A survey of downsizing strategies and performance of chemical manufacturing firms in Kenya

Abstract

The central problem of this study was that while downsizing had been practiced in Kenya for some time, there was little enquiry about downsizing within the chemical manufacturing context. The purpose of this study was to gain a deeper understanding of the various forms of downsizing strategies adopted by chemical manufacturing firms in Kenya. The objectives of the study were to establish the prevalent downsizing strategies practiced by chemical manufacturing firms in Kenya and to determine whether these had any effect on performance. A descriptive research design was used in this study. The population of interest was all the registered chemical manufacturing firms in Kenya. A sample survey study was done. Descriptive research design was chosen because the study objectives aimed at determining the what, when and how of a phenomenon which was the concern of the study. Primary data was collected using semi-structured questionnaires. The questionnaires were administered by the researcher or mailed for distant targets. For the purpose of showing the relationship among various variables, quantitative analysis was done using both descriptive statistics. The techniques used were, mean scores, standard deviations. The findings from the study were presented in tables. The research found that chemical manufa~turing firms in Kenya pursue the three downsizing strategies. The most prevalent strategy was retrenchment followed by downscaling and p downscoping. Their resultant effects on subsequent firm performance were improvements in both financial and non-financial measures of performance. Based on these findings, it is recommended that chemical manufacturing firms in Kenya should adopt downsizing. Retrenchment was found to be the most reasonable due to the productivity challenge facing chemical manufacturing firms. The major limitation of the study was difficulty in providing the objective measures of performance by chemical manufacturing firms.