Middle Managers' Commitment to Change after Downsizing

Evi Kurniasari Purwaningrum

1,2

, Fendy Suhariadi

, and Fajrianthi

Faculty of Psychology, Universitas Airlangga

Faculty of Psychology University of 17th August 1945 Samarinda

Keywords : Organizational Changes, Qualitative, Survivor.

Abstract : This research was a case study of middle managers' commitment issues after downsizing. After downsizing,

the company kept changing its regulations to compete. Less appropriate change strategies led to uncertainty,

pressure and anxiety among middle managers. This research aimed to explore the way middle managers

handle and commit to changes under pressure. During the organizational change periods, the roles of middle

managers were complex because they were required to become agents of change and targets of change. These

roles severely affected the implementation of changes. This research applied qualitative methods through a

case study by interviewing individuals and conducting focus group discussion. There were eleven middle

managers and three general managers who were considered as significant others. It was found that the middle

managers, who were also the survivors, felt satisfied and gained fairness in the downsizing process. However,

after the downsizing, the organization was less committed to change, so the managers showed commitment to

change because they felt obligated (normative commitment to change) and they had no choice but to follow

the change (continual commitment to change). This paper also helped to understand how the commitment to

organizational change influenced survivors’ commitment to change.

1 INTRODUCTION

Downsizing has been a serious issue in Indonesia for

the past three years and has affected a large number of

workers. Based on data from the Ministry of

Manpower of the Republic of Indonesia, (2015, 2016,

2017) 26,506 workers were terminated in August

2015, which increased by 84.2% in December 2015

(48,843 workers). There were 12,777 employees

terminated in 2016, and the number decreased to

9,822 in November 2017. Three provinces with the

highest employment termination cases were East

Kalimantan (3,088 workers), Jakarta (1,939 workers)

and Banten (1,663 workers). According to the

Indonesian Workers Welfare Union, this phenomenon

represented a massive case of downsizing (Hidayat,

2016).

The main cause of downsizing in Indonesia was

the slowing of global economic growth that affected

the economic condition in Indonesia. Downsizing

was commonly implemented by organizations due to

global economic conditions, which was preceded by

recession or politic instability (Chipunza & Berry,

2010). Many organizations chose downsizing to

increase their efficiency (Datta & Basuil, 2015;

Kwoske et al., 2009), so they could become more

competitive (Chipunza & Berry, 2010; Marques et al.,

2014).

Downsizing was often perceived as a shortcut to

improve the organizations’ performance, while in fact

downsizing often failed to accommodate the desired

economic outcome (Datta et al., 2010). Downsizing

also led to a serious problem called survivor quality

(Chipunza & Berry, 2010). Survivors were

employees who were not affected by layoffs, while

survivor quality was characterized as the workers’

attitude, commitment and motivation in the new

work situation after downsizing (Vinten & Lane,

2002). It was difficult to see the survivors’ behaviors

and motivations as the consequences of downsizing

(Datta & Basuil, 2015). The success of an

organization depended on the survivors' attitude,

commitment and enthusiasm to work (Chipunza &

Berry, 2010). Therefore, the organization needed to

ensure that the survivors maintained their

commitments, perceptions of job security, creativity

and motivation (Marques et al., 2014).

Research on the impact of downsizing on the

commitment of the survivors had been widely

studied, but each study had different results. For

108

Purwaningrum, E., Suhariadi, F. and Fajrianthi, .

Middle Managers’ Commitment to Change after Downsizing.

DOI: 10.5220/0008586001080114

In Proceedings of the 3rd International Conference on Psychology in Health, Educational, Social, and Organizational Settings (ICP-HESOS 2018) - Improving Mental Health and Harmony in

Global Community, pages 108-114

ISBN: 978-989-758-435-0

 2020 by SCITEPRESS – Science and Technology Publications, Lda. All r ights reserved

instance, a research found that downsizing lowered

an organization's commitment (Allen et al., 2001;

Brockner et al., 2004; Travaglione & Cross, 2006),

while other research found that downsizing

increased an organization's commitment (Bergström

& Arman, 2016; Chipunza & Berry, 2010).

Commitment was a driving-force behind an

organization's performance, and it was essential for

organization productivity (Travaglione & Cross,

2006). Organizations depended on the workers'

commitment and dedication (Chipunza & Berry,

2010).

In the context of organizational change,

survivors' commitment to the organization was not

enough. Survivors were required to have

commitment to change. Compared to organizational

commitment, commitment to change had a bigger

impact on behavior that supported changes

(Herchovich & Meyer, 2002). Commitment to

change was a key success predictor for the

implementation of behavior that supported change

(Meyer et al., 2007; Seo et al., 2012; Shin et al.,

2015).

In order to support the success of

post-downsizing changes it was important to find

individuals who had important roles in the success

of change. Middle managers were important assets

in building organizational strategy and

implementation of organizational change

(Ashkanasy & Humphrey, 2011; Rouleau & Balogun,

2011). Middle managers had five roles during the

period of change, which were as communicators,

supporters, trainers, mediators and managers of

resistance (Ionescu, Merut & Dragomiroiu, 2014), to

be agents of change and targets of change

(Giangreco & Peccei 2005; McConville 2006; Floyd

& Lane, 2000). Middle managers' roles during the

period of change were challenging as they were in a

position that must fulfill many expectations and

balance responsibility (Sims, 2003).

Downsizing would also affect middle managers

as survivors, but they were required to demonstrate

their professionalism by performing their roles

during the period of change. This research was

conducted on companies experiencing downsizing in

Indonesia. After downsizing, middle managers were

satisfied with the process, but they did not show the

expected work performance. This condition was

different from a study (Bergström & Arman, 2016),

which found that the survivors' organizational

commitment was increasing after the downsizing

process because the workers' program was well

communicated.

This research was expected to fill in the

shortcomings of the previous studies that examined

the commitment in general after downsizing, while

focusing on the commitment to change. This study

explored the middle managers' commitment to

change after downsizing, so it was expected to

explain why the downsizing could increase or lower

their commitment to change.

2 METHODS

A qualitative method with a case study approach was

employed in this study by involving survivors with

mid-managerial positions in PT KSE Indonesia. PT

KSE was a company engaged in engineering and

construction, property, concrete and trading. Over

the past two years, the company had conducted three

large layoffs due to external environmental pressures,

during the economic crisis. Post-downsizing resulted

in various changes for the company, such as

restructuring, and changes in working procedures

and culture. The data was obtained from 11 middle

managers (two women and nine men), and three

division heads as significant others.

The data was collected by conducting focus

group discussion (FGD) and semi-structured

interviews. Focus group discussions and interviews

were conducted by giving open questions but there

were limitations to the theme and flow of the

conversation. There were interview guidelines that

were used as a benchmark in the plot. Interview

guidelines were prepared based on Herchovich and

Meyer’s (2002) commitment to change theory.

Three division heads (head of middle managers) and

three middle managers participated in the interviews,

which were of 90 to 120 minutes interview duration

with an average interview time of 100 minutes. On

the other hand, eight middle managers were

involved in the FGD, which took around 120

minutes. All data was recorded electronically and

transcribed.

Boyatzis’ theory-driven thematic analysis (1998)

was used to analyze the data, while Herchovich and

Meyer’s three dimensions of commitment to change

theory (2002) was used as the core theory. Seven

data analysis steps were conducted: making a

transcript, determining the code that would be used

with reference to the theory, reducing the code in the

appropriate themes, matching the data with the

theme and code that had been determined, making

an evaluation, interpreting the results and drawing

conclusions.

The eight strategies proposed by Cresswell and

Miller (2000) were employed for validity test. The

Middle Managers’ Commitment to Change after Downsizing

109

strategies recommended the writer to include at least

two procedures in any studies. In this study, review

procedure and question-answer with colleagues as

well as examining the participants were the methods

to validate the data. Examination was carried out by

collecting participants’ views on the credibility of

the findings and interpretation.

3 RESULTS

Commitment to change was a reflection of how a

middle manager felt, being tied to change and

seeking to make a change successful. The results of

data analysis showed that the survivor’s

commitment to change was formed through a

process. Broadly speaking, the development of a

survivor’s commitment to change was motivated by

two different factors. There were survivors who felt

responsible for supporting the organization, so that

the organization could survive and be more

competitive. There were also survivors who

supported the change because they did not want to

be dismissed from the company. In order to

understand the survivors’ commitment to change,

the authors explained middle managers’

post-downsizing experience that influenced

development of commitment to change.

As survivors, middle managers assessed that

downsizing conducted by the organization was a

necessary step in an organization's effort to survive

in difficult situations. Middle managers also felt

satisfied with the way downsizing was conducted by

the organization, because it was considered to be fair.

The organization implemented downsizing in two

ways: (1) providing an offer to employees for early

retirement and (2) selecting employees for early

retirement based on work performance. In addition,

middle managers could also understand the reasons

for the organization downsizing. They also felt

grateful for being retained by the organization. They

said that they would work better for organizational

survival.

The company restructured and conducted

organizational change after downsizing. There were

many new positions, but without job descriptions. Its

organizational structure was also leaner with higher

workloads, but there were also departments that had

excessive personnel numbers. The middle managers

rated this change as a positive step. The middle

managers also had awareness to support the change.

This awareness grew because the company often

conducted socialization about the importance of

support of all parties to succeed in the change

In the implementation stage, however, the middle

managers felt confused. They occupied new

positions that did not have job descriptions yet. They

were still adapting and guessing their responsibilities,

while at the same time they were required to make

improvements in their working units. The middle

managers should also ensure that their subordinates

could keep up with the changes. They considered the

organization was not formulating appropriate

strategies, so that changes were unplanned.

The conditions experienced by middle managers

made them feel depressed about the changes. There

were six factors causing this depression: (1) heavier

workload; in addition to routine duties, middle

managers received new tasks related to changes such

as making SOPs, formulating new work strategies

and improving work unit performance; (2) less

supportive personnel; downsizing reduced the

number of personnel in a working unit, there was

also a large number of personnel that only mastered

one particular task but were less able and willing to

handle other tasks; (3) higher organizational

demands on their performance; (4) threat of layoffs,

the possibility of layoffs for those who could not

meet the demands of the organization; (5)

insufficient competency, middle managers felt the

lack of adequate competence for new positions, and

their subordinates’ competence was also inadequate;

and (6) lack of role models, as the superior only

issued commands but did not show commitment in

the implementation of change.

The following interview excerpts illustrate the

psychological condition and stress-causing factors:

“At this time, I really feel depressed.” (DN)

“Sometimes I feel overloaded. My workload and

corporate demands are getting increased.”(JH)

“The company is now demanding a lot of us. It is

like we are still learning to walk but we have been

required to run.” (NB)

“We do not see the seriousness of the company.

This is slowly lowering my confidence in the

company.” (FR)

“What is needed now is a real example from the

boss, not just commands. As subordinates, I feel that

we are only required to change the way of work,

efficiency, breakthrough, but sometimes the company

lacks clear direction, what kind of strategy that

make us confused. And the management itself does

not have a strong commitment to change. So, it's

useless if it’s only us that have to commit.” (RN)

The results of the data analysis also showed that

there was a difference in interpreting the perceived

experience during the process to change. There were

survivors who perceived their confusion and feelings

ICP-HESOS 2018 - International Conference on Psychology in Health, Educational, Social, and Organizational Settings

110

of distress only temporarily because at the time the

organization was experiencing a transition period.

This period would soon pass if all parties supported

the goals and the organization formulated a clear

direction and strategy for change. How survivors

perceived the experience during a time of change

brought an obligation to always support

organizational change. As part of the organization,

the middle managers felt responsible for showing

their responsibility. This was reflected in the

following interview excerpts:

“I am grateful to be trusted by the company,

therefore I have a responsibility to support the

company's efforts to move forward. And it has

become my duty to work better, including supporting

the change in the company.” (FD)

“For me, work is a form of worship. It has to be

done whether it’s easy or hard, including supporting

the company that is currently making changes to be

more competitive.” (JH)

“Actually, I feel I cannot deal with the current

changes. But since it is part of my duty, I have to do

it. In my understanding, supporting this change

strategy is an obligation of all employees, including

me." (NB)

"Although I see the direction of corporate policy

is still less clear, I understand this is the company's

efforts to survive. Therefore, I must support this

change policy." (SD)

"At first, I disagreed with the company's policies

that were currently doing a lot of changes. But

because of my position as a manager, I have to be an

example for my staff by supporting the change."

(SH)

"It is an obligation for all employees to

implement the company's policies, including

changes. After all, I have been working here for so

long, so whatever the company policy, I must

support it, because it’s for the good of the company

and employees.” (RN)

Furthermore, this study found some forms of

support from middle managers towards the change:

(1) being open minded towards the change; (2)

improving self-competence by self-studying or

training; (3) proposing ideas for improvement of

their unit performance; and (4) persuading

co-workers and subordinates to support the change.

Some survivors considered that the perceived

pressure and confusion were the results of

organization inability in making change. The

organization had not yet showed consistency in

making improvements. The leaders were also unable

to become role models to implement the change.

This led to the disappointment of the middle

managers. Five participants were willing to support

the change because they still wanted to work for the

company. They were afraid that if they did not

support and implement the changes they would be

punished or even fired by the company. The

following are some statements by the participants:

“For now, I haven’t found another job. Even

though I feel uncomfortable, I try to carry out the

rules and policies of the company. One of them is

supporting the changing programs of the company.”

(FR)

“Actually, I feel pressured with my new jobs.

They aren’t in accordance with my passion and I’m

also not happy with my current position. I feel more

comfortable to do my previous jobs. Moreover, there

are many new rules and policies made by the

company. Before we can carry out the old rules, the

new ones have been already made. But I have no

choice. As long as I still work here, I will try to be

professional by supporting the change.” (DN)

“I try to carry out all of the duties very well,

including following the new rules. I also try to

propose ideas if needed. I still want to work for this

company.” (YH)

“I have been working in this company for a long

time. I also want to work until I retire. Actually, it is

a little bit hard if I have to follow the current

workflow, but I will carry out the demands of this

company.” (RJ)

“I have no other choice. I prefer to survive in

this company than being fired. Of course, I have to

work harder because nowadays the company is

aggressively doing efficiency and other changes.”

(RN)

The statements above showed the form of

support given by middle managers to the

organization, despite their reason for wanting to

keep working there: (1) being involved in the

company’s changing programs; (2) being

professional by following the changes; (3) providing

ideas; and (4) following the new rules.

4 DISCUSSION

The findings of this research illustrated the

commitment to change of middle managers who

become the survivors. Initially, all participants were

willing to support the change, but in the phase of

implementation after downsizing, their reasons for

support differed from each other. Some managers

were committed to change because they felt

obligated and responsible for supporting the change.

Meanwhile, other managers had no choice but to

Middle Managers’ Commitment to Change after Downsizing

111

support the change. The difference in motivation to

support the change of the organization was a

different form of commitment to change. According

to Herchovich and Meyer (2002), feeling obligated

and responsible was a form of obligation-based

commitment called normative commitment to

change, while feeling no other choice but to support

the change was a form of cost-based commitment

called continuous commitment to change.

Previous studies found that the antecedents of

normative commitment to change reflect the positive

assessments of organization: quality of relationships

with managers, job motivation (Parish et al., 2008);

trust in management, quality of change

communication (Soumyaja et al., 2011) and

perception of organizational support (Naotunna &

Arachchige, 2016). Normative commitment to

change was also negatively correlated with

emotional exhaustion and aggressive voice (Jing et

al., 2014). However, it was positively correlated with

discretionary forms of behavioral support

(cooperation and championing) (Meyer et al., 2007),

individual learning, implementation of success and

improved performance (Parish et al., 2008).

Continuous commitment to change developed

when the employees believe that they were missing

something (Herchovich & Meyer, 2002). In this

research, it was found that middle managers felt

pressured to support the change. They felt that there

was no other choice but to support the change. The

risk that they faced for not supporting the change

was the likelihood of being fired by the company.

Moreover, the leaders did not fully support the

change and were unable to be the role models to

commit to the change. This finding was consistent

with a study showing that the organization’s

environmental conditions were negatively correlated

with continuous commitment to change. Fairness in

an organization was negatively related to continuous

commitment to change (Paolillo et al., 2015).

Quality of relationships with managers and work

motivation were negatively related to continuous

commitment to change (Parish et al., 2008). The

perception of organizational support had a negative

effect on continuous commitment to change

(Naotunna & Arachchige, 2016). The middle

managers who perceived negative environmental

conditions of the company eventually showed

continuous commitment to change. Continuous

commitment to change was negatively correlated

with discretionary forms of behavioral support

(cooperation and championing) (Meyer et al., 2007),

individual learning, implementation of success and

improved performance (Parish et al., 2008)

The finding of this research was also expected to

explain whether downsizing decreased or increased

commitment to change. Previous studies found that

downsizing increased the commitment of the

organization because the survivors were satisfied

with the downsizing process (Bergström & Arman,

2016; Chipunza & Berry; 2010). This research also

found that the survivors were satisfied and felt the

fairness in the process of downsizing. However, in

the process after downsizing, the organization was

unable to commit to making changes. Hence, the

survivors felt pressured and confused.

Out of the three dimensions of commitment to

change, only normative commitment to change and

continuous commitment to change were found in

this research. Whereas, in previous study, affective

commitment to change was found to have the

strongest positive correlations and was strongly

consistent with behaviors that support the initiative

to change (Herscovitch & Meyer, 2002; Meyer et al.,

2007; Morin et al., 2016). Thus, if the company

wanted to succeed in making changes, the middle

managers should have had a strong affective

commitment to change. The absence of effective

commitment to change in middle managers was

because they had less positive feelings about the

condition of the company. Naotunna and Arachchige

(2016) stated that the positive condition of an

organization resulted in an effective commitment to

change.

5 CONCLUSION AND

SUGGESTIONS

The findings showed the importance of developing a

positive atmosphere during times of change. The

positive atmosphere developed by the organization

at the beginning of change did not affect the

effective commitment change sufficiently; therefore,

a positive atmosphere must be developed sustainably.

The organization had a major role in developing a

positive atmosphere by showing its commitment to

change and top management could be role models in

change.

As for the practical implications based on the

findings of this study, the researcher proposed

several suggestions for the organization: (1) the

organization must have the knowledge and strategies

on how to treat employees, especially middle

managers after the downsizing phase; (2) the

organization must set goals, plans and strategies for

the changes that are communicated well to all

ICP-HESOS 2018 - International Conference on Psychology in Health, Educational, Social, and Organizational Settings

112

employees; (3) the leaders of the company should be

the role models who can be truly committed to

change.

The limitation of this research was the

generalization, because the data was collected from

participants from one company. In addition,

qualitative research was not designed to generalize

across populations. Future research is recommended

to use quantitative research methods using a sample

of middle managers who come from various

companies that experience downsizing.

Data collection methods using focus group

discussions also had limitations, such as the

response of one participant could influence the

responses of other participants, especially if there

were more dominant participants. Research using

focus group discussions is recommended to use FGD

rules in an ideal manner so that the data obtained is

more accurate.

ACKNOWLEDGEMENT

This research received no specific grant from any

funding agency, commercial or not-for-profit

sectors.

DECLARATION OF INTEREST

The authors report no conflicts of interest in this

work.

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