Workforce Reduction Strategy and Performance of Finlays Tea Extract, Kenya in Kericho County Government

Workforce reduction Strategy can have a significant impact on employee morale and productivity, particularly when it is executed without proper communication and support. In 2020, Finlay Tea Extract, Kenya underwent a restructuring of its operations, resulting in the elimination of certain roles to ensure sustainability amidst a challenging business environment characterized by low tea prices, decreased demand for various products, and rising external costs. Consequently, the company made the decision to reduce its workforce by 500 employees in Kenya and a 40-year-old tea extract factory as part of cost-cutting measures because the world tea market is so competitive. This research explored the effects of workforce reduction strategies on the performance of Finlays tea extract, Kenya in Kericho County. The study was guided by the balanced scorecard model, diffusion of innovation theory, and transaction cost economic theory. A descriptive research design was employed, targeting Finlays Tea Extract, Kenya, with a total of 66 respondents, including 6 managers and 60 support staff. A census of 66 respondents was conducted, utilizing a structured questionnaire to gather primary data. The questionnaires were pre-tested on 6 respondents within the organization, who were not part of the final study. The reliability of the questionnaire was assessed using Cronbach's alpha coefficient, and its construct, criterion, and content validity were assessed. Qualitative data was narratively presented and thematically analyzed, whereas quantitative data was analyzed using descriptive statistics like mean and standard deviations. Furthermore, inferential statistics were carried out, including regression and correlation analysis. The study found that workforce reduction strategy had a positive significant influence on the performance of Finlays tea extract, Kenya in Kericho County. The study found out that workforce reduction strategies can involve various steps such as conducting a thorough analysis of the current workforce, identifying areas of redundancy or inefficiency, and developing a strategic plan to reduce the number of employees while still maintaining productivity and efficiency. The study recommended that the organization should conduct thorough assessments of current staffing levels, identifying areas where redundancies or inefficiencies exist, and implementing targeted measures to streamline operations. Key Words: Workforce Reduction, Strategy Performance CITATION: Kipkorir, M., & Makhamara, F. H. (2024). Workforce reduction strategy and performance of Finlays Tea Extract, Kenya in Kericho County Government. The Strategic Journal of Business & Change Management, 11 (2), 294 – 305. http://dx.doi.org/10.61426/sjbcm.v11i2.2910