Businesses that downsize in an attempt to become more flexible and
competitive must be careful not lose valuable knowledge in the process.
Rob Goffee, professor of organisational behaviour at London Business School,
told delegates at the Chartered Institute of Personnel and Development’s (CIPD)
HRD conference that laying off staff and introducing flexible working
arrangements can mean employers risk losing vital expertise and obstructing
information transfer between staff.
He urged employers undergoing organisational change to place a high
importance on knowledge management.
"The drive to become more flexible and competitive has advantages and
risks in the new economy," Goffee said.
"On one hand, organisations can be better equipped to deal with
competition with enthusiastic, high-performing workers pulling in the same
direction in a meritocratic system.
"On the other, organisations run the risk of destroying high morale,
the sharing of information and effective teamwork, which can be costly in
today’s knowledge-driven society."