Published on 2014/10/14
Differentiating “Efficiency” and “Downsizing”
Efficiency-related changes often don’t translate to downsizing, but simply a different way of doing a job. However, poorly communicating this difference could have a negative impact on executives and staff alike.
The following email Q&A is with Ken Udas, deputy vice chancellor and chief information officer at the University of Southern Queensland. Udas is a leader in postsecondary technology transformation, and has been exploring the intersection of technology and higher education throughout his career, a process that has led him to implement a number of efficiency-related changes. In this Q&A, he addresses one of the biggest concerns many individuals have when the specter of efficiency is raised: “What about my job?”

Click here to read key takeaways.

1. Is it fair to equate efficiency-related changes and process streamlining with layoffs?

Not necessarily. It really depends on the nature of the changes, the designed outcomes, the staffing profile and the size and complexity of the entire organization. Not wanting to state the obvious, but efficiency speaks to both cost and productivity. If we’re able to become more productive within the same staffing budget, then we could be looking at a staffing budget that is stable, even if the profile needs to change. Now, it might mean the university needs to invest in professional development for team members who need to acquire new skills. In this case, it’s possible that there are layoffs, but the employee has options and involvement in their choice. If the organization is large enough, there may also be opportunities for reassignment within the organization if the team member fits well in the organization more generally.

Things are changing in the sector. For example it’s not at all unheard of for universities to bring resources once outsourced back in-house to achieve longer-term cost savings, increased control and improved performance. In this case, we may see “streaming” actually increasing internal spending and resourcing, while the vendor needs to consider reassignment or layoffs. Another scenario might include a university partnership with a vendor, consortium or another university in which resources are pooled and staffing is transferred or reassigned to another organization related to the university.

At the end of the day, a good organization wants to make room for good people and will actively seek options. Frequently, reorganizations resulting from streamlining or simply realigning efforts are used to re-profile the staff and, in this case, a layoff may be about organizational fit as much as efficiency. Well-managed organizations of significant size will also frequently go through regular voluntary severance exercises that will allow astute managers to re-profile in an incremental way, thereby reducing the need for traditional layoffs.

So, no, although layoffs may result from efficiency-related changes, it’s not necessarily the case and, if at all possible, it should be done relatively surgically. This discounts the times when whole business units are being removed from the organization or when financial conditions get so bad there are no other options. All that being said, those circumstances should rarely be surprises and, once again, in a well-managed organization, there are ways to mitigate the personal and professional impact of forced redundancy.

2. Why are such changes so often equated to downsizing?

Most organizations are not designed or managed for flexible staffing, so they get surprised and are left with few options. Obviously this is not always the case, but many times, when you dig into it, it’s because the management allowed too much organizational “deferred maintenance” to accrue. I’m not suggesting anybody takes downsizing lightly or looks at it as a first or desirable option, but frequently it’s the option that requires the least creativity.

I want to assert here that I’m speaking principally about administrative, service, professional and managerial roles and function, not academic appointments, which is a rather different discussion.

3. What are some of the true impacts efficiency-related changes can have on staff and faculty?

It’s important to recognize the impacts are frequently quite personal, so it’s difficult to generalize. When the situation becomes serious for an individual and they’re forced into difficult choices, the impact can be devastating for a variety of reasons. On the other hand, depending on the circumstances, the individual may find they rise to the occasion and can reinvent themselves within or outside of the organization in very positive ways. This is not about “sugar coating” the reality; it’s about how different people react to challenging situations and about personal resilience.

Organizations have a role in this as well. They can be honest and direct and can make opportunities available in a variety of ways. If done poorly, the impact on everybody in the organization can be profound and long-lasting, which may result in erosion of community, academic governance and the experiences we’re able to provide to our learners.

As an important note, downsizing and re-profiling, particularly in areas of academic staffing, can be confused. There’s been a very well documented trend in American higher education to shift tenure-tracked and tenure-bearing staffing lines to contingent faculty. Although there has been growth in fixed-term contracted academics, the most significant growth has been in adjunct appointments. Although the shift may be tied in some way to streamlining, it’s probably more closely connected with simple cost reduction and the managerial impulse to shift cost from fixed to variable. This trend has profound impact not only on individuals, young scholars in particular, but it has broader impact on the nature of a scholarly community. It can weaken academic governance, the focus on scholarship more broadly and perhaps the capacity for resilience that universities have shown historically. This may be one of the more profound “true” impacts efficiency-related changes can have on professional staff and faculty.

4. How can higher ed leaders ensure their staff and faculty are comfortable with process streamlining?

There is the question you asked, and then there are at least two major components that need to be addressed as well.

First, your question: at the end of the day, it’s about honesty, courage and transparency. The process needs to be clearly articulated and discussed. That discussion needs to be a dialogue and there needs to be an understanding among all those involved that we all have constraints. For example, frequently, the process needs to take a particular shape or have particular components due to compliance with laws, policies, governance articles, community standards and/or enterprise or collective bargaining agreements. Unfortunately even well-meaning managers can get caught up in an exaggerated risk-sensitive posture and decide to reduce transparency to reduce perceived risks, while perhaps unknowingly adopting other, perhaps more profound, risks for the organization. How this unfolds is a real test of character for the organization.

I know that this does not help much, but most of us know what we ought to do and most of us know what our organizations do to make us both proud and embarrassed. It is a matter of fortitude to responsibly act in ways that make us proud. After all, in most university cultures we’re talking about our colleagues.

Now for the other two components.

First, how can higher education leaders ensure their staff and faculty are comfortable with the reasons for streamlining?

Second, how can higher education leaders ensure their staff and faculty are comfortable with the execution of the streamlining process?

The first issue is really about the culture of the organization. If governance is robust and healthy, there will have been many discussions over an extended period of time. Although there will likely be disagreement about the reasons and the actions, there should be no surprises and everybody should have been provided with opportunities to contribute their voice to the discussion, it should have been heard and there should be some, at least implied, rationale for why it was or was not acted on. So, this might not result in universal comfort or agreement, but it should result in understanding and a clear rationale for acceptance.

The second issue is about organizational performance, attention to detail, fidelity to values and the delivery of commitments. Many universities are not designed for, or support a culture that does a great job, streamlining. At the very heart of the university is the notion of collegiality, which transcends codification of behavior and decisions, but the latter is exactly what’s needed in the contemporary university confronted with the need to execute on a non-trivial managerial decision. This points us back to the argument about the nature of the corporatized university, which is an important and related discussion. After all, we could just as easily be addressing this from the perspective of an organization in which the faculty and students make decisions about organizational efficiency, which would significantly change the nature of this discussion.

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Key Takeaways

  • As long as an institution’s governance culture is strong, and changes are communicated effectively, staff and faculty should fully understand the nature of the changes taking place.

  • The impact of poorly-executed efficiency-related changes can be personal, long-lasting and lead to the erosion of institutional collegiality.
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Readers Comments

Peggy Awning 2014/10/14 at 11:24 am

Udas brings up one of the key challenges in managing staff during a reorganization, which is the lack of a “flexible staffing” strategy at most institutions that undergo change. The impact is felt not only by staff, who demonstrate concerns about their job security and responsibilities, but by institutions, which need staff to quickly adapt post-reorganization. Every institution should have a flexible staffing strategy when considering a change process.

    Ken Udas 2014/10/19 at 7:41 pm

    Peggy,

    I agree entirely and would suggest that flexible staffing approaches require ongoing attention. It is really more of a strategy than an activity. I have worked at an organisation (university) that employed a voluntary severance approach that supported incremental reshaping of the structure. This is not a euphemism for laying folks off. It is about re-profiling the structure and roles in the organisation. It only really works if there are good lines of communication and clear indications (honest and direct) of the direction of the organisation. Combining these elements, a team in my area has done a remarkable job shifting from supporting a distance learning model that was established more than two decades ago, into one that now facilitates a very different model requiring very different skills. In addition to structural changes and communication, the university (along with the team) has also invested in professional development, training, hiring, and mentoring activities to support team members who want to make the transition.

    Thanks for your contribution!

    -Ken

Ian Mulder 2014/10/14 at 3:17 pm

Clear and honest communication is key during a reorganization period. From experience at my previous university, I agree with Udas that increasing efficiency often means expansion rather than downsizing. However, it’s important not to over-promise this. As you move through a change process, units you might have thought to leave alone may end up having to reorganize and, to put it bluntly, staff might be lost along the way, even as some are moved to different roles and new staff are hired. Clear communication about the possible outcomes of reorganization at the outset can mitigate staff impact later on.

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