Downsizing At AT&T

During the 1990s, most Fortune 1000 firms in the United States have engaged in downsizing (Kets de Vries & Balazs, 1997). Further, the trend appears to be continuing. The ardent positions on each side of the downsizing phenomenon justifies the interest in downsizing as a research focus. Because the American Telephone & Telegraph Company (AT&T) is a giant corporation and because the company is highly profitable, questions arose in relation to both motivations and possible outcomes when the company announced a massive downsizing initiative in 1995 that involved the elimination of 40,000 jobs (Norris, 1995). These questions motivated the selection of AT&T as the company for the focus of research on the downsizing issue.

During the 1990s, threats have emerged in AT&T's external environment in the form of likely new laws, probable competition new rivals, and rapid changes in technology (Arnst, Spiro, & Burrows, 1995). The company also faces a threat within its in its internal environment in what AT&T management view as laggard performance in comparison with the company's major competitors ("AT&T's Three-Way Split," 1995). These factors were major motivations for the company's decision to initiate a downsizing strategy. AT&T management was beginning to become aware of some of the symptoms of decline that precede the collapse of major corporate institutions (Luffman, Lea, Sanderson, & Kenny, 1996).

. . .
may have "undermined the faith of established corporate employees and executives, many of whom are leaving to embark on entrepreneurial endeavors" (Ettorre, 1997, p. 47). Further, a 1996 poll of college seniors revealed that 51 percent of male respondents and 31 percent of female respondents were most attracted to "entrepreneurial possibilities, as opposed to organizational positions where they would be subject to downsizing at some future time. Such results indicate that the traditional corporate structure is threatened by both the departure of seasoned executives and the unwillingness of many young and bright prospects to serve an entity in which they perhaps place little or no faith" (Ettorre, 1997, p. 47). Many corporations also have been charged with age discrimination associated with their downsizing programs (Verespej, 1997). While many corporations have attempted to use performance measurements as a justification for their downsizing selection decisions, most such corporations have not been able to support such contentions in hearings and court proceedings. The general tendency is to perceive downsizing in the context of significant personnel reductions and organizational restructuring throughout an organization. In
. . .

Some common words found in the essay are:
Krishnan Thompson, Vries Balazs, AT&T CEO, NV Heller, Approach Analysis, AT&T Breakup, McCaw Cellular, Ma Bell, Sanderson Kenny, Downsizing AT&T, kets de, de vries balazs, balazs 1997, vries balazs 1997, de vries, kets de vries, vries balazs, downsizing initiative, krishnan thompson, thompson 1992, shani grant krishnan, krishnan thompson 1992, shani grant, schwind 1997, grant krishnan,
Approximate Word count = 3703
Approximate Pages = 15 (250 words per page)

More Essays on Downsizing At AT&T