IMPACT OF STRATEGIC MANAGEMENT ON SMALL SCALE BUSINESS DEVELOPMENT(A CASE STUDY OF ASSUR ELECTRONICS, UYO)
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This study attempts to determine the Impact of Strategic Management on Small scale Business development. A survey research was conducted and its main tool of enquiry was a structured questionnaire. The objective of the study was set to determine how employer respond to managerial strategy in small business 50 copies of questionnaire were administered to the staff of Assur Electronics Limited out of which 45 were correctly filled and returned. The hypothesis was also formulated. The Research design adopted was both descriptive and inferential statistical method. The population of the study was 55 staff of Assur Electronics , of which 50 was randomly chosen as the sample size. Adopting the stratified random sampling method with simple percentage and chi-square test as the statistical tool. Findings revealed that organization can formulate goals and objectives of their business. Also, there was a significant relation between managerial strategy and employee’s attitude towards development and growth of the organization. It was also stress that strategic planning has an effect on the growth of productivity. It was recommended that organization should always embrace the appropriate implementations strategies. Also the employee should be motivated by their employer towards efficiency by compensating them.
- Background of the Study
Impact of strategic Management in businesses be it small, medium or large scale ventures in Nigeria cannot be over-emphasized because an explicit statement of strategy is the key to success in a changing business environment. Without a strategy, an organization is like a rudder-less ship going round in circles. In order to utilize the limited resources efficiently and effectively for the purpose of achieving higher profitability, small scale businesses needs strategy under the following conditions; when resources are finite, when there is uncertainty about competitive strength and behaviour, when decisions must be co-ordinated between far places and over time, when commitment of resources is irreversible, when there is uncertainty about control of initiative. Miller (2013).
A strategy is a plan of action, it is a tactical plan made in the light of what the enemy or competitors might do or not do. Strategy formulation is a grand plan to be followed to achieve a set objective in small scale business owners/managers must formulate policies and strategies if their businesses must continue to exist, serve and sustain competition. Jauch (2015).
Strategic Management is a document outlining the management goals, objectives, strategies for achieving the objectives (including the finishing or activity controls), performance indicators and the monitoring programs that apply to a fishery or activity.
Drucker (2015) defines planning as “the continuous process of making present risk-taking decision systematically and with greatest possible knowledge of their futurity, organizing systematically the efforts needed to carry out these decisions and measuring the results of the decisions against the expectation through organized, systematic feedback”. It is deciding in advance on what to do, how to do it, when to do it and who is to do it.
In many organizations, this is viewed as a process, for determining where an organization is going over the next year or more typically 3 to 5 years or more. The manager should be able to understand his organization and its operations as continuous. In planning for the future, the manager tries to develop a mental picture of what he or she wants the organization to look like in the future. It also includes the identification of possible opportunities and threats in whatever forms they may exist, a clear statement of their strategic intent covering the vision, mission, business definition, goals and objectives, strategic budgets for the purpose of resource allocation. Therefore an organization is forced to look ahead setting targets anticipating problems and focusing on set goals and objectives. According to Birch (2004) the focus of this work is on the influence of managerial strategy and the growth of small business in Akwa Ibom State.
1.3 Statement of the Problem
Most SMEs have folded up or crumbled today because of lack of growth strategies for long-term actualization of their goals and objectives. Some small and medium scale business enterprises formulate wrong or short-term goals or strategies without taking into consideration the long-term benefit and future of the firm. Lack of creative and innovative business ideas, underdeveloped entrepreneurship culture and limited understanding to modern production technologies, marketing and business techniques makes their strategies to failure. The reason why some small and medium scale enterprises lose their customers or remain stagnated is because there is no sound strategy laid down for good customer relationship and firm’s image. Some business enterprises have sound strategies but do not know how they can be effectively applied. Administrative problems was also identified has the major causes of SMEs growth strategies failure. Researchers identified poor recordkeeping, inexperience in the field of business owners, particularly a lack of technical knowledge, lack of planning culture, and lack of market research (Koteimkor, 2014).
1.3 Objectives of the Study
- To ascertain whether small business in Akwa Ibom State have managerial strategy.
- To determine how managerial strategy affects the growth of the small business in Akwa Ibom State.
- To determine how employer respond to managerial strategy in small business Akwa Ibom State.
- To establish the relationship between managerial strategy and the growth of small business.
1.4 Research Questions
- Does managerial strategy have any effect on the growth of small business in Akwa Ibom State?
- Does managerial strategy help on the growth of small business in Akwa Ibom State?
- Is there any relationship between managerial strategy and small business growth in Akwa Ibom State?
- Does managerial strategy contribute to the growth of small business?
1.5 Research Hypothesis
This section of the research study consists of the two types of hypothesis, in which the researcher considered in the course of carrying out this research study; such as the null hypothesis (H0) and the Alternative Hypothesis (H1).
H0: States that managerial strategy do not have any relationship with small business development.
H1: States that managerial strategy have a relationship with small business development
H0: States that managerial strategy do not contribute to small business development
H1: States that managerial strategy contribute greatly to small business development.
1.6 Significance of the Study
The basic of this study is to seek out how strategic management will help improve small business. This study will bring about an increasing awareness in the application of management strategy on small business.
The study will also be significance to the society, since the finding of the study will bring about formulation and implementation of strategy to achieve business aims. Strategic planning force the organization to look ahead setting targets, anticipating problems and focusing on set goals and directions. The study helps to enrich the knowledge of the reader.
1.7 Scope and Limitation of the Study
To enhance an effective study within the given time frame. Uncompromising attitude of respondent’s financial constraints, time factor and unavailability of resource materials constituted some of the limitations encountered by the researcher. Despite these problems, a considerable effort has been made to process the data for the successful completion of the research.
1.8 Definition of Terms
Management: The organization and coordination of the activities of a business in order to achieve defined objectives. Management the basic task of management includes both marketing and innovation.
Strategy: As a unified comprehensive and integrated plan that relates the strategic advantages of the firm to the challenges of the environment. It is designed to ensure that the basic objectives of the enterprises are achieved through proper execution by the organization. Jauch (2015).
Effectiveness: Means doing the right things, it is the result of making the right choice and following through to their logical conclusions.
Small Business: Are normally privately owned corporations, partnerships or sole proprietorships (web definition).
Productivity: Is a quantitative or statistically weightier measure of how efficiently a given set of resources is used in achieving a given set of objectives (Sauser, 2015).
Development: Is the process of growing, or is the process of increasing in size.