Publication: Organisational factors influencing financial performance of KTDA factories in Kisii highlands region
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2024-06
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Mount Kenya University
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Abstract
Financial performance is a crucial indicator of an organization's productivity and
effectiveness, reflecting its ability to use resources to generate wealth, profits, and
returns for stakeholders. Various factors influence financial performance, including
resource utilization, employee productivity, and organizational leadership. This study
aimed to identify and examine the impact of organizational factors—such as
organizational structure, corporate governance, human resource capacity, and capital
structure decisions—on the financial performance of KTDA factories in the Kisii
Highlands Region. The study's objective was to collect and analyze data on these
organizational factors to understand their relationship with the financial performance of
the sampled KTDA factories. A quantitative research method was employed, and a
census of 36 respondents was conducted. The study relied exclusively on primary data
gathered through questionnaires distributed to participants. To determine the
relationship between each organizational factor and the financial performance of tea
factories, regression analysis was conducted using SPSS software. The findings
revealed that most respondents viewed the organizational structures of the tea factories
as highly hierarchical, occasionally hindering and negatively impacting decision-
making processes. All respondents affirmed that the tea factories had codes of ethics
guiding interactions between shareholders and the institutions, ensuring harmonious
relationships. However, they also noted instances of strained internal relations,
attributing these to the shortcomings of the current codes of ethics. The study suggested
that organizations should aim to maintain streamlined organizational structures to
reduce operational costs and improve efficiency. For the tea factories, granting them
autonomy from the KTDA parent company could significantly strengthen their
positions by relieving them of obligations to the parent organization.
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Financial performance, Regression, Human resource capacity, Organizational leadership