their jobs when they have

higher sense of self- control in comparison to less managerial positions present after

layoffs. When survivors are empowered, they will be more committed and feeling their

jobs became enriched due to more responsibilities and duties they will hold. This

positive perception will make survivors react proactively and actively towards

supporting their organizations in appropriately operating after downsizing and incur less

costs and damages. They become more able to meet challenges and stress caused by

new conditions (Appelbaum et al, 1997). They had emphasized the importance of

employee empowerment by elaborating how the company should be aware of possible

resistance and rejection of its survivors to implement sought changes. It should be aware

that its employees are the most asset. That is why it cannot ignore human factor when

downsizing; it should inform them about these coming changes, provide a clue about

their future with their jobs, and how the new structure will be like (Appelbaum et al,

1997). If survivors do not feel a sense of control over their work during stressful

situations, they will prefer to withdraw and act passively due to their belief they cannot

influence their organization. That is why the above four empowerment dimensions are

critical in helping survivors feel attached to their organization. Attachment and self-

control are also positively related to employees’ loyalty, affective commitment, and

negatively related to turnover rates (Spreitzer and Mishra, 2002).

Role of Trustworthiness in Management

Trust is defined as having the will to be vulnerable and expecting that some losses

might appear when interacting with other people. When survivors have trust in

management, they will exhibit less negative post-layoffs behaviors. That is why

management should be open and honest with its employees; it should involve them and

provide them with explanations about its actual motivations for downsizing. If survivors

lost this trust in management, they will be more cynical and fearful in their responses;

they will doubt intentions of management (Spreitzer and Mishra, 2002). Trustworthiness

has some dimensions which are: caring for interests of others, competency, honesty, and

reliability. If management was able to address all these dimensions; through considering

interests of its employees, being competent in its practices, exhibiting reliability in its

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

promises, being open and honest with them about the actual organizational conditions,

they will have stronger attachment to their organization (Spreitzer and Mishra, 2002).

Role of Clear Communications

Open communication is a critical component which affects survivors’ responses.

As previously indicated; when survivors are informed of true actual motivations of

management to downsize, they are less likely to exhibit post-downsizing negative

reactions (Thornhill et al, 1997). It was recommended for management to maintain

credible and focused communications with employees to avoid negative reactions which

would be created due to surprising actions. This clear communication can be realized by

two-way communication channels, availability of appropriate consultancy to employees.

Survivors should be well informed of all aspects of downsizing process, how their

responsibilities will be affected, and how they are expected to meet them. It is essential

to inform them also about the status of their coworkers and how they were treated and

compensated (Thornhill et al, 1996). Selmer and Waldstrom (2007) mentioned that

long-term post- downsizing organizational performance depends on its ability to involve

its employees and carefully consider their recommendations and suggestions in its

implemented redesign processes, and also on the clearness of decisions which are

related to dismissed workers; management should be aware of the possibility of making

faulty decisions by laying-off skilled workers instead of low performers, so it should

have clear criteria while dismissing its employees (Selmer and Waldstrom, 2007).

Role of Work Redesign

Work redesign is related to the degree of consistency between work redesign and

downsizing. This affects the secondary appraisal process of survivors; if changes are

creating better intrinsic quality for work, survivors will more likely to be capable of

coping with downsizing activities and exhibit active responses. This intrinsic aspect is

related to job variety and autonomy. For job variety, it is how tasks and responsibilities

of survivors increased after their colleagues were laid-off, this increase and variety in

tasks can help survivors develop their skills and coping abilities so that their motivation

and flexibility increase. While for job autonomy, when downsizing is accompanied with

flatter organization and less hierarchical levels; survivors will feel more empowered to

make decisions as they possess more autonomy in their work. That is why they feel self-

control and can perform work effectively ( Mishra and Spreitzer, 1998).

2.8 Psychological effects of downsizing on survivors

The role of clear communications as a factor affecting survivors’ responses shows

the fact that some negative psychological responses could be avoided by management if

it maintained clear and honest communication flow with its employees (Thornhill et al,

1996). While trustworthiness in management helps it to reduce the probability of

mistrust and cynical emotions which are held by survivors when it considers their needs

and becomes reliable in its made promises to avoid losing their organizational

attachment (Spreitzer and Mishra, 2002). While for the role of justice whether

procedural or distributive, survivors exhibit fewer negative responses to downsizing

when the degree of perceived justice is high and explaining the true motivations of

management to downsize (Spreitzer and Mishra, 2002; Levitt et al, 2008). It is quite

clear that if management considers these various factors, it will help reduce any possible

negative reactions of its employees after layoffs (Sahdev, 2004).

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

2.8.1 Downsizing and Survivors’ Commitment/ Attachment

Spreitzer and Mishra (2007) indicated that downsizing activities negatively affect

survivors even if their job security was not threatened. They referred to this feeling as

the degree of attachment survivors hold towards their organization. It is about the

exchanged commitment between survivors and their organization. Organizational

commitment has three dimensions which affect performance levels of employees within

the organization. These dimensions are the affective, continuance, and normative

commitment. The affective commitment refers to the desire held by employees to

remain employed within the firm; continuance commitment refers to the need of some

employees to stay employed by their firm; and finally, normative commitment refers to

employees who remain within their firms due to their mental beliefs (Cross and

Travaglione, 2004; Spreitzer and Mishra, 2007). Some negative attitudinal and

behavioral actions result from declining commitment among survivors like increased

rate of voluntary turnover, negative symptoms of survivor syndrome, and sense of

psychological contract violation. The three phenomena are further explained more

below in order to realize how degree of attachment the survivors might hold post-

layoffs has an impact on their behaviors and emotions which are represented in their

willingness to quit their jobs, feel negatively about their organizations, and feel

psychologically violated in terms of their trust with their firms (Cross and Travaglione,

2004; Spreitzer and Mishra, 2007).

2.8.2 Voluntary Turnover among survivors

A negative phenomenon which results from downsizing and is sometimes preferred

by some survivors is the voluntary turnover. As previously mentioned, voluntary

turnover rates are highest among employees who have low rates of affective

commitment towards their organizations. The impact of downsizing on voluntary

turnover among survivors and their intention to remain employed within their

organizations was further explained by Spreitzer and Mishra (2007) who indicated that

responses of survivors depend on trust, and justice. Spreitzer and Mishra (2007)

proposed a model if survivors who voluntarily quit their jobs do so as a response to a

shock in their organizational system. This shock which is caused by organizational

downsizing affects the stability of their social system in which they work and converts it

into other new perceived system, and this creates a need to reconsider organizational

relationship with these survivors. This model proposes that three elements determine

voluntary turnover rates among survivors. These factors are: Justice, employee

empowerment, and trustworthiness of management which have been previously

discussed. The framework shows that there in negative relationship between degree of

attachment and rates of voluntary turnover among survivors. As when survivors feel

attached towards their firms, they are less willing to quit their jobs (Spreitzer and

Mishra, 2002). Figure 3 shows this following frame.

Trustworthiness of

Management

Empowerment

Voluntary

Survivor

Turnover

Survivor

Attachment

Justice

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Figure 3: Theoretical Framework

Source (Spreitzer and Mishra, 2002)

2.8.3 Survivors’ Psychological Contract Violation

Another negative phenomenon facing survivor results from downsizing and

reduced organizational commitment is called psychological contract violation.

Psychological contract consists of unwritten informal procedures and rules shaping the

relationship between employers and employees within the organization. This contract is

a necessary element which affects how survivors respond to downsizing activities

according to the degree their relationship with their organization changes (Levitt et al,

2008). Some unique characteristics of psychological contracts were mentioned by

Sahdev (2008) who stated these contracts are deliberate, time evolved, subjective, and

enable exploitation as well as generosity (Sahdev, 2008).

Furthermore; Morrison and Robinson (1997) stated that a psychological contract of

employee is about any beliefs held about the expected mutual treatment between the

employee and his/her employer. It is about reciprocal responsibilities and rights of each

party which help shaping the relationship between them in their organization. The

violation of this contract creates many negative effects on the organization and on its

employees; it reduces employees’ morale, trust, satisfaction, and willingness to remain

within the organization. Some employees might even exhibit some violent behaviors or

file some lawsuits against their organization; these law suits harm the organizations’

reputation if published to the public. Employees feel their organization was not up to

their expectations and failed to meet its obligatory responsibilities. Actions taken by

organization like restructuring, reorganizing, or downsizing have negative psychological

effects on their employees who begin to doubt their perceived job security and fair

treatment. These psychological contracts are based upon promises which are perceived

by employees about any future intentions communicated to them through their

organizations. These intentions can be delivered to employees through various means

whether formal or informal, so they can be in form of explicit organizational policies,

written documents or discussions (Morrison and Robinson, 1997). As Levitt et al (2008)

mentioned, violation of psychological contracts leads to increased levels of stress and

turnover among survivors who feel less loyal, committed to their organization in which

they lost their trust (Levitt et al, 2008).

2.8.4 Survivor’s Syndrome ‘‘Survivors’ Sickness’’

Reduced organizational attachment leads to another post-layoff phenomenon

which heavily affects survivors. This phenomenon is called ‘‘Survivor Sickness/

Syndrome’’. It was described by Makawatsakul and Kleiner, 2003; Virick et al, 2007)

who defined it as survivors’ loss of their trust and belief in managerial fairness and

justice, and suffering from feelings of anger, frustration, and job insecurity. Appelbaum

et al (1999b) defined survivors’ syndrome as elements which are driving companies that

adopt downsizing to fail in maintaining the organizational goals after downsizing. All

symptoms are due to the fear of those survivors and that they are unsure about their

future with the organization, therefore this leads to losses on the long run for the

organization especially if management ignored those survivors. While Levitt et al

(2008) referred to survivor syndrome as a mixed set of feelings, and attitudes

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

accompanied with actions held by surviving employees within the organization. These

feelings include anger, anxiety, and sadness. They mentioned the fact that most

organizations lack the required level of knowledge on how to deal with survivor

syndrome, and accordingly these organizations fail to provide adequate means of

support to those survivors. There is still a belief that surviving employees should just

conform to management orders and continue performing their regular tasks along with

tasks of those laid-off coworkers (Levitt et al, 2008).

Kinnie et al (1998) further discussed the phenomenon of survivor syndrome

through stating that companies which implement downsizing may not be fully aware of

its effects on its surviving employees who become more narrow-minded, risk-averse as

they lose their flexibility and tend to do tasks in traditional way and reject creativity.

These symptoms accompanied with low morale and job security, more stress, more

absenteeism and turnover (Kinnie et al, 1998). Few years later, Makawatsakul and

Kleiner (2003) stated that the sympto ms are obvious and stronger if downsizing is

done with less communication of employees and little involvement of stakeholders in

the decision. These negative reactions may destroy the whole firm. It was stated too that

although survivors may be still hold some feeling of being grateful to management

which retained and kept them working for the firm, they are being attacked by feeling of

guilt about their former colleagues and by their fear from being laid-off like them in the

future (Makawatsakul and Kleiner, 2003). In this regard, Levitt et al (2008) mentioned

that survivor syndrome is a great threatening factor to the organization’s performance,

profitability, and productivity levels. This is due to the new organizational structure,

new roles and responsibilities held by survivors (Levitt et al, 2008).

Cascio (1993) illustrated an example of US Replacement Company called Right

Associates. When it surveyed some senior managers in American firms which

undertook some downsizing activities, seventy four percent of these managers explained

how the surviving employees exhibited certain behavior which distracted management

and how their morale noticeably declined. Cascio (1993) assumed the reason of this was

the lack of adequate communication between management and employees, due to

traditional belief in US firms’ senior managers that their employees are no more than

input factors in production process, so they could be easily managed, replaced when

unneeded. This lost focus on employees’ needs and values was a reason for this

declined morale and trust in management (Cascio, 1993).

3 Research Methodology

Through examining the literature on downsizing and its negative effects on

survivors, a lack of empirical research in some areas despite their importance has been

noticed. One limitation about previous studies is the lack of consideration for

psychological status of survivors after layoffs although many previous researchers have

attempted to examine the relationship between downsizing and negative psychological

effects on survivors. This claim was mentioned by many researchers like (Kinnie et al,

1998; Makawatsakul and Kleiner, 2003; Appelbaum et al, 1997) who stated that some

firms which lay-off their employees are not fully aware of the negative effects which

downsizing create for their surviving employees, and that management does not give

much attention to changes their employees face because of the traditional narrow-mind

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

sets, risk-adversity, less flexibility, and more tendency to do tasks in traditional way.

That is why Management does not notice symptoms of low commitment, more stress,

absenteeism, and turnover which represent symptoms of survivors’ syndrome. These

researchers highlighted the need of organizations to address needs of their surviving

employees, and how management must be aware that it is not enough to keep survivors

updated about their current situation, and always update them about any possible future

changes or any new opportunities. These aspects were further explained by

Makawatsakul and Kleiner (2003) who mentioned that negative symptoms are more

obvious and strong if downsizing was performed with no or little communication of

employees and little involvement of stakeholders in the decision which might destroy

the whole firm because of survivors’ guilt about former colleagues, and their fear from

being laid-off like them in the future. However, it is clear that many aspects concerning

survivors’ post-layoffs psychological status was not fully covered by these previous

studies, and accordingly one could conclude that there has been great ignorance of

survivors’ needs, their career development opportunities. Survivors have a need for

management’s support as well; this support can be financial in terms of monetary

benefits, or it can be psychological support through encouraging survivors to maintain

their trust and loyalty to the organization. Moreover, it can also be concluded that when

organizations undertake layoffs, their main focus is solely presented in management

perspective on downsizing process, its motivations, dimensions, and other economic

factors management considers, so it ignores these employees, and gives no attention

about their psychological well-being (Carbery and Garavan, 2005).

Hence, the present study aims at unleashing the relationship between perceived

organizational justice and the degree to which survivors suffer from negative symptoms

of survivor syndrome. Meanwhile, two major symptoms of survivor syndrome are to be

examined within the current study. These symptoms are: organizational commitment/

attachment, intention for voluntary turnover. This is because survivor syndrome

includes many symptoms which all can be narrowed down into two major behavioral

and attitudinal reactions which survivors perform post-layoffs. The specification of

major symptoms further helps in segmenting the major research question for the study

into three specific research questions which are:

• Research Question 1: ‘‘What is the impact of Procedural Justice on

Organizational attachment among survivors?’’

• Research Question 2: ‘‘What is the impact of Procedural Justice on voluntary

turnover rates among survivors?’’

Based on the above-mentioned research questions, there are some expectations for the

relationship between procedural justice as the independent variable and the two

variables of survivor syndrome which represents the dependant variable. The

hypotheses for the expected findings are as follows:

• H1: There is a positive relationship between procedural justice and

organizational attachment among survivors; survivors who perceive downsizing

to be fairly implemented are more likely to have higher levels of attachment.

• There is a negative relationship between perceived procedural justice and

intention of voluntary turnover among survivors; survivors who perceive layoffs

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

to be fairly implemented are less likely to exhibit intention for leaving the

company.

The mentioned research questions seek to find an answer the supposed relationship

between perceived justice and survivor’s psychological well-being represented in

symptoms of survivor syndrome. For the current study which aims at exploring the

relationship between organizational perceived justice and the psychological status of

survivors, there are some identified variables which will be used to examine this relation

and test the previously mentioned hypothesis. These items are adapted from the

literature on downsizing which provided some useful measures for Justice. The

independent variable of Justice; both procedural and distributive can be considered. Yet,

only the procedural justice will be used as the sole independent variable as it was

mentioned in the literature that procedural justice is a main predictor of commitment

among survivors, while distributive justice was mainly predictor for commitment

among downsizing victims (Clay-Warner et al, 2005). That is why in the current study it

will be more appropriate to focus on procedural justice as the study is addressing

survivors of downsizing and not victims.

3.1 Research Design

In order to answer the research question and test the proposed hypotheses, a mix of both

quantitative and qualitative methods will be employed (Cooper and Schindler, 2008).

This combination of both qualitative and quantitative methods aims at increasing

reliability and understanding of studied relation is known as triangulation. In this study,

this triangulation is needed to realize better and deep consideration of the relationship

between perceived justice and survivor syndrome. In the current study, quantitative

study will be done first through distributing surveys, and then it will be followed by

qualitative study through setting interviews. This sequence in implementation of both

methods is an appropriate means to help validation of findings which will result from

quantitative method.

Structured Surveys

Some self-administered surveys (n=101) will be used in order to provide some

statistical conclusions about these effects. Surveys are useful when examining what

reactions or response had occurred, and by which rates (Cooper and Schindler, 2008).

Surveys are appropriate means to gather data from participants and compare it to obtain

conclusions. They are less costly than other various means. This self-administered

survey will be used to guarantee rapid responses and saved time which could be lost if

other means are to be used. In addition, surveys require minimum number of staff to be

present while conducting the study procedures (Cooper and Schindler, 2008). Moreover,

the survey will be a structured one including mainly closed-ended questions. This aims

at accessing information in more convenient and rapid way which is more adequate

when performing data analysis (Cooper and Schindler, 2008). Many scales will be

implemented in the survey to avoid biased questions. For example: Dichotomous

questions which offer two mutually exclusive choices (Yes, No) are implemented. Other

multiple-choice questions will be presented. Moreover, Checklists in which the

respondent can select all that applies are presented (Cooper and Schindler, 2008).

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Moreover, respondents were told about the main objective of the survey to maintain

confidentiality. The information submitted by the respondents was gathered on an

anonymous basis due to ethical considerations which imply the secrecy of information

provided by respondents as it was solely obtained for research purposes. This aims at

delivering a sense of confidentiality and privacy to participants who might hesitate to

reveal information about their feelings, emotions, and attitudes towards their

organizations which implemented downsizing activities. The surveys will be distributed

through online websites, mails, and through being dropped off in the targeted firms. The

web-based survey will be used because of its cost-savings, accessible respondents, and

anonymity basis (Cooper and Schindler, 2008). It should be considered that there is the

probability that some employees might not be present at the time of the study within

their organizations; they can be on vacation or sick leave, so some surveys will be

available online for those who might be absent but have the interest on filling the

questionnaire. This web-based survey will be delivered and collected through the

Internet by whoever employee who is interested in filling it. Moreover, surveys will be

distributed in both Arabic and English languages. That is because some manual workers

might be illiterate or might have poor knowledge of English language. This is to be

convenient and considering to all possibilities. This means that both versions in English

and Arabic were made equivalent in their meanings to guarantee consistency and

validity of questions and measurements.

Semi-structured Interviews

Three follow up interviews will be done to validate the findings of surveys, clarify the

goal, perspectives of the questions, and gain deeper insights about the nature of the

examined relationship between procedural justice and symptoms of survivor syndrome;

they help in obtaining more reliable data from participants as some data cannot be

obtained through objective nature of surveys, so interviews can be the appropriate

means to access this data, and subjectively evaluate it (Cooper and Schindler, 2008).

Moreover, among those 101 respondents, only 3 follow up interviews will be

conducted; one survivor will be interviewed from the contacted companies; public,

private, and NGO. The interviewees would voluntarily participate in the interview as at

the beginning of the distribution process they will be told about the interviews and

whoever is interested can participate. Interviews are employed to assess the degree to

which psychological contract of those surviving employees was violated the degrees of

susceptibility they hold towards their organizations, and reasons for this mistrust. It will

also evaluate the degree to which negative symptoms of survivor syndrome are evident

within their hidden attitudes and emotions through helping to obtain some

understanding for emotions which are held by survivors towards their organizations.

This detailed discussion can help in obtaining more insights about the violation of their

psychological contracts. It can also help in obtaining more information about any

special incidents which might have changed the perceptions, attitudes, and behavior of

survivors (Cooper and Schindler, 2008). The interviews were decided to be semi-

structured to allow for more confidentiality and willingness of interviewees to respond,

share, and elaborate their thoughts and opinions (Cooper and Schindler, 2008).

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

3.2 Research Sample/ Sampling Techniques

While deciding whether to select the participants in the study on sampling or census

basis, sampling basis was selected rather than census. This is for some reasons which

nominate sampling to be more beneficial like fewer costs, more accurate results

obtained especially if the sample is accessible, more rapid rates of data collection due to

controlled number of participants (Cooper and Schindler, 2008). A total of 120 surveys

were distributed. However, only 101 respondents adequately responded to the surveys.

The survey had a response rate of 84%. (n=101). For the characteristics of the sample,

it included 101 survivors who are employed within selected organizations. The targeted

employees in the sample are expected to be from public sector, private sector, and Non-

Governmental Organizations (NGOs). The inclusion of NGO along with private and

public-sector companies is due to the increased proportion of individuals who joined

NGOs recently in Egypt. Moreover, including both public and private sector companies

is due to the fact that public and private sector companies are likely to have various

perspectives on layoffs due to some aspects related to employee insurance, contracts,

salaries, labor unions, and management practices. As mentioned earlier in the literature,

public firms might have layoffs in forms of privatization, or low governmental available

budgets. In general, as mentioned by Tsai and et al (2006), firms whether public or

private are implementing downsizing practices as the most effective restructuring

strategy helping them realize higher profits, higher share prices, maintain their

competitive position, overcome managerial difficulties, and adapt to environmental

shifts. In the case of Egypt, layoffs are taking place in public sector companies which

are sold to private owner through privatization. This process keeps few employees

within sold firms, while other laid off victims can hardly find other places to work in.

Sometimes it can be even worse when sold companies are closed till they are converted

into other businesses. In this case all employees become jobless and all become victims.

The public-sector companies can be firms which were privatized years ago or firms

which still operate in the public sector till nowadays. In addition, Egyptian

governmental firms cannot dismiss employees as they have contracts which provide job

security to employees who only quit work when they retire and are paid their pension

funds. Therefore, layoffs in public firms are likely to have the form of early retirement

programs for employees. This is not the case in private firms which might downsize due

to factors related to their competitiveness, market share, or other various motivations

which were previously discussed in the literature. The other private companies can be

operating in major sectors like banking, real estate, or alliances It was previously

mentioned that Egypt nowadays face some economic hardships due to the political

instability, and that is why it is expected to have high rates of layoffs, unemployment

within the current period due to the inability of some firms to pay salaries to their

employees.

About the demographics of the respondents, both genders were targeted. Yet, it was

expected to have larger number of male respondents due to the fact that some female

employees might be absent for longer periods due to family obligations. This makes

some companies prefer to hire male employees to guarantee their availability for longer

periods with fewer vacations like women counterparts. The participants were expected

to be from all managerial levels within their organizations; these respondents can be

manual workers who are responsible for running machines, performing manual tasks

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

like answering the phone, responding to customers, or taking orders from customers.

There were no limitations which are based on age, seniority, or gender.

More specifically, the selected employees to participate in the survey were selected

according to simple random sampling which is one of the probability techniques; it will

be used due to its easiness and convenience in terms of costs and time spent, and

equality among participants as each one has the same probability to get selected

(Cooper and Schindler, 2008). Depending on the total number of employees within

each organization, a simple classification will be done to distinguish those survivors

within each organization from those who might have joined the organization after it has

downsized. Then the simple random technique will be employed to select survivors who

will participate in the study and fill the survey. This classification in important as

employees who joined the organization after it had downsized cannot assume same

feelings and attitudes of survivors who already witnessed the entire process and how

management treated victims.

3.3 Research Instruments

As mentioned above, both surveys and follow up interviews were implemented; more

details are discussed below.

The Survey: The survey includes three main sections; the first section consists of

eleven items which help obtaining some basic demographic information about

respondents. These questions help gather information about the respondents’ gender,

age, current work nature; whether the employee was full-timer, part-timer, or working

on a contractual basis, the employment status ‘employed, unemployed’, the type of the

firm; ‘if it is an NGO, a public, a private sector firm’, tenure and length of service with

the firm, the level of obtained education; if the respondent had only high school degree,

a diploma, a bachelor degree, or pursuing a post-graduate degree. The respondents were

asked if they were members in labor unions. These variables were expected to be related

to dependant variables of the study; as higher educational levels might help the survivor

to better adjust to downsizing as he/she perceives it as a positive change or makes

him/her more willing to enhance skills and competencies to remain employed within the

firm. While the age factor is also important; as older employees are supposed to be more

attached to their firms and less likely to voluntarily quit their jobs due to their attained

seniority levels too which make them unwilling to search for new opportunities with

other firms. The degree of organizational commitment was expected to be positively

related to seniority, education, and age. As for younger employees, they are relatively

more concerned with the mental conviction and value of their performed work, so they

are expected to be less affectively attached to the organization. In the online version of

the survey, respondents were asked if they had witnessed a layoff in their current

organizations. The respondent who responded by stating that he/she was dismissed was

recognized to be a layoff victim; and therefore he/she was not required to answer the

survey, while the respondent who states he/she is still employed after the layoff is

considered a layoff survivor. This question was necessary in the online version of the

survey to confirm that the respondent is a downsizing survivor, and not a victim. Any

victims who answered the survey online would not be included in the sample.

Semi-structured Interviews: The interview had an expected time of 15-30 minutes.

Six major questions which address the following aspects were asked to each of the three

interviewees. ‘What do you think were the actual motivations for your company to lay-

off its employees?’ ‘Can you please explain to us which reasons encourage you to

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

remain employed within your firm?’ ‘Do you believe that downsizing created more

positive changes in the workplace, and why?’ Describe what you believe was most

negative about management undertaken layoff strategy? ‘If you think downsizing was

not properly handled ‘Do you feel threatened by the idea of being the next one

dismissed, and why?’ ‘To what extent do you feel more stress and workload post-

layoffs?’ As previously indicated, these questions of the follow up interviews were

developed to realize better understanding of the degree to which commitment among

survivors was affected; to assess the type of commitment which is shaping their

responses; if they were staying with their firms because they love to, need to, or ought

to. The questions also helped in obtaining more information about hidden negative

perceptions related to management honesty, and openness with its employees.

3.4 The Research Variables

Independent Variable: The independent variable of procedural justice was explained

in the literature by many researchers who stated that procedural justice refers to degree

of fairness by which downsizing procedures and processes are conducted; whether they

are consistent among people, free of bias and hidden unclear agendas, and if they are

based on clear ethical standards it means the degree to which management had

procedures and criteria which were clearly defined against decisions made on bias based

trends. When survivors believe they are to be communicated before any potential

downsizing decision, they will be less threatened and more committed to their

organization (Clay-Warner et al 2005). In the second section of the survey, there were

main four questions measuring procedural justice. The first question had a Likert Scale

with five items from (1= Strongly Disagree, to 5= Strongly Agree) sentence which

assessed the degree of fairness by which survivors believe that their former colleagues

were fairly treated and taken care of by management. The second sentence assessed the

existence of clear unbiased consistent criteria when selecting dismissed employees; it

follows the Likert scale; the respondent could choose among five alternatives (strongly

agree, agree, neutral, disagree, strongly disagree). The final two questions aimed to

assess whether these laid off employees were adequately communicated and notified by

management pre-downsizing, and finally if the organization allows its employees to

participate and give suggestions when major organizational change is to take place

(Spreitzer and Mishra, 2002; Clay-Warner et al , 2005).

Dependent Variables: the third section of the survey aimed to measure the

dependant variables which are organizational commitment, and voluntary turnover.

These variables were measured to indicate the impact of procedural justice on each of

these items which indicate the degree of survivor syndrome. The phenomenon of

survivor syndrome was explained in the literature by many researchers (Makawatsakul

and Kleiner, 2003; Virick et al, 2007; Appelbaum et al, 1997; McKinley et al, 1995)

who mentioned some of its negative symptoms like declining employee morale and

loyalty, management mistrust, poor performance, poor productivity, high turnover,

frustration, anger, and job insecurity. They stated that survivors carefully detect how

management treats other laid off workers and upon their perception whether they were

compensated or not, survivors shape their reactions and post-downsizing behaviors.

That is why survivors’ perception of the downsizing process affects their performance

and controls negative feelings held after downsizing, and this perception is revolving

around the fairness by which management implemented its downsizing approach, and

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

that it can be concluded through some aspects like previous communications with

employees about changes facing the organization, keeping them updated about their

future with their firm, providing some training programs for survivors to regain their

self-confidence, and to be socially-responsible towards their its laid-off employees.

Organizational Attachment: a Likert scale was used through some statements

requiring the respondents to indicate the extent to which they agree with each statement

(from 5 = strongly agree to 1 = strongly disagree) with the following: ‘Regardless of my

current job position, I am willing to remain employed within my organization,’ ‘I am

proud to be an employee in this organization,’ ‘I am still willing to exert more effort

beyond what is normally expected of me,’ ‘ if I am offered higher salary in another firm,

I will leave my current one,’ ‘ I consider myself as being a loyal employee’ (Spreitzer

and Mishra, 2002; Clay-Warner et al, 2005).Another question in which the respondent

was required to select all that applies assesses dimensions of organizational

commitment; the affective, continuance, and normative dimensions; by selecting the

reasons encourage him/her to remain employed within their current firm; whether it was

due to attachment to the organization, the need to remain employed. Ex: financial need

and the mental conviction with work's value. Finally, a Likert scale question measuring

Job security was used to assess if the survivor’s job security was the same after layoffs

or it declined.

Voluntary turnover was measured through assessing the intention of the respondent to

quit. The respondent chose from Likert five scale choices regarding if he/she was

looking for another job opportunity in another company’ (Cross and Travaglione, 2004).

Another question was used to get more information about whether respondents had

increased their absence levels after layoffs were conducted (Cross and Travaglione,

2004).

3.5 Research Procedures

Once the survey was ready, it was piloted randomly to some employees to assess if it

would help reaching the desired results. Twenty employees had read the survey and

mentioned their comments about the language clearance, ambiguous meanings, and its

length. About the procedures of the study, the first step in the procedure was to contact

the proposed three companies; private, public, and NGOs to obtain their approvals for

distributing questionnaires there. This step was expected to take some time, as these

targeted firms ought to receive full description about the study, the survey’s elements,

and to determine which days to be there to distribute it. The allocated time period for

this phase was three weeks. Then, these firms specified names, numbers of surviving

employees who were there when downsizing took place, and those employees who

joined the company after the downsizing incidence. This action was necessary to avoid

participation of employees who did not witness the downsizing. The selected

participants were selected through random sampling as previously mentioned. The time

period allocated for this phase was two weeks. After that, the third step was to distribute

surveys. The surveys were first distributed among participants; this manual task took

about two days, then another two days were given to fill in the online surveys, and other

three days were needed to translate the Arabic version into English format to provide

consistency while analyzing data. This stage took two weeks period for each company,

so there were total of four weeks needed for the stage of distributing surveys and

interviews’ setting. After that, another four weeks were needed to analyze the results

and obtain statistical indicators about the measured variables and the tested hypotheses.

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Finally, there were two weeks to summarize the data gathered, form conclusions,

finalizing the research, and presenting the findings of the study along with

recommendations for future research.

3.6 Data Analysis:

The Statistical Package for Social Science Standard (SPSS) software was used to

analyze the data collected data from the surveys. The data obtained from respondents

(n=101) was entered the SPSS in a period of two week. While the analysis of qualitative

data obtained through follow up interviews was gathered in a period of week. As a first

step, the frequency tables were used to obtain some insights of the respondents’

demographics, the studied relationship between procedural justice and symptoms of

survivor syndrome. Frequency tables also present some bar charts which visualize the

percentage of each item in the survey based on the respondents. Then cross tabs and Chi

square were used to describe relationship between two variables and to obtain statistical

information about the significance of the relationship between these two variables.

4 Results and Findings

This section shows the ways by which data collected was analyzed. The data analysis

started by frequency tables and accompanying bar charts, then cross-tabulation was

done. Afterwards, the correlation analysis was done, and it was followed by the simple

regression analysis.

4.1.1 Frequency Tables

Table 1: the sample (n=101) included 57 males and 44 females. The following

frequency table exhibited there was no missing answers the total valid number was 101

respondents. There was larger number of male respondents as previously expected. It

was clear that previous expectation about larger number of male respondents was

relatively true; as male employees outnumbered female counterparts.

Table 1: Gender

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

Male

57

56,4

Female

44

43,6

100,0

Total

101

100,0

Table 2: Out of the 101respondents, there were 36.6% (n=37) survivors below 30.

While 42, 6 % (n=43) were between (31-45) years old, and 17, 8% (n=18) were

between (46-60) years old, and only 3% (n=3) were above 60.

Table 2: Age

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Below 30

37

36,6

Between (31-45)

43

42,6

79,2

Between (46-60)

18

17,8

97,0

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Above 60

3

3,0

100,0

Total

101

100,0

Tables 3, 4: among the 101 respondents, 6, 4% (n=61) were full-timers, 24, 8% (n=25)

were part-timers, and 14, 9% (n=15) were working on a contractual basis. While the

type of the firm showed that 61, 4% (n=62) were working in private sector firms, and

30, 7% (n=31) were working in NGOs, while only 7, 9 % (n=8) worked in public sector.

Table 3: Current Work Nature

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

Part-timer

25

24,8

Full-timer

61

60,4

85,1

Contractual

15

14,9

100,0

Total

101

100,0

Table 4: I am currently working in a

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Public Sector

8

7,9

Private Sector

62

61,4

69,3

NGO

31

30,7

100,0

Total

101

100,0

Table 5: the educational level of respondents reflected that 73, 3% (n=74) were bachelor

holders, 7.9% (n=8) obtained a diploma degree, while only 2% (n=2) had a maximum

education of high school, and finally 16, 8% (n=17) were pursuing their post graduate

studies. While table 6 concerning the position of respondents, 29, 7% (n=30) were

working as manual workers, 34, 7% (n=35) were in middle management, while 35, 6%

(n=36) worked in senior management positions.

Table 5: My degree of education involved

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

High School

2

2,0

Diploma

8

7,9

9,9

Bachelor’s degree

74

73,3

83,2

Post-Graduate Studies

17

16,8

100,0

Total

101

100,0

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Table 6: My current position

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Manual Worker

30

29,7

Middle Management

35

34,7

64,4

Senior Management

36

35,6

100,0

Total

101

100,0

Table 7: the question about the respondents’ tenure showed that among the 101

respondents, 46,5% (n=47) worked with their organization for a period less than 5

years, 36,6% (n=37) had a tenure between (6-10) years, only 7,9% (n=8) had a tenure

ranging between (11-20) years, while only 8,9% (n=9) had a tenure longer than 20

years. Moreover, in table 8, it is evident that 82, 2% (n=83) were not members in labor

unions unlike the minority of 17, 8% (n=18) who confirmed their belongingness to

labor unions. Table 7: I have been working for the organization for

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Between (0-5) Years

47

46,5

Between (6-10) Years

37

36,6

83,2

Between (11-20)

8

7,9

91,1

More than 20 Years

9

8,9

100,0

Total

101

100,0

Table 8: I am a member in any labor unions

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

Yes

18

17,8

No

83

82,2

100,0

Total

101

100,0

Table 9, among the 101 respondents (n=101), 21, 8% (n=22) strongly disagreed that

layoff criteria was clear and consistent among dismissed employees, while the majority

of 41, 6% (n=42) disagree about the consistency of layoff criteria, only 3% (n=3) were

neutral, 23, 8% (n=24) agreed, and 9, 9% (n=10) strongly agreed.

Table 9: The layoff criteria was clear and consistent among all dismissed employees

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

22

21,8

Disagree

42

41,6

63,4

Neutral

3

3,0

66,3

Agree

24

23,8

90,1

Strongly Agree

10

9,9

100,0

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Table 10, the majority of 37, 6% (n=38) disagreed about the sentence indicating that

their dismissed colleagues were fairly treated by management, while 23, 8% (n=24)

strongly disagreed, 7, 9% (n=8) were neutral, while 25, 7% (n=26) agreed and had a

belief that management taken care and fairly treated laid off employees. While only 5%

(n=5) strongly agreed.

Table 10: I believe the dismissed colleagues were fairly treated and taken care of by

management

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

24

23,8

Disagree

38

37,6

61,4

Neutral

8

7,9

69,3

Agree

26

25,7

95,0

Strongly Agree

5

5,0

100,0

Total

101

100,0

Table 11, when respondents responded to the question considering if their organizations

allowed for employees’ involvement and participation when major changes were to take

place, the majority of 41,3% (n=64) disagreed, 15,8% (n= 16) strongly disagreed,

34,7% (n=38) agreed, while only 5% (n=5) were neutral, and finally 3% (n=3) strongly

agreed.

Table 11: My organization allows employees' involvement and participation when

major change is to take place

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

16

15,8

Disagree

42

41,6

57,4

Neutral

5

5,0

62,4

Agree

35

34,7

97,0

Strongly Agree

3

3,0

100,0

Total

101

100,0

Table 12, when asked if those laid off employees were communicated and informed

before they got dismissed, the majority of 40, 6% (n=11) disagreed, 30, 7% (n=31)

agreed, only 3% (n=3) were neutral, 3% (n=3) strongly agreed, while 22, 8% (n=23)

strongly disagreed.

Table 12: Those laid off were communicated and informed before they got dismissed

Total

101

100,0

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Table 13, when asked about their loyalty, 12, 9% (n=13) strongly disagreed, 25, 9%

(n=26) disagreed, while 23, 8% (n=24) were neutral about their loyalty to their

organizations, while 19, 8% (n= 20) agreed to the sentence, and the remaining 17,8 %

(n=18) strongly agreed.

Table 13: I consider myself as being a loyal employee

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

13

12,9

Disagree

26

25,7

38,6

Neutral

24

23,8

62,4

Agree

20

19,8

82,2

Strongly Agree

18

17,8

100,0

Total

101

100,0

Table 14, when asked about their proud to be part of their prospective organizations, 17,

8% (n=18) strongly agreed, 20, 8 % (n=21) agreed, while 14, 9 % (n=15) were neutral.

There was 27, 7% (n=28) disagreed, and the remaining 18, 8% (n=19) strongly

disagreed to the sentence.

Table 14: I am proud to be an employee in this organization

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

19

18,8

Disagree

28

27,7

46,5

Neutral

15

14,9

61,4

Agree

21

20,8

82,2

Strongly Agree

18

17,8

100,0

Total

101

100,0

Table 15, among the respondents (n=101), 11, 9% (n=12) strongly agreed that they were

willing to remain employed with their firms regardless their job position, 22, 8 %

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

23

22,8

Disagree

41

40,6

63,4

Neutral

3

3,0

66,3

Agree

31

30,7

97,0

Strongly Agree

3

3,0

100,0

Total

101

100,0

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

(n=23) agreed, 19, 8% (n=20) were neutral, about 20, 8% (n=21) disagreed, and the

remaining 24, 8% (n=25) strongly disagreed.

Table 15: Regardless of my job position, I am willing to remain employed within my

organization

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

25

24,8

Disagree

21

20,8

45,5

Neutral

20

19,8

65,3

Agree

23

22,8

88,1

Strongly Agree

12

11,9

100,0

Total

101

100,0

Table 16, when asked about their willingness to exert more efforts beyond what was

normally expected of them, the majority of 27, 7% (n=28) strongly agreed, 14, 9%

(n=15) agreed, 24, 8% (n=25) were neutral, while 22, 8% (n=23) disagreed, and 9, 9%

(n=10) strongly disagreed.

Table 16: I am willing to exert more effort beyond what is normally expected of me

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

10

9,9

Disagree

23

22,8

32,7

Neutral

25

24,8

57,4

Agree

15

14,9

72,3

Strongly Agree

28

27,7

100,0

Total

101

100,0

Table 17, among the 101 respondents, 41,6% (n=42) strongly agreed to the question

asking them about them leaving their current organizations if they were offered higher

salary in another firm, 14,9% (n=15) agreed, while 8,9% (n=9) were neutral, while

20,8% (n=21) disagreed, and the remaining 13,9% (n=14) strongly disagreed to the

sentence.

Table 17: If I am offered higher salary in another firm, I would leave my current one

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

14

13,9

Disagree

21

20,8

34,7

Neutral

9

8,9

43,6

Agree

15

14,9

58,4

Strongly Agree

42

41,6

100,0

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Total

101

100,0

Table 18, when asked about the reasons encouraging them to remain employed, the

majority of 27, 7% (n=28) indicated it was due to their financial need, while 15,8%

(n=16) were emotionally attached to their organizations, while 21,8% (n=28) were

mentally convinced of the value of their work. Moreover, 10, 9% (n=11) remained

employed because of their financial need and attachment, 12, 9% (n=13) were mentally

convinced and attached, while 5, 9% (n=6) were mentally convinced and in financial

need as well. While about 5% (n=5) remained because their financial need, mental

conviction, and attachment.

Table 18: Which reasons encourage you to remain employed within your firm?

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Attached

16

15,8

Financial Need

28

27,7

43,6

Mentally Convinced

22

21,8

65,3

Attached and Financial Need

11

10,9

76,2

Attached & Mentally Convinced

13

12,9

89,1

Financial Need and Mentally

Convinced

6

5,9

95,0

Attached, Financial Need, and

Mentally Convinced

5

5,0

100,0

Total

101

100,0

Table 19 shows that about 31, 7% (n=32) agreed to the sentence indicating they were

looking for another job opportunity, 22, 8% (n=23) strongly agreed, only 3% (n=3)

were neutral to the sentence, while 23, 8% (n=24) disagreed, and finally 18, 8% (n=19)

strongly disagreed.

Table 19: I am currently looking for another job opportunity in another company

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

19

18,8

Disagree

24

23,8

42,6

Neutral

3

3,0

45,5

Agree

32

31,7

77,2

Strongly Agree

23

22,8

100,0

Total

101

100,0

Table 20 showed there was only total of 4% (n=4) respondents who agreed to the

sentence stating that their absence rates increased after layoffs were conducted, 29, 7%

(n=30) agreed, 26, 7% (n=27) were neutral, 18, 8% (n=19) disagreed, while about 20,

8% (n=21) strongly disagreed.

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Table 20: My absence rates increased after the layoffs were conducted

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

21

20,8

Disagree

19

18,8

39,6

Neutral

27

26,7

66,3

Agree

30

29,7

96,0

Strongly Agree

4

4,0

100,0

Total

101

100,0

Table 21, the question was addressing the job security levels of survivors, the majority

of 37, 6% (n=38) disagreed, 28, 7% (n=29) strongly disagreed, 30, 7% (n=30) agreed,

while only 3% (n=3) strongly agreed.

Table 21: Layoffs took place. However, My Job Security level in my current

organization is the same.

Correlation analysis was performed to examine the relationship between two the

variables of the current study in a linear way. Bivariate correlation was used to show the

significance of the relationship between the independent variable represented in

procedural justice, and the two dependent variables represented in organizational

attachment, and intention to leave ‘voluntary turnover’. Moreover, the direction and

level of this relation were shown; whether it was negative or positive, and whether it

was strong, medium, or low.

First, the correlation between procedural justice and organizational attachment, by

looking at the correlation table, the correlation seems to be positive. This positive

relation indicates the fact that when levels of procedural justice are high, the levels of

organizational attachment among survivors increase as well. Moreover, the correlation

Pearson coefficient was 0.879 which reflects a strong relationship. The significance

level was 0.000, this was less than 0.05 and therefore it reflected a high significance

level. Hence, a regression analysis will be performed for this relationship between

procedural justice and organizational attachment. While the correlation between

procedural justice and intention to leave showed a negative relationship. This means

Frequency

Percent

Valid Percent

Cumulative

Percent

Valid

Strongly Disagree

29

28,7

Disagree

38

37,6

66,3

Agree

31

30,7

97,0

Strongly Agree

3

3,0

100,0

Total

101

100,0

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

that when levels of procedural justice are high, the intention to leave; Voluntary

turnover, and absenteeism tend to be lower. The Pearson correlation was equal to -, 764

indicated a strong relationship between the two variables. Moreover, the significance

level was 0,000 which was also less than 0.05 and therefore indicated a high significant

relationship. This meant a regression analysis was to be performed.

Correlation 1: the relationship between procedural justice and organizational

attachment

Procedural Justice

Organizational

Attachment

Procedural Justice

Pearson Correlation

1

,879(**)

Sig. (2-tailed)

,000

N

101

Organizational Attachment

Pearson Correlation

,879(**)

1

Sig. (2-tailed)

,000

N

101

** Correlation is significant at the 0.01 level (2-tailed).

Correlation 2: the relationship between procedural justice and intention to leave

** Correlation is significant at the 0.01 level (2-tailed).

Regression Analysis 1: Procedural Justice and Organizational Attachment

Variables Entered/Removed(b)

Model

Variables Entered

Variables Removed

Method

1

Procedural Justice(a)

.

Enter

a All requested variables entered.

b Dependent Variable: Organizational Attachment

Model Summary

Model

R

R Square

Adjusted R Square

Std. Error of the Estimate

1

,879(a)

,773

,771

2,30515

a Predictors: (Constant), Procedural Justice

ANOVA(b)

Procedural Justice

Intention to leave

Procedural Justice

Pearson Correlation

1

-,764(**)

Sig. (2-tailed)

,000

N

101

Intention to leave

Pearson Correlation

-,764(**)

1

Sig. (2-tailed)

,000

N

101

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Model

Sum of

Squares

df

Mean Square

F

Sig.

1

Regression

1790,953

1

1790,953

337,044

,000(a)

Residual

526,057

99

5,314

Total

2317,010

100

a Predictors: (Constant), Procedural Justice

b Dependent Variable: Organizational Attachment

Coefficients(a)

Model

Unstandardized

Coefficients

Standardized

Coefficients

t

Sig.

B

Std. Error

Beta

1

(Constant)

8,645

,554

15,608

,000

Procedural Justice

,901

,049

,879

18,359

,000

a Dependent Variable: Organizational Attachment

According to the previous correlation table, a high significance was clear in both

relationships examined. Therefore, regression analysis was necessary to more explain

these relationships between Procedural Justice as the independent variable and the

dependent variables which are organizational attachment and intention to leave.

First regression analysis is done to elaborate the relationship between procedural justice

and organizational attachment. In the table of model summary, R square indicates the

percentage of change in the independent variable due to changes in the independent

variable. R square refers to the coefficient of determination, while R refers to the

correlation coefficient. In addition, to get this percentage of change, R square was

multiplied by 100%. The result was 77.3% indicating a 77.3% increase in the

organizational attachment among survivors when procedural justice increases.

Moreover, by calculating the difference between adjusted R-square and R square, the

degree of sample convenience can be obtained; the difference was (0.773-0.771 =

0.002), this small difference reflects that the sample was very convenient to examine the

tested relationship between procedural justice and organizational attachment. By

moving to the ANOVA table, it was shown that the ANOVA was equal to 0.000 which

indicated a significant relationship between the two variables; this significance was

clear as the ANOVA was less than 0.05. And finally, the equation of Y=Bo+B1.X was

indicated by the coefficient; in this equation, X refers to the independent variable

‘Procedural Justice’’, while Y refers to the dependent variable ‘‘Organizational

Attachment’’. The equation is: (Attach) = 8,645+ 0.901. (PJ).

Regression Analysis 2: Procedural Justice and Intention to leave

Variables Entered/Removed(b)

Model

Variables Entered

Variables Removed

Method

1

Procedural Justice(a)

.

Enter

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

a All requested variables entered.

b Dependent Variable: Intention to leave

Model Summary

Model

R

R Square

Adjusted R Square

Std. Error of the Estimate

1

,764(a)

,584

,579

1,66918

a Predictors: (Constant), Procedural Justice

ANOVA(b)

Model

Sum of

Squares

df

Mean Square

F

Sig.

1

Regression

386,684

1

386,684

138,787

,000(a)

Residual

275,831

99

2,786

Total

662,515

100

a Predictors: (Constant), Procedural Justice

b Dependent Variable: Intention to leave

Coefficients(a)

Model

Unstandardized

Coefficients

Standardized

Coefficients

t

Sig.

B

Std. Error

Beta

1

(Constant)

10,232

,401

25,510

,000

Procedural Justice

-,419

,036

-,764

-11,781

,000

a Dependent Variable: Intention to leave

By performing the regression analysis for the relationship between procedural justice as

the independent variable and the intention to leave as the dependent variable, it was

shown that R square ‘coefficient of determination’ which indicates the percentage of

change in the intention to leave due to changes in procedural justice was equal to 58.4%

obtained by multiplying (0.584*100%). This indicates a change of 58.4% in survivors’

intention to leave when procedural justice changes. Moreover, by calculating the

difference between adjusted R-square and R square, the degree of sample convenience

can be obtained; the difference was (0.584-0.579 = 0.005), this small difference reflects

that the sample was very convenient to examine the tested relationship between

procedural justice and organizational attachment. By moving to the ANOVA table, it

was shown that the ANOVA was equal to 0.000 which indicated a significant

relationship between the two variables; this significance was clear as the ANOVA was

less than 0.05. And finally, the equation of Y=Bo+B1.X was indicated by the

coefficient; in this equation, X refers to the independent variable ‘Procedural Justice’’,

while Y refers to the dependent variable ‘‘Intention to leave. Tthe equation is: (Intention

to leave) = 10,232-0.419*(PJ).

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

Beginning by the survey, the data analysis was performed using the SPSS, some tests

were conducted; there were the frequency tables which revealed some information

about the respondents. Afterwards, the correlation analysis was done to examine the

relationship between the independent variable of procedural justice and dependent

variable of organizational attachment and voluntary turnover. The correlation showed a

significance relationship between the variables in both cases. That is why the regression

analysis was further performed to reach a conclusion about the nature of the relation.

The regression showed a positive relationship between procedural justice and

organizational attachment, and a negative relationship between procedural justice and

voluntary turnover. These finding supported the hypotheses of the study; as it proved

that higher levels of procedural justice were associated with higher levels of

organizational attachment and less levels of voluntary turnover among survivors.

While the three follow up interviews revealed interesting insights about the perception

of employees about management fairness and the ways those survivors respond to

layoffs; the three respondents from NGO, public sector, and private sector all agreed

upon the lack of fairness in Egyptian organizations, and that performance was not the

major criterion shaping management decisions concerning employees’ dismissals or

promotions. It was revealed also how that some employees might have no proud by

belonging to their organizations. However, these survivors did not react negatively by

exhibiting less efforts or loyalty, and this was due to some religious beliefs which

encourage them to perform their duties no matter the return was. Moreover, it was

believed that even if the employee improved his/her skills and competences,

management would exploit the employee without proper compensation. However, one

respondent mentioned that an employee should always improve his/her performance to

reach better future job opportunities. This study confirmed the finding of previous

researchers who studied the impact of layoffs on survivors within organizations; it

confirmed the fact that layoffs generally affect survivors in negative ways. Moreover, it

did not conflict with previous researchers who stated that perceived organizational

justice had an important role in shaping and predicting survivors’ response to layoffs.

That is why the current study adds value to future researchers who might be interested

in studying this topic.

4.2 Implications

There are limitations in current research paper. Some of the limitations are related to the

methodology, and some others are related to the body of the literature. First, there

cannot be a generalization of results to Egyptian firms whether private sector, public

sector, or NGOs. As after all, one firm from each sector is not representative for the

whole sector with all its aspects, motivations, and desired outcomes of downsizing. It is

not possible to build a conclusion about all organizations in the three sectors just with

conducting one single study. Another limitation about the interviews, the number of

interviewees was small, and it was not enough to get one representative from each

sector to reach conclusions about the entire organization’s survivors. Moreover, the very

low response rate in public sector companies prevented the researcher from obtaining

more information about the nature of layoffs in public sector firms. In addition, the

sample is not large enough to draw such accurate and precise results about examined

variables; this means there should have been more coverage for the targeted sample of

organizational survivors to reach more generalizable and representative sample. Some

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

limitations which exist in the implementation of surveys as the sole research method; as

it is not possible to include all dimensions of the examined relation through some

questions in the survey. The deep nature of psychological aspects of human behavior

within their organizations can be better assessed through implementing some qualitative

research methods like direct observations, and case studies in more than one firm, or

even some focus groups which can be studied and noticed for some longer periods. But

this is not available in the current study for constraints which relate to time, costs, and

availability of technically skilled and professional staff and individuals who could help

in conducting the research in more professional and formal way. And finally, there

should have been more variables to measure to reach better conclusions about the

examined relation between perceived procedural justice and resulted survivor syndrome

negative symptoms. Unfortunately, only few variables are considered in the research

design due to time constraints, and the short nature of the survey which was used in the

study.

There are some future recommendations which can be useful for future researches on

the considered topic. Some of these recommendations are based on the limitations of

current study. First recommendation is about the sample size which needs to be larger in

future studies to be more representative. Moreover, the interviews should be more than

those three in the study; this is a necessity to obtain deeper insights about the examined

relation between organizational justice and survivor syndrome. The second

recommendation is about the number of variables which should be considered when

studying the examined relation; future researchers should develop and use more

measures to assess each variable in the study. In addition, some information could be

useful if added to the questionnaire; for example: monthly income is a factor which can

be useful when evaluating the reasons why survivors could remain with their

organizations; especially in the current research when about 28% respondent mentioned

that they mainly remained employed due to their financial need. This is an interesting

insight in a developing country like Egypt where people have low income levels and

low opportunities to choose among. And finally, future research should also focus on

both NGOs and public-sector companies; as some public sector companies are

privatized and the employees lost their jobs, also some NGOs still do not have their

rights like their counterparts in private sector.

5 Conclusion

The current research aimed at examining the impact of downsizing on surviving

employees within Egyptian organizations. The paper started with clarifying the logic

behind making Egyptian organizations the focus of the study. The research then

provided an introduction for the term downsizing, and how downsizing is not only

limited to personnel layoffs, but rather can include elimination of whole departments,

and organizational units. It was mentioned how many researchers had many

perspectives and aspects when they defined the word downsizing. It was explained how

downsizing differs from organizational decline; as downsizing is an outcome of

organizational decline or is considered as a strategy to face this organizational decline.

The factors which are affecting downsizing decisions were also listed along with

detailed explanation of how some external social and institutional factors affect layoffs,

in addition to some internal factors like organizational culture, and strategy. Then the

various approaches to it like reorientation and convergence were discussed with

The Impact of Workforce Reduction on Survivors in Egyptian Organizations

explaining how both approaches are different in terms of their causes and outcomes.

The research provided an overview of various downsizing strategies which are

workforce reduction, systematic strategies, and organization work redesign. It clarified

how those three strategies differed in terms of aspects, motivations to conduct them.

The three perspectives on downsizing which are the economic, institutional, and socio-

cognitive perspectives were also presented along with the relation among them. After

that, an overview on organizational survivors was presented; it included the definition

for survivors, their four types which are constructive, destructive, active, and passive.

The responses which are exhibited by survivors were deeply explained and they are

fearful, obliging, cyclical, and hopeful response. The different factors which shape

survivors’ responses were listed and they are distributive justice, procedural justice,

employee empowerment, trustworthiness in management, existence of clear

communications, and work redesign. Then the psychological effects of downsizing on

survivors were presented; the paper mainly examined three common phenomena which

occur among survivors, these phenomena are voluntary turnover, violation of

psychological contract, and survivor syndrome. It was explained how these three

outcomes are a result of declining organizational commitment and attachment of

survivors after downsizing occurs. Moreover, some figures were presented to provide an

overview about the linkage between the six factors which affect survivors’ responses

and other emotional and behavioral outcomes. Refer to Figures 2, 3 (Spreitzer and

Mishra, 2002).

In order to answer the research’s question ‘‘what the relationship between of procedural

organizational justice and survivor syndrome is?’’ a mixture of both quantitative and

qualitative methods was implemented. Data was collected from three Egyptian

companies; private sector, public sector, and NGOs. The study took about three months.

The sample included (n=101) survivors from mainly private sector companies and

NGOs. However, there was very low response rate in public sector because of the fact

that no pure layoffs occur there; employees rather are offered early retirement programs,

or they could be laid off through privatization which could make all employees lose

their jobs. Data analysis was performed using SPSS, and the findings supported the

proposed hypotheses of the research. Afterwards, some limitations which relate to both

the methodology and literature were discussed along with some recommendations for

future research concerning the relationship between procedural justice and survivor

syndrome.

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Examining the Impact of Workforce Reduction on Surviving Employees in the Egyptian Organization

Abstract and Figures