Downsizing is not a new phenomenon. History holds testimony to the various phases of downsizing since ages. Although many companies have been able to justify their actions to downsize through some immediate reflections in the bottom line in the form of reduced manpower costs, there is no denying the fact that the phenomenon has tampered with the basic `organizational fabric' and the employees' psyche. Management of survivors is therefore crucial.

Over the last few decades, downsizing has been one of the most preferred routes of improving organizational efficiency and sustaining competitive advantage. For many organizations, downsizing has more or less become the norm rather than the exception. In the US alone, more than 43 million jobs have been lost on account of down-scaling since 1979, affecting more than one third of the households in the country. Nearer home, the new economic policy envisaged in 1991 proved to be the tick off for companies towards the `getting lean' trend. Rough estimates put the job loss at more than a million. VRS has become a common thing and a usual point of discussion with the salaried class. The impact on the common employee has been large, so also the repercussions. Although many companies have been able to justify their decisions to downsize through some immediate reflections in the bottom line in the form of reduced manpower costs, there is no denying the fact that the phenomenon has tampered with the basic `organizational fabric' and the psyche of the employees.

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