THE EFFECT OF ENTREPRENEUR’S QUALIFICATION ON SMALL SCALE BUSINESS PERFORMANCE IN NIGERIA (A STUDY OF SELECTED MANUFACTURING COMPANIES IN RIVERS STATE).
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THE EFFECT OF ENTREPRENEUR’S QUALIFICATION ON SMALL SCALE BUSINESS PERFORMANCE IN NIGERIA
(A STUDY OF SELECTED MANUFACTURING COMPANIES IN RIVERS STATE).
The study examines the effect of entrepreneurs’ qualification on small scale business performance in Nigeria. The respects were 20 drawn four industrial sectors, tailoring bakery, electronics and block mounding. The spearmen’s coefficient of rank correlation was employed for the analysis of data in the study. The study revealed that a significant relationship exist between the level of education and entrepreneurial success in small scale business. Also, this is a relationship between experience in related trade and entrepreneurial success. It is concluded that small firms must face challenges of survival and growth. However, previous experience in related trade of entrepreneurs will contribute greatly to the growth and development of small scale enterprises.
TABLE OF CONTENTS
Table of Contents vi
1.1 Introduction/background to the study 1
1.2 Statement of the problem 5
1.3 Purpose of the study 6
1.4 Research questions 7
1.5 Research hypothesis 8
1.6 Significance of the study 8
1.7 Scope of the study 10
1.8 Limitation of study 10
1.9 Conceptual definition 12
1.10 Organization of the study 13
CHAPTER TWO: LITERATURE REVIEW
2.1 concept of entrepreneurship and small scale business 16
2.2 features of small scale business 19
2.3 reason people take the entrepreneurial challenge 23
2.4 importance of entrepreneurship to social economic development 24
2.5 problems/constraints of small scale business 30
2.6 qualification to success in small scale business 37
CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Research design 38
3.2 Sample procedure/size determination 39
3.3 Data collection method 41
3.4 Operational measures of the variables 43
3.5 Data analysis 44
CHAPTER FOUR: DATA PRESENTATION AND ANALYSIS
4.1 Questionnaire distribution and collection 45
4.2 Data presentation and analysis 46
4.3 Testing of hypothesis 48
CHAPTER FIVE: DISCUSSION, CONCLUSION AND RECOMMENDATIONS
5.1 Discussion of findings 50
5.2 Conclusion 52
5.3 Recommendations 54
5.4 Biography 55
1.1 BACKGROUND OF THE STUDY
The term entrepreneur has been defined by many scholars in different dimensions but with the single trade of risks taker and organizer/decision maker or taker running through of all them; and profit being ultimate aim and reward of their adventure. However, what seems to be a problem about this understanding is about what qualifies an entrepreneur operate a business and become successful.
Studies conducted so far revealed certain qualifications that are necessary for entrepreneurs’ performance in small scale business organization. They include: risks bearing, decidedness in decision making, energetic, individual responsibility, anticipation of future possibilities, organization skills, self-directed, self-nurturing and self-confidence, action oriented, ability oriented and ability to deal with future.
While there is a general consensus that the most unique aspect of entrepreneurs is they should have the courage to begin a new enterprises, there is less than unanimous agreement as to what factors are most important in their qualification to determine their success or failure. However, one thing that emerged from all these debates is that the generally accepted prerequisites to success in any entrepreneurship are ability to source for genuine business opportunity, managerial ability and adequate capital of importance as suggested by McOliver (1998) is that the entrepreneur must be aware and have knowledge about his macroeconomic environment and study it where necessary, be fully acquainted with the parameters governing his performance, well-being and direction; have knowledge about some basic facts such as inflation, monetary and fiscal policies, type of inflation (cost her demand pull), deficiencies, leaking example in the economy and frequent policy changes.
McOliver saw the entrepreneur through the eyes of either being the Chief Executive or President of the organization. He is of the opinion that he should be seen as organizational leader, which he should be able to impose the function of:
Attaining present result based on previous decisions and planning for the future, based on present circumstances; maintaining and developing the organized capability, which makes achievement possible; coordinating the specialist functions that should enable his firm to perform the technical task in marketing, R&D, manufacturing, finance control, and personnel, especially in the face of changing technology and dynamic industry trend.
To be able to perform these functions, he opined that the entrepreneur must possess certain skills. These include conceptual skills and technical skills, which will transform the entrepreneur into a taskmaster, mediator, and motivator. It requires that he have appropriate and adequate background to be able to acquire the ability in the diction and the motivation of people and at the same time engage successfully in the elevation of their performance.
Making it a compulsion for him to be people oriented and at same time productivity oriented, and in addition being able to integrate functions and mediate conflict bound to occur in an environment, which beclouded with differing perceptions and values and provincialism of technical specialism. To integrate indicating a capacity to combine the economic, human and technical and moral aspects of the organization activity and selling the organization as it were to its immediate and distant communities.
In the light of the foregoing statement, the study will examine the effect of entrepreneurs’ qualifications on small scale business performance in Nigeria. Entrepreneurs in bakery, tailoring, printing and block molding business will be of immediate interest in the study.
1.2 STATEMENT OF THE PROBLEMS
Entrepreneurship can be seen as the willingness and the ability of an individual to seek out an investment opportunity, establish an enterprise based on this and run it successfully. It is actually concerned with crating opportunity and meeting the needs of individuals, and it is a process of identifying gaps in one’s immediate environment (community and society at large) and bringing together resources in an innovative way to fill these gaps.
Scholars are saying that the success of these survival strategies to grow and develop the small businesses may prove abortive due to:
The current uncertain business environment via: the macroeconomic issues, political issues, the policy process issues and consumer confidence issues; also, lack of learning system that disallowed and disempowered entrepreneurs from consistently spotting opportunities and extract value in a short period of time and thus losing focus on long term strategy; inability to overcome challenges of extreme uncertainty; highly dissatisfaction gaps and lack of previous knowledge of the business he is embarking upon could also pose another great deal of problem.
In the light of the above, the problem, which attracts our attention, is the type of entrepreneur’s qualification that could improve small scale business performance in Nigeria.
1.3 PURPOSE OF THE STUDY
The objective of this study is to identify some variables that are relevant to supply of capital, managerial ability and genuine business opportunity, and to measure the extent to which these variables are likely to contribute to the entrepreneurs qualification in the small scale business enterprises such as: bakery, tailoring, printing and block molding in determining their success or failure in entrepreneurship. Given this objective, the purpose of this are stated as follows:
1. To determine the relevance and appropriateness of entrepreneur’s qualification to improving small scale business performance.
2. To analyze the factors affecting the growth and development of small scale business in the Nigeria uncertain business environment.
3. To show the basis of success of highly qualified entrepreneurs in the uncertain environment of the Nigeria economy.
4. To suggest measures that will improve small scale business performance to gain competitive advantage in the marketplace especially in the area of qualitative customer services.
1.4 RESEARCH QUESTIONS
The following research questions will be necessary for the research endeavours
1. Determine the factors that qualify entrepreneur’s small scale business performance?
2. Indicate the relationship between entrepreneur’s qualification and entrepreneurial success in small scale business?
3. Are the basic qualification an entrepreneur should possess if he has to perform well?
4. Assess the effects of entrepreneur’s qualification into effective performance and ineffective performance?
1.5 RESEARCH HYPOTHESIS
H01: There is no relationship between Entrepreneurial success and type of product handled.
H02: There is no relationship between experience in related trade and entrepreneurial success.
1.6 SIGNIFICANCE OF THE STUDY
The significance of the study derives from the following: it would provide useful information to the various organizations on how to effectively utilize entrepreneur’s knowledge to realize improve productivity performance; promote quality, customer satisfaction, and customer value and customer loyalty. The outcome of this would without doubt bring about competitive advantage to the realization of the organization’s set objectives b it small scale or large scale business organization.
By highlighting the limitations of entrepreneurship to promote productivity performance of small scale business, the study will provide useful information to manufacturers or marketers (both public and private) on how to use business strategy to attain set goals.
The study will not only provide useful information to companies on how to improve productivity performance but also induce loyalty against the government regulatory authority if they have to stay in business and enhance improved performance. As a result, it will charge “thrives” firms have their successes underpinned by unceasing environment scan; tracking shifting dissatisfaction gap, unlearning; and leaning investment; values, strategy and short term opportunities; obsessive questing across eh value chain; human resources and strategy fit; flexible organizational structure and generally more open internal communication philosophy and the leadership style that focuses on the long term and values while capturing short term opportunity.
The study will serve academic purpose as it will serve a data bank to those who will carry out related studies in future, and moreover can serve the basis for further studies.
1.7 SCOPE OF THE STUDY
The study focuses on the effects of entrepreneur’s qualification on small scale business performance. Tailoring, block molding, bakery and printing are selected for the study. But to be comprehensive, it covers the objectives; the entrepreneurial challenges/strategies to small scale business performance.
1.8 LIMITATION OF THE STUDY
There are some limitations to this study.
Firstly, some of the individuals approached for information decline to complete the copies of questionnaire or be interviewed. Further the problem of secrecy in official quarters and security implications of divulging sensitive information may pose some difficulties in extracting honest and appropriate information form the firms enlisted for this study. This will limit the information available for the study.
Secondly, the study would have been more extensive if the medium scale enterprises and perhaps large enterprise were included. However, constraints of time and budget may also be indicated as problems. But the researcher may perhaps not afford the cost entailed; hence the restrictions to only one type of entrepreneurship where our choice of sample and representation will be possible.
Finally, the study is going on a time when other academic work place much demand on the researcher. This development is posing a lot of problems to the successful completion of this study. In spite of these limitations, it is hoped that our determination to succeed would make the study relevant, not only for the expansion of the frontiers of knowledge but for policy formulation and implementation.
1.9 CONCEPTUAL DEFINITIONS
Five terms need to be defined in order to eliminate possible confusion; entrepreneur, entrepreneurship, entrepreneurs qualification, success and failure.
An entrepreneur is an individual who establishes and manages a business for the principal purpose of profit and growth. He is characterized principally by innovative behaviour and will employ strategic management practices in the business.
Broadly defined, entrepreneurship is the appropriation and management of human and material resources with the goal of creating, developing and implementing solutions responding to the needs of people.
Entrepreneur’s qualifications are the prerequisites such as a genuine business opportunity, managerial ability and adequate capital the entrepreneur should have to succeed in any business notwithstanding the nature of the business environment, that age of the business and his initial capital.
A successful entrepreneur is one who has doubled his turnover and/or asset size since the inception of his business, notwithstanding the age of his business and his initial capital.
Similarly, a business is considered a failure if it has not achieved this feat.
1.10 ORGANIZATIONAL OF THE STUDY
The project will be organized into five chapters.
Chapter one background of the study. This includes a general introduction, statement of problem, objectives of study, research questions, research hypothesis, significance of the study, scope of the study, and limitation of the study.
Chapter two review of relevant literature. This chapter is devoted to an extensive review of the relevant literature on the subject matter of study.
Chapter three the research methodology. The methods, techniques and procedures followed in collecting and analysis the data will be explained in this chapter through; research design, sample procedure/sample size determination, data collection methods, operational measures of the variables and decision rule.
Chapter four, data presentation and analysis. In this chapter, the researcher will present and analyze the data collection from the respondents.
Chapter five, conclusion. This chapter will deal with the summary of findings, some selected recommendation and conclusion of the study.