Nowadays related to newspapers, magazines, radios and television programs are increasingly deal with organizational change. This is due to the competitive in the marketplace, globalization and technological advancement. To survive in the global market, organizations have to change themselves. Businesses that do not change will disappear while those who do will survive (Godin, 1999).
This essay will briefly summarize the report of restructuring nowadays in the marketplace, it will describe how the restructuring relates to human resource management and why restructuring is important for human resource managers to manage their employees during the period of restructuring.
"Restructuring involves a major change to an organization via downsizing, flattening, elimination of departments and so on" (Stone, 1998, P.835). Restructuring is basically changing the organizational systems. It can be in the various forms but the most familiar term is downsizing. "Downsizing or restructuring aims to achieve greater organization efficiency by job elimination" (Stone, 1998, P.585).
The corporate restructuring of organizations divided into two types: financial restructuring, and organizational restructuring (Cappelli et al, 1997). Bowman & Singh (cited in Cappelli, 1997) stated corporate restructuring refers to change in the company's financial structure, organizational form, or both. Financial restructuring refers to change in ownership, management buyouts and divestitures. Organizational restructuring refers to decentralization of authority, development of team, and downsizing of employment (Cappelli et al, 1997).
The two components have a relationship to each other. "At times, the financial component can drive the organizational changes; at other times the organizational component drives the financial changes" (Cappelli, 1997, P.44). .
According to The Australian on Tuesday March 6, 2001 reported, "President quits as Coke splits Four ways".