Turnaround strategies used at the national oil corporation of Kenya to improve performance

Abstract

Turnarounds are organizational recoveries from declines. In its most severe form, this decline usually culminates in substantial losses that threaten the financial viability of the enterprise. In its mildest form, declining performance may not threaten the financial viability of a firm, but it has some serious negative impacts on market competitiveness, customer confidence, and employee morale. Managers of firms experiencing such downturns can turn to specific strategies which are tailored to improve performances and competitive positions of the organizations. The causes of these distresses can be either internal or external hence the need to formulate appropriate plans to deal with all elements existing within and outside the firm. Due to management inefficiency, most of the corporate fail to identify the problems with strategies formulated at the various levels and therefore delay in taking precautionary measures affecting the owners, employees, customers, suppliers and the economy. To restore the organization on its normal course, a corporate turnaround is essential. Turnaround management is the systematic and rapid implementation of a range of measures (turnaround strategies) to correct a seriously unprofitable situation. Organizational performance is one of the most important variables in the management research and arguably the most important indicator of the organizational performance. The performance of an organization is the analysis of its productivity measured against internal metrics such as its goals and objectives. No business scenario can guarantee economic stability, and the ability to control organizational performance during a financial crisis becomes more difficult. National Oil is easily one of Africa‟s fastest growing oil companies. The launch of the 2008-2013 strategic plan coincided with the improvement in the company‟s fortunes, followed up by the three year strategic plan of 2013. This study will seek to fill the void existing due to lack of sufficient studies on the turnaround strategy adopted at National Oil Corporation of Kenya, how it was implemented and the challenges faced in the implementation process.