Organization Restructuring and Performance of Commercial Banks in Mombasa County, Kenya

Abstract

Organizational restructuring is very important especially for firms that operate in a dynamic environment characterized by high competition. Implementation of restructuring strategies should be carried out carefully and with great keenness to ensure that it serves its intended purpose. This study aimed at determining what effects organization restructuring has on performance of commercial banks in Mombasa County. The subvariables included determining the effects of departmentation , HR restructuring, decentralization of processes and mergers and acquisitions on the performance of commercial banks that operate in the County of Mombasa. The reviewed literature on the relevant theories and perceptions brought forth several objectives that guided the research which included that of departmentation, human resource restructuring, decentralization of processes and mergers and acquisitions. With regards to research methodology, the research design adopted by this study was the survey research design and it was instrumental in bringing out structured perceptions of the respondents with regards to organizational restructuring. Collection of primary data was done in all banks located in Mombasa county, using structured questionnaires. Descriptive statistics was used to analyze the data collected and it included findng the mean and standard deviations as well as inferential statistics. The study was expected to contribute knowledge in areas of organization restructuring and organizational performance. The findings from the study established that the banks had adopted various restructuring strategies over the recent past where the organizational restructuring parameters that were adopted to a great extent included departmentalization, humanresource restructuring and decentralization of processes, with mergers and acquisition being adoted to a much lower extent. This research concluded that the commercial banks had adopted organizational restructuring in the recent past by implementing different parameters and that this had resulted in improved performance. From the findings, the researcher recommends the enhancement of communication channels as well as review their existing structures and culture to ensure that it supports the restructuring efforts that are being adopted by the organization.