Restructuring Strategies and Performance of Air Travel Agencies in Kenya

Abstract

Air Travel Agents offer vital services that create a one stop shop for air travelers who seek comprehensive booking services for travel and destination accommodation. In the past few years, traditional Air travel agents have encountered myriad of challenges which have threatened their existence through decreased performance. These includes Covid -19 Pandemic that halted Air travel, unpredictable clientele base and extensive service delivery demands for impulsive travelers, periodic low seasons and unexpected travel cancellations, heightened competition and fast-moving technological advances. This study, sought to investigate effect of restructuring strategies on performance for Air Travel Agencies in Kenya. The specific objectives were to determine effect of downsizing strategy, outsourcing strategy, operational reorganization strategy and technology integration strategy on performance of Air travel Agencies in Kenya. The underpinning theories were by Resource Based View theory (RBV), Schumpeter Innovation theory and Agency theory. The study adopted descriptive survey design. The unit of analysis was 80 ATAs registered and licensed Air travel Agents in Kenya while the unit of observation was 240 members of staff drawn from Sales and Marketing, Operations and Finance departments. Using Taro Yamane formula, a sample size of 71 respondents was determined. Identification of respondents was done by use of stratified and random sampling. Structured questionnaire with close-ended questions was used for data collection data. Both descriptive and inferential techniques were used for data analysis where descriptive analysis employed mean and standard deviation, whereas inferential statistics involved use of linear regression analysis prediction. The study established that downsizing strategy positively impacted on enhanced performance for air travel agents. Downsizing strategy resulted in reduced operational costs significantly which in turn boosted operational efficiency for air travel agents. The study also found that outsourcing had a positive impact on performance of air travel agents, because it resulted in enhanced efficiency and speeds of service delivery. Operational reorganization strategy contributed in enhanced performance of air travel agents through eliminating wastage in personnel, time and releasing firm resources for more core business activities which boosted overall productivity. Finally, the study established that technology integration strategy impacted operational efficiency, speed of task execution, increased visibility and more customer inquiries which increased sales and consequently boosted performance of air travel agents. The study recommended that more networking and business sharing among air travel agents. Modernization of financial transactions and digitization through adopting modern technologies and gaining training on latest internet marketing technologies can also boost capacity in operation of air travel agents.