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The Role of Slack in Transforming Organizations

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  • Neil Thomson
  • Carla C.J.M. Millar

Abstract

We review the argument for and against keeping slack during the transformation of a plan-filling organization to a profit-seeking firm. Before the demise of the command economies, organizations in Central and Eastern European (CEE) countries were typified as being overstaffed, although the degree of overstaffing (slack) varied from country to country. This article reports on two small empirical studies in East Germany and Slovenia and examines the experiences of downsizing and its effects on the remaining staff. The findings, especially from East German companies, demonstrate the potentially corrosive effects of staff cutbacks on levels of information exchange and trust among surviving work-group members. Evidence from the Slovenian firms indicates that some degree of slack can have very positive consequences for information exchange and trust. In neither case did managers perceive and attempt to mobilize slack as a strategic resource.

Suggested Citation

  • Neil Thomson & Carla C.J.M. Millar, 2001. "The Role of Slack in Transforming Organizations," International Studies of Management & Organization, Taylor & Francis Journals, vol. 31(2), pages 65-83, June.
    • Handle: RePEc:taf:mimoxx:v:31:y:2001:i:2:p:65-83
    DOI: 10.1080/00208825.2001.11656815
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    Cited by:

    1. Wang, Ming-Chao & Chen, Pei-Chen & Fang, Shih-Chieh, 2018. "A critical view of knowledge networks and innovation performance: The mediation role of firms' knowledge integration capability," Journal of Business Research, Elsevier, vol. 88(C), pages 222-233.
    2. Manish Popli & Ashutosh Sinha, 2014. "Determinants of early movers in cross-border merger and acquisition wave in an emerging market: A study of Indian firms," Asia Pacific Journal of Management, Springer, vol. 31(4), pages 1075-1099, December.
    3. Sung, Bongsuk & Soh, Jin Young & Park, Chun Gun, 2022. "Comparing government support, firm heterogeneity, and inter-firm spillovers for productivity enhancement: Evidence from the Korean solar energy technology industry," Energy, Elsevier, vol. 246(C).

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