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Cuts to resources increase inefficiency - what is this called?

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Staff cuts/layoffs/redundancies create a leaner, more efficient workforce, right?* But what if staff cuts cause increased administrative burden and more work at the same time as decreasing the quality of service? Help me figure out the name of this effect and where I can read more about it. *(Wrong, obviously, but that's management's premise, so stay with me.) An imaginary example:
Imagine you are a doctor at a medical service, and the manager of the service decides to cut the staffing of the service for budget reasons. They justify this decision by noting that sometimes appointments don't get utilised, and opine that it will not be a problem for patients to wait a little longer for appointments.

As time goes by, the doctors start getting emails and phone calls from patients pleading to be seen sooner for various reasons, and responding to those emails and calls starts to become a burden. Patients who don't feel they can wait to see their usual clinician end up booking with whoever has a cancellation, which means that doctor isn't familiar with that patient's history, and doctors have to spend a lot more time reading charts than they previously did. And patients are frustrated with the extra waiting time, of course, but more frustrated with having to explain their medical situation over and over, and feeling that going to the doctor is less helpful than it used to be.

The questions:
  • Is there a name for this effect, where a cut in resources makes the system paradoxically less efficient?
  • Do you know where I can read more about it? (FWIW I have access to a university library, so if you know of a really apposite journal article, I can probably access it).

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