Downsizing the university: bonne chance! Steven H. Appelbaum John Molson School of Business, Concordia University, Montreal, Quebec, Canada Eric Patton PhD Programme in Administration, John Molson School of Business, Concordia University, Montreal, Quebec, Canada Over the last decade, downsizing has become the preferred route to improve efficiency for North American organizations (Morris et al., 1999). In fact downsizing has become the norm rather than an exception practiced by only a few organizations in trouble (Cameron and Smart, 1998). The trend towards leaner organizations in the name of reducing waste, increasing speed and lowering costs has had a profound effect on the way organizations work and on the collective psyche of North America’s workforce. In the late 1980s and early 1990s, downsizing was a response to the economic downturn that characterized that period (Minda, 1997). However, downsizing has continued in the mid to late 1990s despite a booming economy (Laabs, 1999). Furthermore, as downsizing has become common in North American business practices, it has spread to the public sector, including higher education. As the trend towards ``getting smaller’’ spreads like wild fire across all industries, that line between downsizing and maintaining an organization’s primary raison d’e Ãtre has become increasingly blurred. As a result, downsizing has not been overly successful for many organizations and has, in fact, led to many new and very serious problems. Given the often-mentioned reasons of increased profits and increased share value, downsizing is often immediately associated with organizations in the private sector. The economic conditions that have led to massive layoffs, reductions, and even demise in the private sector have been viewed as outside the domain of higher education (Cameron and Smart, 1998). However, it is becoming clear that downsizing and decline were very significant parts of the conditions faced by institutions of higher learning (Cameron and Smart, 1998) and public institutions in general during the 1990s. Cameron and Smart (1998) underline this fact by highlighting a number of surveys and articles on the troubles facing universities in the USA. Notably, Harvard had a $42 million deficit in 1992, Yale recently eliminated 50 arts and sciences faculty members, MIT offered 1,400 employees (including 300 tenured professors) a buyout package, San Diego State laid-off 147 tenured professors and eliminated nine academic departments, and UCLA cut $38 million from its budget. In Canada, universities and colleges in all provinces have also had to cut and slash as all have had budget cuts ± mainly through administrative reorganization, eliminating positions and merging departments (CEA, 1994). In the province of Quebec, where tuition rates are set by the Government and have been frozen for years, the university network funding was been cut by over $320 million from 1993- 1994 to 1998-1999. As such, downsizing’s reach has extended into the public sector and to higher education ± the university. In light of this reality, it is important to understand the methods of downsizing that are prevalent in the private sector that are applicable to higher education and to examine what particular constraints universities have when facing a financial crisis. The underpinnings of downsizing Downsizing has been defined by Freeman and Cameron (1993) as a set of activities, undertaken on the part of the management of an organization, designed to improve organizational efficiency, productivity, and/ or competitiveness; it represents a strategy implemented by managers that affects the size of the firm’s workforce and the work processes used. The key element of this definition is the fact that downsizing represents a conscious decision by management. Downsizing doesn’t happen to an organization, managers opt for it. Downsizing is a strategic decision. The current issue and full text archive of this journal is available at http://www.emeraldinsight.com/0951-354X.htm [126] The International Journal of Educational Management 16/3 [2002 ] 126±136 # MCB UP Limited [ISSN 0951-354X] [DOI 10.1108/0951354021042223 7] Keywords Downsizing, Universities , Organizational structure Abstract While downsizing is often automatically associated with for- profit organizations, many of the pressures that have led businesses to downsize over the last 20 years have also affected public-secto r organizations, including universities. The primary focus of this article is to underline the particular issues and problems facing universitie s when confronted with pressures to downsize. Begins with a general overview of downsizing and its outcomes, followed by an analysis of downsizing in higher education with an emphasis on three major points: the factors causing universities to consider downsizing; the special nature of universities that makes downsizing particularly difficult; and the downsizing methods used by universities.