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Downsizing in Healthcare: Causes, Consequences, and Employee Support Research Paper

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Introduction

The activity of any healthcare organization implies adopting significant, often quite critical decisions. These measures may involve both the introduction of new technologies and the introduction of changes in the human resources of the medical facility. Hence, one such change that requires careful research and evaluation is the downsizing of the working staff.

First of all, it is necessary to understand the phenomenon of downsizing in healthcare. Research states that it is when an employer decides to cut or remove jobs or positions (Langster & Cutrer, 2021, p. 330). It is worth noting that this measure does not apply to cases of voluntary dismissal or leaving the organization for retirement.

Downsizing does not always mean depriving an employee of a workplace; it also has such varieties as reducing work hours, eliminating positions, or consolidating departments. The choice of how to perform this procedure directly depends on the head and the conditions of the medical organization. Thus, introducing the initiative to reduce the organization’s employees has significant negative consequences for both the organization and the staff of the medical institution, which require special attention and the development of steps to support downsized personnel.

Reasons for Downsizing

Downsizing has many different reasons that can affect its implementation. Their consideration will provide a better understanding of this decision’s consequences for both the organization and patients. The most common reasons are economic, human, strategic, or developmental. For some organizations, cutting staff can be a life-saving solution in times of difficulty or crisis. That is why, before taking this initiative, it is necessary to consider the reasons that will justify this action.

Reducing Operational Spending

One of the main economic reasons for reducing the staff of a medical organization is the desire to reduce spending. Healthcare organizations may come to this decision in order to address budget constraints or to increase profitability (Ahammer et al., 2021). This may be because the hospital has economic difficulties with financing, which leads to the inability to pay salaries and maintain the organization.

Impact of Mergers or Acquisitions

Another economic reason is mergers or acquisitions of medical facilities. In this case, the hospital management merges with another organization, which requires a reduction in the number of specialists hired.

Impact of Technological Advances

Technological changes are the following reason for getting rid of some employees or changing the conditions and requirements of work. Advances in this field are of great importance for the field of healthcare. These innovations may include Artificial Intelligence and H-IoT systems that can replace human resources (Qadri et al., 2020). Thus, the creation of electronic patient records may entail the absence of the need for administration staff. Thus, ionization loses the need for some employees, which is why they are dismissed or reduced work activities. An equally important reason for staff reduction is a decrease in the number of patients.

Decreased Staffing Requirements

Healthcare organizations may experience a decline in patient volume, which can result in a reduced need for staff to serve them. In this case, the medical facility only loses financially, as it pays for the work of employees who do not provide health services. The strategic reason for changes in health policy, which, depending on the scale and severity, may directly affect the staff of a medical organization.

This aspect implies the introduction of programs that can reduce reimbursement rates, leading to cost-cutting measures, including the dismissal of hospital employees. New policies may also cause the need for reorganization or restructuring. These changes may affect the entire facility and some of its departments, which implies saying goodbye to employees to streamline operations and respond to changes in the healthcare landscape.

Consequences of Downsizing

After understanding the main reasons why an organization decides to downsize its employees, it becomes critical to consider the possible consequences. Like any other initiative for change, this measure can have both positive and negative results. However, the measure under study most often carries more negative results that require a close examination.

Decreased Access to Health Services

One of the main negative consequences of reducing the number of employees or the size of an organization is decreased access to health services. This aspect is the most critical for patients, leading to a decrease in the number of available medical professionals and healthcare providers or facilities available. This effect can be felt especially strongly by people from a low economic background who already have difficulties obtaining medical services.

Deterioration of Employee Satisfaction

Another negative consequence of downsizing is the deterioration of employee satisfaction and overall well-being. This is because individuals are under stress due to significant changes in the workplace or are afraid of being fired. The reduction leads to such consequences on the part of the staff as higher levels of role conflict, dysfunctional leadership, and employment insecurity (Frone & Blais, 2020).

In addition, employees may consider the decision of the authorities to be incorrect, which negatively affects the productivity and efficiency of the hired specialists. The leading consequence of the reduction for the organization is decreased efficiency and productivity indicators. This is because the remaining staff members may have to handle the additional workload. This circumstance may be the result of professional burnout, decreased productivity, and unwillingness to stay in the workplace.

Loss of Talented and Skilled Personnel

Another consequence may be the loss of talented and skilled personnel, the organization’s most valuable source. The excessive fullness of the hospital may cause the decision to say goodbye to these employees. Due to the dismissal of many employees or reduced working hours, the organization may face significant reputation damage.

This aspect is because downsizing has profound ethical implications that can cause dissatisfaction with society. Therefore, the implementation of downsizing measures in healthcare can have far-reaching consequences for both patients and healthcare organizations. It is essential for organizations to consider the potential impacts carefully and to implement measures to mitigate any adverse effects.

Supporting Employees During Downsizing

To maintain a positive workplace environment, the organization must take measures to support downsizing employees. This is because this measure seriously affects the well-being of individuals, causing stress, anxiety, disturbances, problems in personal life, and an increase in morbidity (Langsterand Cutrer, 2021).

Therefore, first, employers should develop a change management plan. Such drastic changes as reductions have serious consequences that need to be investigated and analyzed. These measures will help to correctly assess the possible consequences and how the organization will address them. Moreover, drawing up a change management plan can increase employee engagement and create a more positive workplace environment (Islam et al., 2021).

Furthermore, before proceeding to downsize employees, it is necessary to draw up a clear plan and form managers for the smoothest intervention. It should also include measures to prepare potential employees for redundancy, that is, the creation of a positive environment. The organization can provide staff with benefits and financial aid that will assist them in finding new jobs for the first time. The change management plan should also include communication with staff and transparency in the applied initiative. Managers should clearly identify the reasons for downsizing in order to gain awareness among employees. This action will also allow building of respect and trust between the managers of the organization and the individuals hired there to work.

Conclusion

In conclusion, a healthcare organization may face the need to downsize its employees, which can have severe consequences and requires carrying for downsized employees. This process involves getting rid of some employees, reducing working hours or professional powers and tasks of the staff. Such reasons may facilitate this circumstance as a reduction in spending, the introduction of new innovative technologies that replace human labor, or a decrease in the flow of patients.

However, this measure carries serious concerns, which are reflected in the deterioration of the reputation of the medical facility, and a decrease in staff satisfaction and work efficiency. In order to prevent these consequences, the health organization should develop a change management plan. The leading part of this initiative should be the support of workers who are undergoing downsizing. This necessarily implies a training of personnel, training of managers, and finding solutions to negative consequences. Thus, despite the undesirable outcomes of downsizing, some companies need to implement this measure, which requires careful preparation.

References

Ahammer, A., Grübl, D., & Winter-Ebmer, R. (2021). . IZA Discussion Paper, (13984). Web.

Frone, M. R., & Blais, A. R. (2020). . International Journal of Environmental Research and Public Health, 17(3), 719. Web.

Islam, M. N., Furuoka, F., & Idris, A. (2021). Global Business and Organizational Excellence, 40(3), 50-62. Web.

Langster, H. J., & Cutrer, S. (2021). . JONA: The Journal of Nursing Administration, 51(6), 329-333. Web.

Qadri, Y. A., Nauman, A., Zikria, Y. B., Vasilakos, A. V., & Kim, S. W. (2020). . IEEE Communications Surveys & Tutorials, 22(2), 1121-1167. Web.

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IvyPanda. (2024, October 21). Downsizing in Healthcare: Causes, Consequences, and Employee Support. https://ivypanda.com/essays/downsizing-in-healthcare-causes-consequences-and-employee-support/

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"Downsizing in Healthcare: Causes, Consequences, and Employee Support." IvyPanda, 21 Oct. 2024, ivypanda.com/essays/downsizing-in-healthcare-causes-consequences-and-employee-support/.

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IvyPanda. 2024. "Downsizing in Healthcare: Causes, Consequences, and Employee Support." October 21, 2024. https://ivypanda.com/essays/downsizing-in-healthcare-causes-consequences-and-employee-support/.

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IvyPanda. "Downsizing in Healthcare: Causes, Consequences, and Employee Support." October 21, 2024. https://ivypanda.com/essays/downsizing-in-healthcare-causes-consequences-and-employee-support/.

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