Web2GoTech decision for restructuring would bring many benefits to the company, by meeting their business strategics and initiatives.
Why did Web2GoTech decide to downsize?
Web2GoTech made the decision for restructuring and downsizing to improve efficiency. This was aimed at cost reduction and responding to market changes. Additionally, they focused on enhancing the overall organizational performance to increase the bottom line. On the other hand, employee impact will include changes in roles, responsibilities, and workforce size.
What are the benefits of restructuring?
- To decrease costs of the entire company’s operation, payroll expenses will be lower if staff are dismissed. Outsourcing labor can be cheaper than hiring full-time employees.
- Increased efficiency and communication – Restructuring often get rid of non-essential layers in the management chain. This opens the lines of communication allowing for increased efficiency and removes burdens on productivity.
- Increased operational efficiency – Adding new technologies would increase their operational efficiency. For example, introducing new business lines could make it easier and more efficient to increase productivity.
What are the disadvantages of restructuring?
- Loss of key skilled workers – this could result in a reduction in productivity. Reassigning the workload to another employee could lower the quality of work. It could also incur expenses in training for that employee.
- Drop in morale – Downsizing is a time of uncertainty for employees. With their jobs on the line, your business could suffer a drop in morale. Additionally, there could be higher levels of stress in your workforce. All of which leads to an unproductive work environment which could impact others.
- Re-training – If you are restructuring due to new technologies, you may spend extra money on training for your staff. There will be a drop in productivity as staff get used to the new technology.
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