EVALUATION OF PLANNING PROBLEMS IN NIGERIA BUSINESS ENVIRONMENT
(A STUDY OF GUINNESS NIGERIA PLC, IKEJA, LAGOS)
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CHAPTER ONE
INTRODUCTION
1.1 Background to the Study
Entrepreneurship and Small Scale Enterprises has been identified as one of the ways of developing and improving the standard of living of individual and the society at large. For any society to grow and get out of poverty, entrepreneurship must be addressed, encouraged and be given maximum support by the public, government and private sector. The objective and aim of any Entrepreneur is to maximize profit, market share and social responsibilities, and this cannot be fulfilled without human beings and government agencies who formulate policies and co-ordinate the activities of the organization using the factors of productions such as Land, Labour, Capital and Entrepreneur.
What is Entrepreneur? An entrepreneur is an individual who sees an opportunity and utilizes it. An Entrepreneur is someone who wants to be an employer of labour he doesn’t want to be under somebody. He bears the risk alone in management of his firm, business, or venture and is responsible for the success and failure. Entrepreneurship is the practice of starting a new business or reviving an existing business, in order to capitalize on new found opportunities. The importance of entrepreneurship in any society, especially developing and third world country cannot be neglected. The success and the growth of American, Britain and the Europe will never be complete without mentioning the impact and contribution of Entrepreneurship and Small Scale Enterprises.
Shokan (1973), The Small Scale Industries Association, define Small Scale Entrepreneur as those having investments up to (N60, 000) Sixty Thousand Naira with not more than fifty (50) workers. Microsoft Corporation, Apple Computer, Dell Computer, UAC Plc, Lever Brother, Dantata, Dangote and other you see today started as an Entrepreneur. The retrenchment and downsizing in some key sectors of the economy in the past few years has showed that entrepreneurship and Small Scale Enterprises is the best option for any society to grow. The role of Small Scale Business in the Nigeria Economy Transformation cannot be overemphasized. In fact, the so-called Small Scale Entrepreneurship are the pivot on which the economy run.
The unemployment, limited resources and the huge amount of money the nation is spending on foreign made goods, was as a result of high number of illiteracy in the land, individual, private and government have neglected the important of Entrepreneurship and Education for too long. The awakening of experts, individual, private and the government that everybody should embrace Entrepreneurship and identify area he or she can fit in. We have areas like; School Establishment, Fish Farming, Poultry, Welding, Bricklaying, Movie Industry, Fabrics, Craft and many more.
In order for Entrepreneur to survive and contribute for the growth of the economy, government agency and private organization should provide and enabling business environment for operators in this field to survive. The operators and the organization must realize the need to develop human resources, through training and development. Entrepreneurship and Small Scale Enterprises is all about developmental programmes that will foster the initiative and creativity of employee and employer which will help individual to adapt him or herself to changes that may arise.
An Entrepreneur that is growth conscious must take training as an important aspect of its task. Training is every organization is concerned with the increasing knowledge and skills in doing a particular job and in day to day running of business. The same goes to development, because it helps to add value to the skills of the worker, improving their general knowledge and altering their attitude.
For some time now, so much has been said about entrepreneurship in Media, Newsprint and in the lips of every organs of the government, and yet, attention has not been given to small scale business enterprises by the government, especially those concerned with the formulation of government policies. This is a barrier to national development, considering the fact that over 60 percent of business functioning in the country fall within this category.
It can be said that an overwhelming proportion of both the industrial and absorptive meaning organization of less developing nations of the world depends largely on entrepreneurship. Hence, the mechanics of entrepreneurship has not been appreciably addressed. History has shown us that most advanced countries of the world today, passed through the various stages of industrial development, particularly in the fields of manufacturing and engineering, notably; United States of America (USA) and Japan, where a high amount of recognition is given to small scale business. It is not surprising therefore that some of the newly industrialized countries like Taiwan, Hong Kong and South Korea have followed similar paths which are paying adequate attention to small scale business enterprises.
In Nigeria, research has shown that small scale entrepreneurship constitutes over 60 percent of the nations businesses. In a depressed economy like that of Nigeria and African as a whole, and effective and efficient operation of small scale business enterprises is the only way through which this section of the economy can developed.
Shomolu Local Government is one of the twenty local governments in Lagos State. Shomolu Local Government was formerly known as Mushin East Local Government Area, when it was carved out of the defunct Mushin Town Council in 1976.
On December 1996, Kosofe Area was again carved out and became Kosofe Local Government. Also Bariga Local Government Development Area was carved out in 2003, while the remaining area retained Shomolu Local Government. The entrepreneurship in Shomolu area is basically printing. Shomolu is a home of printing in West Africa.
Shomolu is located at the East Senatorial District of Lagos State. It is bounded by three (3) Local Government Areas “ Yaba Local Government Area, Bariga Local Council Development Area, (part of Akoka, Bashua, Obanikoro, Pedro village, Onike, Ikorodu Road) and Mushin Local Government.
There are over eight settlements in Shomolu Local Government, these are grouped into eight wards as follows:
Shomolu Local Government has its headquarters at 2, Durosimi Street, Off Oguntolu Street, Shomolu, Lagos State and has about thirty-seven communities. Shomolu Local Government Area is essentially inhabited by the Yorubas, however, other ethnic group from East and Northern parts of the country are equally large in number in the Local Governemtn. Despite the diversity of its dwellers, the local government is very peaceful and the relationship between the different groups is very cordial.
The local government, since its inception has been performing its statutory functions effectively. The executive power at the local government is vested in the democratically elected chairman assisted by vice chairman and elected councilors representing eight wards in the area.
There are seven major departments in the local government that has a highly efficient and responsive civil service headed by a seasoned administrator known as Council Manager, Personnel management, the agricultural, rural and social development, education, budget and planning.
The major business in Shomolu is printing and the major commerce is banking and trading. The possibility of investing in the local government is further enhanced by the availability of land in various wards and its location beside express road “ Ikorodu express road. Also of advantage would be investors in the phased construction of lock-up shops and the development of shopping centres in various parts of the council. Shomolu is thickly commercialized with various banks and companies.
1.2 Statement of the Problem
Economic independence has become a subject of research to economists, industrialists, theorists, scientists and social reformers in recent times. This research therefore addresses itself to the critical need for economic independence via critical appraisal at the causes and failure of the small scale business to the Nigeria Business Environment.
It is believed that there is no country, which has never experienced certain degrees of failure when developing the sector of its entrepreneurship. These problems vary from one country to another although some of them tend to be identical in nature. One thing that normally comes to mind especially when setting up a business is the problems Small Scale Business Entrepreneurs encountered in the course of running business. As a result of limited capital coupled with the problems of obtaining loans from the commercial banks due to the lack of collateral required by the banks, the growth of such business or organization suffered different setbacks. Thus, this study tries to explore the challenges faced by entrepreneurs within the Nigeria Business Environment.
Another problem is low technical skill of teachers in school, as this tends to make productivity in such schools inefficient and in other sectors of the economy where technical skill is recurred. Poor management is another major problem as there is little specialization in management because owners combine many management functions, which could have been delegated to other managers. All these problems can lead to failure of Entrepreneurship and Small Scale Enterprises within the Nigeria Business Environment.
1.3 Aim and Objectives of the Study
This study is aimed at achieving the following objectives:-
- Determine the challenges faced by Entrepreneur in the course of their business.
- To make a critical examination on the management of Entrepreneurship and the Nigerian Business Environment.
- Provide guide to the survival business organization on the types of planning process that will help the organizations Entrepreneur in the mist of volatile environment.
- Furthermore, this study will also serve as a reference point for research students in the Nigeria business environment.
- Relevant Research Questions
In this study, the following questions would be answered accordingly:
- Does the Government of Nigeria have any plan concerning the growth of Entrepreneur and Small Scale Enterprises Business continuous existence in the Nigerian business environment?
- Does government economic policies have any effect on Entrepreneurship and Small-Scale Enterprises?
- What are the factors that affect the organization’s plan in the Nigerian business environment?
- How does the operating environment impact on the plans of Entrepreneur in the country?
1.5 Relevant Research Hypotheses
The following tentative statements shall be tested and validated in the study:-
Hypothesis I
H0: Not all types of businesses are suitable for Nigerian Business Environment
H1: All types of business are suitable for Nigerian Business Environment.
Hypothesis II
H0: Organizations cannot survive in the midst of volatile Environment?
H1: Organization can survive in the midst of volatile Environment.
1.6 Significance of the Study
The significance of this study is to identify entrepreneurship and the Nigerian Business environment and to evaluate related problems and then suggest solutions that will help to alleviate such barriers so as to perform better in the role of productivity. In the light of the above, this research shall point the importance of small scale to the nation’s economy which we hope will imitate corrective actions for the parties concerned (that is entrepreneurs, the government and the entire populace) where and when necessary. Thus, if the government focuses more attention on entrepreneurship by creating an enabling environment, the nation will be taking a bold step towards the realization of becoming economically independent like other industrialized nations of the world.
1.7 Scope of the Study
This research covers some selected small scale enterprises based in Lagos. In a study like this, a nationwide survey of small scale industry would have given us a more comprehensive appraisal of Nigerian business environment, but for time limitations, it was not possible.
Furthermore, to get the required information needed, this calls for personal interviews and distribution of questionnaires to schools. This idea was necessary because no entrepreneur will readily accept his business failure except with some facts.
1.8 Definition of Terms:
- Small Scale Business: This may be defined as a business organization established, owned, financed and controlled by one person or group of individual with the aim of making profit.
- Business: This a lawful human activity aimed at creating utilities and for profit. According to the American Heritage Dictionary (1980) refers to occupation, work or trade in which a person engaged.
- Business Environment: Business environment comprises all those factors that affect a company’s business operation both internal and external factors, includes customers, competitors, stakeholders etc.
- External Environment: External environment is an uncontrollable environmental factor such as political, economic, technology etc.
- Internal Environment: Internal environment refers to as controllable environmental factors such as company itself, employees, shareholders etc.
- Employment: This means people who are trained or qualified to get a job in order to earn an income for a living.
- Unemployment: This is a situation in which persons of working age that are capable of working and qualified by age to work but cannot find job.
- Transformation: Means the action of transforming or changing from one thing to another. Example like, rebuilding a business, transforming the economy of a nation.
- Forecasting: Forecasting is the prediction of the future, it involves analyzing and projecting the future
- Objectives: Objectives refers to specific target result or desired outcomes by organization or firms.
- Goal: Goal is something one hope to achieve.
- Organization: Organization is a group of people who form a business together to achieve a particular goal.
- Sample Survey: Sample survey is a mini census conducted on a carefully selected sample from the population.
- Policies: This refers to plans or course of action, taken by the policy maker in any organization.
REFERENCES
Shokan (1973). The Small Scale Industries Association.
Ibrahim, H. (1999). ˜Power Sector; NEPA Ready’, African Review of Business and Technology July, 26.
Olowo, B. (1999), ˜Taking Independent Action’, African Review of Business and Technology Dec. /Jan. 51.
Tijani “ Alawe, B. A. (2004). Entrepreneurship Processes and Small Business Management. Industrial Science Centre, Owoyemi House, Aboekuta Road, Sango Otta, Ogun State, Nigeria.
The Nigerian Industrial Development Bank, Newsletter (1996).
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