Regional insurance company Britam is set to send about 140 employees home in an exercise that is will cost the firm about Sh700 million.
The retrenchment, which will see letting go some of its executive positions, will mainly affect the company’s Kenyan unit, Britam said in a note to the press dated 1st March 2021.
The statement from Britam added that the new organizational structure will seek to cut corporate and shared service costs; reduce unnecessary hierarchies while putting the customer at the center of the business, resulting in a more competitive and efficient organization.
The cost-cutting measure comes just a month after Britam appointed Tavaziva Madzinga as the new group managing director following the retirement of Benson Wairegi who had served the company for 40 years.
“The entire process will entail review of roles and a Voluntary Early Retirement (VER) Programme will be implemented for roles falling off the structure. The entire exercise will be concluded by end May 2021,” said Britam in a statement adding that the move is a business strategy review spearheaded by the Board for the period 2021- 2025.
In the 2021-25 strategic cycle, Britam seeks to expand customer base to drive growth as well as improve efficiency in how the insurer runs its business to ensure better returns.
Over the past few years Britam has been plagued with inconsistent results performance that has heavily impacted on its perception amongst the investing community, thereby keeping its share price depressed.
There is need to address both the inconsistent market approach and high operating costs to ensure a more credible results performance in future, noted Britam.
Britam held another VER in 2018 when it was executing its previous strategy 2016-2020 dubbed ‘Go for Gold.’