Advantages of company reorganization are as follows:
- Operational Cost Reduction-Payroll expenses are reduced due to
dismissal of some employees.
- Communication and decision making improves-Layer of management
is reduced which leads to improvement of communication and decision
making.
- Operational Efficency increases-New technologies are introduced
leading to better operational efficency.
Disadvantages of company reorganization are as follows:
- Productivity Loss-Reassigning of roles & responsibilities
involves training of the employees leading to productivity
loss.
- Poor Customer Service-Due to downsizing company is not able
provide service as per customer expectations.
- Low worker morale-Reorganization often leads to low worker
morale due to feeling of insecurity of job.