Downsizing the Thai subsidiary corporation: a case analysis

The unprecedented severity of the Asian economic recession in Thailand came as a shock to the indigenous corporate sector. Businesses long habituated to record levels of growth were suddenly confronted with spiralling costs and declining sales. In response to this crisis a number of powerful Western corporations began 'downsizing' their Thai operations in order to boost profitability levels via the reduction of staff. Adopting a processual approach, this article seeks to explore the role of 'corporate' and 'national' cultures in the local employee reaction to these externally imposed directives. Drawing on years of participative experience, the author presents a rare internal case study tracing the initiation and progression of one revelatory programme of downsizing throughout its year-long phase of implementation. Initial findings point to the dangers of Western management underestimating the strength and resilience of indigenous Thai business culture. Implications for Western MNCs and future research are outlined, along with some tentative recommendations for practice.