"Implications of Retrenchment Exercise on Employee Performance Management: A studyof Humanitarian Non-Profit Organization’s (NPO’s).st The dawn of the 21 century brought in one of the worst challenges for many organizations. Theunprecedented tough economic times coupled with the encroaching technology and automationin the industry has been blamed for causing job redundancy in many organizations. Because ofthese challenges, many structural and organizational interventions were adopted andimplemented, unfortunately, many organizations would not survive and were forced to close orscale down on their operations (Lewin, D 2007).Many Non-Profit humanitarian Organizations go through the worst of these challenges eventoday, but thanks to the innovative strategies which have ensured that they remain viable and oncourse. Some organizations have gone as far as undertaking the most feared retrenchmentexercise which ,althoughconsidered as the only option remaining for them to move forward andthrive , many questions have been raised concerning its short term and long term implicationsonthe future of the organization and to the workers .. Many experts have argued against such an approach fearing that it may not be a viable optionespecially for nonprofit making organizations considering their nature of operations. Theybelieve that nonprofit organizations exist so as to uplift the living standard of the communities inwhich they work in and must do anything possible to safeguard this interest no matter theprevailing circumstances. Although their argument may be true, but quoting from Mrs.Zanale Mbeki, a former SouthAfrican first lady “more welfare will not buy the poor from their misery”(Ngopulse: 2005). It isfeared that most humanitarian organizations are experiencing tough realities due to depressed finances and must find alternative ways of sustaining themselves in order to continue providingtheir essential services to the community.According to Mrs. Mbeki, the international community’s which have all along been the majorfinancer have rerouted their donor aid away from supporting these organizations, a situationwhich has continued to pose as a major threat to the development of these organizations. Becausefinances are hard to get, organizations are left with an option of shedding off its extra fats, andone way to do this is by retrenching part of its excess staff (Gachunga, H.G. 2009). However,these have raised several ethical dilemmas which they must be considered with a lot of sobrietyand wisdom.Obviously, the essence of doing retrenchment is to improve performance and productivity bycutting down on the cost of production and to enhance organizational competitive advantage. All these efforts will always narrow down to reducing the expenses incurred in sustaining a hugelabor force which in most cases may not be yielding commensurate results. The human resource department may be the only department entrusted with this high stakeresponsibility of retrenching excess staff in most organization.Retrenchment is a very delicateand sensitive process that requires systematic assessment of performance of each and everyindividual and to sieve out only worker who are considered less skilled, demotivated andmentally unstable workers(Cascio2002) Such a process is prone to abuse by the human resourcedepartment who may consider it as an opportunity to settle unjustified score with their enemiesin the workplace. Such a crafty mentality may end up hurting not only the worker but the wholeorganization.It may cause the organization to lose some of its best brains besides also causingunnecessary tension within the organization. According to studies by Cascio (2002) organizational improvement brought as a result ofretrenchment was only observed in few insignificant minority cases. It is therefore not clear whysuch a cruel exercise is recommended when its real value is not justified and has always neverlived to the expectation. According to Cascio, the consequences and benefits of carrying out retrenchment exercise differdepending on the reasons for doing it and seasons when it was done.Many critics haveexpressed fears that the retrenchment done during seasons of recession is more devastation thanthose done during periods of economic boom. However, if done appropriately as required andduring seasons of economic stability, it results into long- term benefits to the organization.The strategy to lay down workers has in most cases not injected the much anticipated new bloodinto the organizations. In fact most of these organizations have suffered a blow , it is a processthat hurts the organizational loyalty , causes job dissatisfaction, stresses and increased laborunrest .Furthermore , it is an exercise that have caused organizations to lose manyof its bestbrains and tarnishing its image in the eyes of the public (Cameron,1998)..Workers have found themselves on the receiving end, with many of them prematurely losingtheir jobs under circumstances they claim they do not understand and during times when theyleast expected it to happen. As a sign of frustration many workers haveprotestedand sought legal actions from courts to have the decision reversed on financial and social ground claimingthat they wereservicinghefty loans and other financial obligations that required being on job inorder to meet financial obligations(De Meuse et al., 2004).It is saddening that such a move is sometimes undertaken by the management without consultingthe worker and psychologically preparing the prospective retrenchees. Such ignorance has leftmany retrenchees with lasting scars of pain. It is not a surprise to learn that many of them have succumbed to death or undergone prolonged period of mental and physical illness as a result ofthe pain inflicted on them due to being retrenched.Many experts have considered such a move as unjustified and aimed at causing frustration andpain to workers who had work hard for the sake of the organization. Some of them have beenheard complaining that they did not understand the procedure and methodology that was used inselecting those to be retrenched and have always considered it as a means to unfairly victimizeand punish workers for something they know little about.Such an exercise does not only affect the people who are retrenched, Krasz, (2004). Observedthat soon after retrenchment exercise, several other workers decided to voluntarily resign or quittheir jobs not because of being retrenched but because of being disappointed by how the wholeexercise was done. Many organizations experience this unprecedented behavior from theirworkers whom they had intended to retain due to their unique set of skills. When such valuableworkers decide to quit their jobs, they destabilize the whole organizations.Most retrenchments are done to fulfill the selfish interest of organizational and hardly do theyconsider the fate of those workers who will be affected. The law requires the employees to becompensated soon after being retrenched. It is disappointing that most organizations do not fulfilltheir pledges. No wonder they end up in fighting long and costly legal suits filed by their formeremployees. Nonetheless, there has always been conflicting evidence that have shown equal measure ofsuccess and failures of the retrenchment exercise by many organizations(De Meuse, 2004).Closeexamination of these evidence indicate that even though retrenchment is known to yield positivelong-term results, the short- term results are very frustrating and discouraging.Evidences collected from the recently concluded retrenchment exercise in Health Ignited, anon-profit humanitarian organization, did show thatimmediately after retrenchment exercise ,theremaining workers were left in such a horrible state of fearand suspicion , their enthusiasm ,energy andmoralewas negatively affected and show signs of physical and emotionalwithdrawalfrom work (Bhattacharyyan and Chatterjee. 2005). Furthermore, it was obvious thatas a result of massive exodus of workers, the remaining workers were left working in unfamiliarcircumstances and for long working hours due to pressure to deliver equivalent services underconstrained labor. Because of this , it was observed that many workerswere fatigued and therefore paid lessattentionto details and to the organizational objectives , indiscipline cases were also noted torise (Sheaffer et al.,2009) . All these eventually contributed to stagnation of organizationalproductivity. Contrary to the believe that the human resource department enjoy executing this role , researchby Rama Rao (2010) have indeed established that the officers working in the human resourcedepartment suffereven moreharm while executing these role . In most cases, these officershave become subject of blame and their lives have been put in danger by the workers whobelieve to have been targeted on malicious ground. Some of them have even been physicallytortured, or threatened to be killed or bewitched. Consequently, these have affected the moraleand working relationship between the human resource staff and the entire workforce and haveled to most of them underperforming or even making a decision to resign and quit. Just like the workers, the concerned organization has also equally suffered from the effects ofretrenchment exercise. According to research by Baguma ,P and Matagi L (200) there have beenindications of lowered performance in the affected organization which is believed to have been promulgated by the tense working environment and a massive loss of skilled and experiencedworkers. Filling these gaps have never been easy for the organizations, instead it have aggravatedunnecessary power wrangles and animosity within the work environment which hurtsperformance of duties and delivery of services.The organization image was also seriously affected; there were many court cases that were filedagainst the organization in regard to its failure to compensate for its retrenched workers. Thiseven ended up complicating the marketability or products and services provided by theorganization within the community in which they operated in.Equally important was the factthat because most of the retrenched workers were highly skilled and experienced, they wereimmediately absorbed by their competitors.This became a threat to attaining the muchanticipated competitive advantage over other rival.Nevertheless, more research have painteda brighter pictureconcerninghowindustries thatproperlyconducted their retrenchment exercisemanaged to positivelytranslatetheirperformance into a vibrant economy .Howeverthe same research have been quick to point out that these are results are long-term. Research done by Consolata N .Cohen (2013); have clearlyshown the long term benefits that retrenchment has to the organization. Just in a period ofbetween 3 and 5 years, the organization confidently presented an exciting performance whichenabled it to be ranked 3rd among its competitors. According to Consolatta ,the elaborate restructuring and reorganizational programs that wereinstitutedcaused interventionsthat were considered to have substantially reduced the overheadcost andprovided a conducive environment for fast decision makingandeasier communication due to decreased bureaucracy. It also may have enhanced job satisfaction by introduced theaspect of job specialization. "