Journal of Emerging Trends in Economics and Management Sciences: Home

Abstract:
Department of Human Resource This paper examines the effect of retrenchment on organizational performance based on a study conducted at the Telkom Kenya, Eldoret Branch over a 5 year period. Telkom Kenya (TKL) started retrenching in May 2006 in preparation for privatization. By end of 2010, a total of 501 employees had been retrenched at Eldoret Telkom. This case study utilised questionnaire as a data collection tool to collect the information. Of the 99 employees targeted, only 50 were interviewed during the study. The data collected was analysed using both descriptive and inferential statistics. The study findings indicated a positive change at TKL with improved service delivery with introduction of new wireless technology and new brands that were competitive in the market in the Kenyan market. A general cultural change in work has been cited in these improvements. Company revenue trend analysis of documentaries indicated that TKL financial performance had generally grown on a fairly upward trend. The results from the study also revealed that the new TKL products had received a substantially good rating (76%) in the market compared to other products and services from competitors such as Safaricom and Airtel. TKL is now ranked as the 3rd in preference by the consumers coming after Safaricom and Airtel. Generally, while retrenchment may generally lead to improved organizational performance in the short-run it is recommended that organizations should first analyze the outcomes of retrenchment on all aspects of the company and the retrenches before embarking on its implementation.

Keywords: effect, retrenchment, retained employees, performance telkom Kenya, Eldoret branch.

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