The Influence of organisational restructuring on the performance of companies listed on the Nairobi Securities Exchange
Date
2024
Authors
Githinji, J.
Journal Title
Journal ISSN
Volume Title
Publisher
Strathmore University
Abstract
NSE listed firms have adopted various strategies to improve performance. Despite various strategies adopted, it remains uncertain how the restructuring has influenced performance of these organisations. This study therefore sought to find out the influence of organisational restructuring on performance of companies listed on the Nairobi Securities Exchange. It was guided by specific objectives namely: to determine the influence of operations restructuring, governance restructuring, downsizing and job restructuring on the performance of the companies listed on the NSE. The study was anchored on Theory of Change, Structuration Theory and Resource Based Theory. The study adopted descriptive research design. The targeted population of this study were the 179 senior managers of the seven companies listed on the Nairobi Securities Exchange based in Nairobi County, that have undergone restructuring in the last five years. A non-probability technique of purposive sampling was applied to select a sample size of 124 respondents. A structured questionnaire was used as an instrument for primary data collection. For quantitative data, descriptive statistics and inferential statistics was used in the analysis of data. From the data collected, the study had a high response rate. The study concludes that operations restructuring, governance restructuring and downsizing had a positive and significant relationship on organisational performance in NSE listed firms. The study also concludes that organisational restructuring had a positive and significant relationship on organisational performance in NSE listed firms. In contrast, the study established that job restructuring does not influence the organisational performance in NSE listed firms. The study recommends management should engage their employees when undertaking downsizing and ensure that there is a good approach in their downsizing process to take care of the emotive reactions that may arise. The study recommends that board diversity components, including gender diversity, board size, board independence, and board-director duality are very important to organisational performance and need to be strengthened. The study recommends that the policy makers should develop clear guidelines for organizational restructuring which can include best practices for communication, employee engagement, and redundancy management. The study recommends policy makers to promote training and support for companies undergoing restructuring. Policymakers could offer workshops or financial assistance for companies to help them plan and execute restructuring initiatives smoothly. Lastly, the study recommends policy makers to strengthen regulations for listed companies to incorporate regulations that require companies to disclose restructuring plans in detail and to provide clear justification for the chosen approach. This can increase transparency and accountability. During data collection, certain limitations were encountered as some respondents were reluctant to provide necessary information, likely due to their attitudes towards the study or concerns about potential victimization. To address this challenge, efforts were made to build rapport with respondents by explaining the purpose of the research and ensuring them that any information provided would be kept confidential. Furthermore, the study faced difficulties with questionnaire returns. To overcome this, research assistants facilitated a self-administered approach where they delivered and retrieved the questionnaires from respondents. The study recommended that additional research should be done on other variables of restructuring, for instance financial restructuring, and its influence on organisational performance in the NSE listed firms.
Description
Full - text thesis
Keywords
Citation
Githinji, J. (2024). The Influence of organisational restructuring on the performance of companies listed on the Nairobi Securities Exchange [Strathmore University]. http://hdl.handle.net/11071/15510