Corporate Restructuring: The Impact of Workforce Reduction on Success and Failure
27 Pages Posted: 18 Sep 2012 Last revised: 22 Sep 2012
Date Written: September 18, 2012
In this paper we examine the impact of workforce reduction on success or failure of corporate restructuring. Reduction in Contractual labor and Exempt workforce is studied with time horizon from restructuring event. Also, the percentage reduction and its impact on success or failure is studied. HR Managers of thirty companies who have gone under restructuring process during the year 2010-11 are surveyed for the study. We found that reducing workforce results in failed M&A, we also found that workforce reduction within first two months of merger increases the risk of failure.
Keywords: mergers & acquisitions, corporate restructuring, M&A, workforce reduction, layoffs, impact of workforce reduction, strategies to manage corporate restructuring effectively
JEL Classification: G34
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