Firms use downsizing as a restructuring strategy for different reasons,but the most frequently cited one is:
A) poor unit performance from decreasing industry attractiveness.
B) decreasing market share from increasing industry competition.
C) shifting industry characteristics.
D) an expectation of improved profitability from cost reductions and more efficient operations.

Question

Quizplus · Accepted Answer

Downsizing is often used as a cost-cutting measure in order to improve profitability and efficiency. By reducing the number of employees and focusing on core competencies, firms hope to improve their bottom line. While other factors such as industry competition and shifting industry characteristics may also play a role, the most frequently cited reason for downsizing is cost reduction.

Firms Use Downsizing as a Restructuring Strategy for Different Reasons,but