DOWNSIZING IN A LEARNING ORGANIZATION: ARE THERE HIDDEN COSTS?

ORGANIZATIONAL learning; ORGANIZATION; BUSINESS; THEORY-practice relationship; DOWNSIZING of organizations; SOCIAL networks; LEARNING; ORGANIZATIONAL change; CHANGE management; KNOWLEDGE management

Business practice has been at odds with organizational theory: whereas one managerial "fashion"--downsizing--involves divestiture of human assets, another-- learning--advocates investment in human assets. We use a social network frame to consider the impact of downsizing on organizational learning and propose that the effects can be viewed as a nonlinear function of learning network size. From this perspective the potential damage to a firm's learning capacity is greater than headcount ratios imply. [ABSTRACT FROM AUTHOR]

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