Perception of organizational effects of staff downsizing on mobile network operators in Kenya
Staff layoffs within Mobile Network Operators in Kenya seem like the most common solutions available to management teams of operations faced with economic difficulty. This study targeted Mobile Network Operators in Kenya with a view of finding out the drivers to downsizing; its outcomes (costs and benefits); other factors impacting these outcomes; and ways of enhancing the success of the strategy. In line with the review of literature, the study found that downsizing is motivated by economic, strategic and technological reasons. The positive outcomes are increased profitability, improved productivity, better strategic positioning and leaner structures. On the negative side, the adverse effects include reduced staff morale, hampered innovative capacity, injured corporate reputation and loss of valuable knowledge and company strategies. Analysis of the outcomes of downsizing in relation to their underlying drivers therefore suggests that staff layoffs in themselves may be more damaging to the mobile network operators than beneficial. Positive outcomes can be achieved by other means. Key findings therefore indicate that downsizing should only be used as a strategic initiative aimed at increasing productivity and/or efficiency while retaining the most valuable resource in operations and that is the human capital. Key recommendations to human resources managers within mobile communications industry in Kenya is that: they should have knowledge of the context in which downsizing is taking place. Such knowledge makes them effective in deciding the criteria, processes and procedures to be adopted when downsizing and, there should be differential of treatment of employees during and after downsizing. This might lead to the strengthening of commitment towards the new organizational order. However, it might also lead to strengthening negative perceptions of deepening discrimination among the survivors.