Category: Business Administration

The Effect Of Monetary Policy On The Financial Performance Of Commercial Banks In Kenya
ABSTRACT

Monetary policy is one of the principal economic management tools that the government uses to shape economic performance. The government through the Central Bank uses monetary policy tools like open market operations, central bank rate and cash reserve ratio for commercial banks with the objective of managing multiple monetary targets among them price stability, promotion of growth, achieving full employment, smoothing the business cycle, preventing financial crises, stabilizing long-term interest rates and the real exchange rate. Commercial banks act as a mediator for the Central Bank in implementing these tools and hence the basis for this study. This study was carried out with the following objectives; to establish the effect of Central Bank‟s open market operations on the financial performance of Commercial Banks; to establish the effect of Central Bank Rate (CBR) on the financial performance of Commercial Banks and to establish the effect of Reserve Ratio Requirement on the financial performance of Commercial Banks. The study adopted descriptive research design. The target population of this study was commercial banks operating in Kenya and regulated by the Central Bank of Kenya as at 31^st December 2014. For the purpose of this study, only secondary data was used. The secondary data was sourced from the Financial Statements of the commercial Banks that are available from their websites and Central Bank of Kenya Publications. Data was collected for a period of five years from 2010 to 2014. Data was analyzed using Statistical Package for Social Sciences (SPSS) version 16. The study then used descriptive statistics and inferential statistics to establish the relationship between monetary policies tools and the financial performance of commercial banks in Kenya. The study used Net Interest Margin as the measure for financial performance for the banks. The results showed that the model explained 17.7% of the variance in financial performance of commercial banks as given by the value of R². The model was also fit to explain the relationship as the F-Statistic of 5.581 was significant at 5% level, p=0.000. The study established that monetary policy tools as represented by open market operation β=0.506, p=0.608, CBR, β=-0.221, p=0.687, and cash reserve ratio, β=-4.349, p=0.622, have no significant effect on the financial performance of commercial banks in Kenya. Bank size was however found to have a weak positive effect, β = 0.009, p <0.0, on financial performance of commercial banks in Kenya. The study concludes that monetary policy tools employed by the central bank of Kenya do not have a significant effect on the financial performance of commercial banks in Kenya. The study therefore recommends that commercial banks need to focus more on the internal factors that affect financial performance of commercial banks as have been identified in other studies. The study further recommends that commercial banks should focus on monetary policy changes to the extent of complying with the Central Bank guidelines and adjusting their variables accordingly. This is a matter of management efficiency.

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

According to the Central Bank of Kenya, A commercial bank means a company which carries on, or proposes to carry on, banking business in Kenya and includes the Co-operative Bank of Kenya Limited but does not include the Central Bank of Kenya (CBK). Commercial banks in Kenya are licensed, supervised and regulated by the Central Bank of Kenya (CBK) as mandated under the Banking Act (Cap 488).

The environment in which commercial banks operate is constantly changing with different factors influencing their operations and hence performance. Since the turn of the millennium, the general business environment has become more volatile, unpredictable and very competitive, Pearce and Robinson (2005). Coping with the increasingly competitive environment has called on commercial banks to rethink their strategies. Commercial Banks must realize that their services and products, regardless of how good they are, will not simply guarantee good financial performance.

Recent trends in technology, financial innovations and globalization are certainly posing new challenges for market participants in the Kenyan financial sector. To this extent, advances in computer technology and telecommunications are expanding the frontiers of electronic banking and internet based financial services. In addition, local banks have continuously sought to establish branches in other East African countries. This leads to the banks been exposed to different environments in terms of regulations, market size, markets rates, etc which are country-specific. All those developments would surely have implications on the costs and revenues and hence the profitability of the commercial banks in the Kenyan banking industry.

During the 2015/16 Budget presentation by the Kenyan Cabinet Secretary to the National Treasury and the subsequent Finance Bill, Commercial Banks in Kenya have been given up to 2018 to increase their minimum core capital to KES 5 Billion from the current requirement of KES 2 billion. The Central Bank of Kenya through it Monetary Policy Committee has raised the Central Bank Rate in two consecutive meetings.

The understanding of the monetary policies in the home country and also the country of operation by the commercial bank would not only be useful for sustaining high profitability but would also be essential for the survival of these commercial banks by enabling them to hedge against the adversities of external shocks.

1.1.1 Monetary Policy in Kenya

The first decade after independence can be characterized as passive in the conduct of monetary policy in Kenya, mainly because no intervention was necessary in an environment of 8% GDP growth and below 2% inflation rate (Kinyua, 2001). The first major macroeconomic imbalance arose in the second decade in the form of 1973 oil crisis and the coffee boom of 1977/78. This came at a time when the fixed exchange rate system had just collapsed with the Britton Woods System in 1971. In these first two decades, monetary policy was conducted through direct tools which were cash reserve ratio, liquidity ratio, credit ceilings for commercial banks, and interest rate controls.

The 1990s brought about the liberalization of the economy where interest rate controls were removed and exchange rate made flexible, ushering in a new era in monetary policy where open market operations (OMO) was the main tool. This was a period characterized by high interest rates and widening interest spread, which inhibited the benefits of flexible interest rate policy such as increasing financial savings and reducing cost of capital. Competing against double digit inflation rate spurred on by excessive money supply and accommodation of troubled banks, CBK used indirect tools to tame inflation in an atmosphere of instability and extreme uncertainty. In 1996, the CBK Act was amended and this allowed the CBK to shift from targeting broad money to targeting broader money as the principal concept of money stock, (Kinyua, 2001).

The CBK operates under a monetary policy programming framework that includes monetary aggregates (liquidity and credit) targets that are consistent with a given level of inflation and economic growth. According to the Monetary Policy Statement (2014), overall month-on-month inflation remained within the Government target bounds during the second half of 2014 except in July and August 2014. This reflected the success of the monetary policy stance adopted by the Monetary Policy Committee (MPC) in the period. Specifically, overall inflation rose from 7.39 percent in June 2014 to 8.36 percent in August 2014 mainly reflecting increases in the prices of energy and most foodstuffs. However, it declined gradually thereafter to 6.02 percent in December 2014 mainly reflecting the indulgence of the base effect attributed to the implementation of the VAT Act in September 2013 and decreases in prices of energy and some food items. The 12-month non-food-non-fuel inflation, which measures the impact of monetary policy, remained stable below the 5 percent target in the second half of 2014 indicating that there was no significant demand driven inflationary pressure or threat to the economy. The threat of imported inflation was dampened by the significant decline in international oil prices during the period.

Despite the temporary pressures on most international currencies reflecting the global strengthening of the US Dollar, the exchange rate of the Kenya Shilling against the US Dollar maintained its stable trend during the year 2014. The Kenya Shilling strengthened, on average, against the other major international currencies and regional currencies. The strengthening of the US Dollar partly reflects the strong performance of the US economy and changing expectations on the timing of the first US interest rate increase coupled with weak growth in the Eurozone. The Kenya Shilling continued to be supported by the resilient foreign exchange inflows through diaspora remittances, increased net purchases of equity by foreign investors in the Nairobi Securities Exchange (NSE), and sustained confidence in the economy reflected in the massive over-subscription of the Sovereign Bond that was re-opened on tap in December 2014. Interventions by the Central Bank of Kenya (CBK) through direct sales of foreign exchange to commercial banks stopped short-term volatility in the period.

The movements in short-term rates were generally aligned to the Central Bank Rate (CBR) while Open Market Operations continued to support liquidity management during the period. The MPC retained the CBR at 8.50 percent in the second half of 2014 to continue anchoring inflationary expectations and maintain the desired price stability objective.

1.1.2 Financial Performance

Financial performance measurement generally looks at firms‟ financial ratios (derived from their financial statements) such as liquidity ratios, activity ratios, profitability ratios, and debt ratios. The financial performance of commercial banks is measured through its profitability. There are various profitability measures that are used to measure the performance of commercial banks such as the Net Interest Margin (NIM), the Return on Assets (ROA) and the Return on Equity (ROE).

The Net Interest Margin is a measure of the difference between the interest income generated by banks from their loans and the amount of interest paid out to their lenders (for example, deposits), relative to the amount of their (interest-earning) assets. It is usually expressed as a percentage of what the financial institution earns on loans in a specific time period and other assets minus the interest paid on borrowed funds divided by the average amount of the assets on which it earned income in that time period (the average earning assets). The NIM variable is defined as the net interest income divided by total earnings assets (Gul et. al., 2011).

Net interest margin measures the gap between the interest income the bank receives on loans and securities and interest cost of its borrowed funds. It reflects the cost of bank intermediation services and the efficiency of the bank. The higher the net interest margin, the higher the bank’s profit and the more stable the bank is. Thus, it is one of the key measures of bank profitability. However, a higher net interest margin could reflect riskier lending practices associated with substantial loan loss provisions (Khrawish, 2011).

The Return on Equity (ROE) is a financial ratio that refers to how much profit a company earned compared to the total amount of shareholder equity invested or found on the balance sheet. ROE is what the shareholders look in return for their investment. A business that has a high return on equity is more likely to be one that is capable of generating cash internally. Thus, the higher the ROE the better the company is in terms of profit generation. It is further explained by Khrawish (2011) that ROE is the ratio of Net Income after Taxes divided by Total Equity Capital. It represents the rate of return earned on the funds invested in the bank by its stockholders. ROE reflects how effectively a bank management is using shareholders‟ funds. Thus, it can be deduced from the above statement that the better the ROE the more effective the management in utilizing the shareholders capital.

The Return on Assets (ROA) is another financial ratio that refers to the profitability of a firm. It is a ratio of Income to its Total Assets (Khrawish, 2011). It measures the ability of the firm management to generate income by utilizing company assets at their disposal. In other words, it shows how efficiently the resources of the company are used to generate the income. It further indicates the efficiency of the management of a company in generating net income from all the resources of the institution (Khrawish, 2011). Wen (2010), state that a higher ROA shows that the company is more efficient in using its resources.

1.1.3 Effect of Monetary Policy on Financial Performance

The overall aim of the Monetary Policy is to set monetary policy targets that would ensure low and stable inflation, encourage growth, support long-term sustainability of public debt through stable interest rates and, by enhancing financial access within the economy, contribute to lowering the cost of doing business (MPS, 2014).

The CBK through, through Open Market Operations, purchases and sales of eligible securities to regulate the money supply and the credit conditions in the economy. OMO can also be used to stabilise short-term interest rates. When the Central Bank buys securities on the open market, it increases the reserves of Commercial banks, making it possible for them to expand their loans which increase the money supply. This thus means Commercial Banks can expand their loan book and thus increase in their profits.

The CBR is the lowest rate of interest charged on loans to commercial banks by the CBK. The level of the CBR is reviewed and announced by the Monetary Policy Committee (MPC) at least every two months and its movements, both in direction and magnitude, signal the monetary policy stance. An increase in the CBR signals an increase in the banks‟ lending rates hence a tightening of the banks‟ loan books. This is expected to reduce the banks‟ profitability.

The CRR is the proportion of a commercial bank‟s deposit liability which must be deposited at CBK. These deposits are held in the CRR Account at no interest. A reduction in the CRR releases liquidity thus enhancing the capacity of commercial banks to expand credit. This then is expected to increase interest income to the banks and hence increased profitability. An increase in the CRR tightens liquidity and could also dampen demand-driven inflationary pressures.

1.1.4 Commercial Banks in Kenya

The Companies Act, the Banking Act, the Central Bank of Kenya Act, the Kenya Bankers Association and the various guidelines issued by the Central Bank of Kenya (CBK), governs the Banking industry in Kenya. The banking sector in Kenya was liberalized in 1995 and exchange controls lifted. The CBK, which falls under the Cabinet Secretary to the National Treasury docket, is responsible for formulating and implementing monetary policy and fostering the liquidity, solvency and proper functioning of the financial system. The Central Bank of Kenya acts as the main regulator of commercial banks in Kenya (CBK Annual Report, 2014).

The banking industry in Kenya is composed of 43 Commercial Banks with 10 of them listed at the Nairobi Securities Exchange, 24 being locally owned and 4 being foreign owned. The banks have come together under the Kenya Bankers Association (KBA), which serves as a lobby for the banks‟ interests and addresses issues affecting member institutions. The commercial banks offer corporate and retail banking services with of late most of the banks starting to offer other services including investment banking and insurance products.

The banking sector plays a significant role in the implementation of government monetary policy. One of the key services rendered by banks is offering credit to the members of public. The rate at which members of the public are able to access loans and the amounts available for banks to lend, are highly guided by the CBK regulations. The banks also participate in purchase of government securities for example treasury bills and bonds which are aimed at raising funds for the government and maintaining low inflation levels. CBK also acts as a lender of last resort for commercial banks and hence the rate at which banks access credit influences the rate at which they offer credit to the members of the public.

1.2 Research Problem

Monetary policy is one of the principal economic management tools that governments use to shape economic performance. Measured against fiscal policy, monetary policy is said to be quicker at resolving economic shocks. Monetary policy objectives are concerned with the management of multiple monetary targets among them price stability, promotion of growth, achieving full employment, smoothing the business cycle, preventing financial crises, stabilizing long-term interest rates and the real exchange rate. Experience shows that emphasis is usually placed on maintaining price stability or ensuring low inflation rates.

The Central Bank of Kenya is responsible for the recommendation and implementation of monetary policy tools in Kenya. The CBK recommends the CRR, CBR and Treasury bill rates. Those tools are implemented through commercial banks and they are aimed at stabilizing the price levels in the economy. The use of cash reserve ratio affects the level of liquidity in the commercial banks. When commercial banks are faced with limited liquidity, they turn to other commercial banks for inter-bank borrowing. Those funds are borrowed at the CBR and it is usually very high, which affects the interest expense for the borrowing bank and the interest income for the lending bank. The other way to increase liquidity in the bank will be to borrow by floating a debt instrument. The rate offered for the debt instrument is also tied to the treasury bills or treasury bonds issued by the government through the Central Bank. These effects of the monetary tools are expected to have an effect on the financial performance of commercial banks.

Several research studies have been done in relation to commercial banks in Kenya: Gitonga (2010) studied the relationship between interest rate risk management and profitability of commercial banks in Kenya; Kimoro (2010) did a survey of the foreign exchange reserves risk management strategies adopted by the Central Bank of Kenya and Mbotu (2010) did a study on the impact of the Central Bank of Kenya rate (CBR) on commercial banks‟ benchmark lending interest rates. Ongore and Kusa (2013) study examined the effects of bank specific factors and macroeconomic factors on the performance of commercial banks in Kenya during the period from 2001 to 2010. Kiganda (2014) carried out a study on effect of macroeconomic factors on the profitability of commercial banks in Kenya with a focus on Equity Bank.

This study has identified a gap in the current literature and research with respect to monetary policy and its effect on financial performance of commercial banks. The literature reveals that while there is much effort by the government to influence the money supply by instituting various policy tools, an analysis on the effects of those tools on Commercial Banks‟ financial performance, which are the most used channel of transmission of the policies, is inconclusive. This study will therefore be motivated to fill the knowledge gap on effects of the various monetary policy tools on financial performance of commercial banks in Kenya with firm size as the control variable. The following research question will therefore be explored: What is the effect of monetary policy on the financial performance of commercial banks in Kenya?

1.3 Objectives of the study

The general objective of the study is to determine the effect of monetary policy and the financial performance of Commercial Banks in Kenya.

The specific objectives are as follows:
1. To establish the effect of Central Bank‟s open market operations on the financial performance of Commercial Banks.
2. To establish the effect of Central Bank Rate (CBR) on the financial performance of Commercial Banks.
3. To establish the effect of Reserve Ratio Requirement on the financial performance of Commercial Banks.
1.5        Value of the study

While this study may be of value to any person interested in monetary policies, it is anticipated that its findings will specifically benefit the following groups of people.

Investors will be in a position to utilize the research findings and recommendations from the study to forecast the financial performance of Commercial Banks and rebalance their portfolios accordingly given the changes in monetary policy tools.

The study is expected to contribute to the existing literature in the field of monetary policies. Future scholars can use this research as a basis for further research in the area of monetary policy theories.

The study will also enlighten management teams of commercial bank on the short-term and long-term effects of the monetary policy implementations by the Central Bank. This will greatly help them in designing the risk management measures to employ given anticipated changes in monetary policies.

Pages: 70

Category: Project

Format: Word & PDF

Chapters: 1-5

Source: Imsuinfo

Material contains Table of Content, Abstract and References.
03/28/2022
Managing Change And Innovation, A Panacea To Improve Organizational Performance. [A Study Of First And Union Banks Owerri Imo State]
ABSTRACT

This study examined managing change and innovation a panacea to improve organizational performance in financial institutions in Nigeria, a study of First and Union banks of Nigeria in Imo state. The study set out to determine the effect of structural mechanism on organizational performance in financial institutions, examine the effect of change resistance on organizational performance in financial institutions, ascertain the impact of collaboration on organizational performance of financial institutions. The study adopted the descriptive research design. Data was collected through survey method. Primary and secondary data were collected for this study using self-administered questionnaire and other means, such as text books, journals among others. Data was analyzed with the Kruskawallis test using 15.0 version of the Minitab statistical software (MSS). The study results showed that Nigerian banks currently operate in a rapidly changing environment as compared to the previous years and the rapidly changing environment motivated banks to be more proactive in generating new ideas and improving performance. The study results showed that change in the Nigerian banks was positive and acted as leverage for success and the change management practices used by the banks reduced the chances of resistance associated with adoption on new ideas. The results also indicated that successful change management and innovation could be measured by the level of performance of the banks. The study results revealed that Nigerian banks had a clear plan of managing change and innovation and that change management plans were well known and communicated to all employees. The study findings also indicated that management was always strictly focus on their determination to implement change processes and innovations in various phases in order to subdue any change resistance in financial organizations.

KEYWORDS: Management, Change, Innovation, Banks and Employees.

SECTION 1

INTRODUCTION
- Background of the Study
The present day financial institutions, quite unlike before 21^st century are operating in a very dynamic marketplace and this requires the ability to choose the right change opportunities while demonstrating the necessary degree of flexibility to meet the fluid requirements of the organization over time. The ability to select change management initiatives that are aligned with the organization’s strategic direction is fundamental for success. The world of banking and finance has been in a state of constant change. On the one hand, heightened regulations pose a significant challenge; just as customer behavior has changed massively (Kaiser and Ringlstetter, (2010). Private customers are fleeing into low-risk and liquid investments which lead to reduced demand for high-margin products and services. The persistently low levels of interest continue to exert additional pressure on yields (Barratt-Pugh, Bahn, and Gakere, 2011).

Barbaroux, (2011) stated that strategies and business models are being adapted to suit the changing customer behavior and to adjust the cost structures in line with the long-term lower profit expectations.

Jorgensen, Owen, and Neusn, (2009) Organizations that are successful with large-scale change initiatives have several things in common; primary among them is a defined governance structure encompassing the entire change cycle. Successful structures begin with the decision process and continue through final execution of the change initiative.

Hurn, (2012) Organizations need to adapt their structures and processes in a flexible way in order to gain a competitive edge and cope with the evolution of markets. This can be effectively achieved through redefining how they design and distribute tasks, allocate roles and responsibilities and coordinate dispersed decisions and activities. However, they also need to find means to maintain the reliability of their structures so as to ensure the continuity of their actions, particularly in hypercompetitive environments (Barbaroux, 2011). The main challenge here is to find a suitable balance between adapting to the flexible environment and maintaining reliability.
- Statement of the Problem
Change management and innovation is a fundamental cum critical factor for organizational survival in any economy like Nigeria. Thus change management and innovation demand an effective and efficient execution through staff collaboration, structural mechanism and possible resistance arising from the staff left behind by the development. One of the most recent change and innovation management in the financial sector in Nigeria was the e-banking, which recorded both negative effects such as increase in unemployment, internet fraud, among others and positive effects like customer satisfaction, increase in profits of the financial institutions, reduction in money laundry, etc.

But notwithstanding the invention and wave of change management and innovation in organizations, the performance of financial institutions in Imo state and Nigeria at large, especially the rate of efficiency and effective satisfaction of customers and general operations of financial institutions in Nigeria is still not encouraging at all. Most of the time these financial institutions throw blames on the government for not providing adequate basic social and infrastructural facilities, security among other reasons why they do not perform.

Bryman and Bell, (2003), Change management in financial institutions demand that they should have effective systems in place to counter unpredictable events that can sustain their operations, while minimizing the risks involved through innovations. Only financial institutions that are able to adapt to their changing environment and adopt new ideas and business methods have guaranteed survival (Deresky, 2008). Some of the forces of change which have impacted the performance of financial institutions mainly include technological advancements such as use of mobile phones and the internet (Bhattacharya and Thakor, 2003).

It is crucial that change management in financial institutions be made through sound analysis of how to properly implement changes cum innovations to avoid harm on their performance (Central Bank of Nigeria Bulletin, 2009).

Bank performance is directly dependent upon efficiency and effectiveness of change management and innovation, on the other hand tight control in standards to prevent negative performances associated with change management and innovation. This study therefore studied how well the financial institutions impaired on their prosperity, as a need for customers satisfaction and to strike a balance between tight control and standards in efficiency and effectiveness of change management and innovation in Nigeria, a study of Union and First bank Banks, Owerri.

1.3 Objectives of the Study

The main objective of this study was to determine the effect of change management and innovation on the performance of financial institutions in Owerri, using First and Union Banks of Nigeria as a study. Other specific objectives include:
1. determine the effect of structural mechanism on organizational performance in financial institutions.
2. ascertain the effect of change resistance on organizational performance in financial institutions.
3. examine the effect of collaboration on organizational performance in financial institutions.
1.4 Research Questions

This study sought to find answers to the following questions below;
1. How structural mechanism affected the organizational performance of financial institutions in Nigeria?
2. To what extent has change resistance affected the organizational performance of financial institutions in Nigeria?
3. To what extent has collaboration of staff affected the organizational performance of financial institutions in Nigeria?
  - Research Hypotheses
The hypotheses formulated from the research study are as follows
1. H₀₁ Structural mechanism has no significant effect on organizational performance of financial institutions in Nigeria.
2. H₀₂Change resistance has no significant effect on organizational performance of financial institutions in Nigeria.
3. H₀₃Collaboration of staff has no significant effect on organizational performance of financial institutions in Nigeria.
  
  Pages: 51
  
  Category: Project
  
  Format: Word & PDF
  
  Chapters: 1-5
  
  Source: Imsuinfo
  
  Material contains Table of Content, Abstract and References.
03/28/2022
Examination Of Procurement Practices And Performance Of Organisations [A Study Of Selected Manufacturing Companies In Imo State]
ABSTRACT

This study has examined procurement practices and performance of manufacturing firms in south east geopolitical zone. Procurement practices are a set of activities undertaken by an organization to promote effective management of its supply chain. Four research questions as well as four hypotheses were formulated. Data for the study was generated from both the primary and secondary sources. The questionnaire was the major instrument used to generate the data. The statistical tools used for data analysis is the Non-Parametric Kruskalwallis test using the 15.0 version of the Minitab statistical software (MSS). The kruskawalis is a non-parametric equivalent for one-way ANOVA. The four hypotheses were tested and the findings showed that buyer-supplier relationship affect market competitiveness of organization, supplier selection procedure affect organizational sustainability, procurement process management affect quality products and services and experience of the procurement staff affect organizational viability. All these findings were achieved as the calculations indicated the their p-value are less than the level of significance (0.05). Based on that the study recommends that organizations should employ the optimum procurement practices to enhance performance, competitiveness and improve their effectiveness in the service delivery to the public.

CHAPTER ONE

INTRODUCTION

1.1 Background of the study

The present day business environment is characterized by an expanding number of business competitors both in local and global trades. Managers not only have to re-establish their companies to produce higher-quality products and services, decrease waste, respond rapidly to the market, also to handle their supply chain management (SCM) efficiently. Procurement practices integrate various firm’s operations and support functions, synchronizing production with new orders, purchasing with demand, scheduling and shipping with customer requirements.

Burt, and Dobbler (2004) defined procurement practices as the pattern of decisions related to acquiring required materials and services to support operations activities that are consistent with the overall corporate strategy.

Okunola (2008) described organization as an entity formed by or comprising a group of people with the aims and objective carrying out some specific functions or performance of responsibilities or the other.

Derek (2010) defined performance as the willingness of an individual to carry out the goals and objectives of an organization.

However organization performance is the ability of group of individual to achieve certain of specific goals. Organizational performance indices include; market competitiveness, organizational sustainability, quality product, and organizational viability.

1.2 Statement of the Problem

Procurement practices touch many core aspects of a company’s operations, hence their successful deployment and usage are critical to the performance and survival of various organisations in Imo State and Nigeria in general. The industry’s procurement practices are fragile and predisposed to regular discontinuities. They are usually fraught with recurrent delays and occasional inability to deliver the products to the destination markets, irrespective of the effort by the organizations in most developing countries, like Nigeria. Notwithstanding the improved performance of the procurement function, procurement is still marred by shoddy works, poor quality goods and services in these developing and underdeveloped economies. This perennial problem has precipitated a decline of procurement/supply performance of enormous manufacturing companies in Imo State and Nigeria in general. Failure or delay in implementation of recommended procurement practices like buyer-supplier relationship, supplier selection procedure, experiences of the procurement staff and procurement process management has resulted to unnecessarily high operation costs, poor inventory control, unacceptable supplier appraisals standards, uncoordinated business activities, and failure to attract and retain experienced and skilled personnel in the procurement positions, thus affecting the function’s performance of organisations.

However the procurement functions of most organisations in Nigeria do not comply with the procurement practices and performance procedures, leading to irregular and subjective decisions that have had costly consequences for many organisations. In general procurement practices is very strategic to the success or failure of an organization, but there have not been adequate attention in this regards in Nigeria, which has resulted to lost of time, resources, finance among other factors. This situation has necessitated this research study.

1.3 Objectives of the Study

The main objective of this study is to examine procurement practices and performance of organization in the manufacturing industries in Imo state. This study aimed to achieve the following four specific objectives:

1 To examine the extent to which buyer-supplier relationship affects market competitiveness of an organisation.
1. To determine the extent to which supplier selection procedure affects organizational sustainability.
2. To examine the extent to which procurement process management affects quality products.
3. To ascertain the extent to which experience of procurement staff affects organizational viability.
1.4 Research Questions

This study sought to find answers to the following key questions:
- How has buyer-supplier relationship affected market competitiveness?
1. How has supplier selection procedure affected organizational sustainability?
2. To what degree has procurement process management affected quality products?
3. To what extent has experience of procurement staff affected organizational viability?
1.5 Hypotheses

The following hypotheses are formulated in their null form;

H₀₁: Buyer-supplier relationship does not affect market competitiveness.
- H₀₂: Suppliers selection procedure does not affect the organisational sustainability.
- H₀₃^:The degree of procurement process management does not affect the quality of product.
- H_o4_:The experiences of the procurement staff do not affect the organizational viability.
  
  Pages: 50
  
  Category: Project
  
  Format: Word & PDF
  
  Chapters: 1-5
  
  Source: Imsuinfo
  
  Material contains Table of Content, Abstract and References.
03/27/2022
Implication Of Success Factors On Project Implementation Effectiveness [A Study Of Selected Construction Companies In Imo State]
ABSTRACT

This study focused to examine implication of success factors on project implementation effectiveness, a study of selected construction companies in Imo state. This study’s specific objectives are to; assess the extent, cost and budget attainment affect project implementation effectiveness, determine the extent managers’ professionalism contribute to project implementation effectiveness and as ascertain the effects of stakeholders activities to project implementation effectiveness on some selected construction companies in Imo state. This study adopted survey design, data collected through primary and secondary sources. In the cause of this study, 140 copies of descriptive stationers, with likert formula were distributed but 100 copies were completed and returned back. This study analyzed the data collected and weighted the score distribution using principal maximum likelihood with probit regression analysis to capture the implication of success factors of cost, professionalism and stakeholders activities of the project sampled. The probit analysis results showed that projects approved in 2010 – 2018 performed better than projects approved in earlier years with 75%, which is 10% higher than those approved in 2001 – 2010 (60%). The average GDP and political stability indents indicated positive and scientific at 5% significant levels which clearly suggest that economic condition and political stability significantly affects the success of projects in Nigeria. Cost/budget, managers’ professionalism and stakeholders’ activities executed significant effects on the probability of effective project implementation. The study therefore concluded that collective responsibility among project stakeholders is a paramount condition for project implementation effectiveness. Also, that stable and sustainable economic and political condition is very necessary for all sectors project implementation effectiveness. It was therefore recommended that the economic and political atmosphere in Imo state and Nigeria at large should be conducive and managers should be professionals in cost budget estimation for effective and efficient implementation of projects.

SECTION ONE

INTRODUCTION

1.1 Background of the Study

The process of project implementation, involving the successful development and introduction of projects in the organization, presents an ongoing challenge for managers. The project implementation process is complex, usually requiring simultaneous attention to a wide variety of human, budgetary, and technical variables. As a result, the organizational project manager is faced with a difficult job characterized by role overload, frenetic activity, fragmentation, and superficiality. Often the typical project manager has responsibility for successful project outcomes without sufficient power, budget, or people to handle all of the elements essential for project success. In addition, projects are often initiated in the context of a turbulent, unpredictable, and dynamic environment. Consequently, the project manager would be well served by more information about those specific factors critical to project success. The project manager requires the necessary tools to help him or her focus attention on important areas and set differential priorities across different project elements. If it can be demonstrated that a set of factors under the project manager’s control can have a significant impact on project implementation success, the project manager will be better able to effectively deal with the many demands created by his job, channeling his energy more efficiently in attempting to successfully implement the project under development.

Much has been researched in the field of project management. The outcome of this has provided a lot of good ideas and methods, both theoretical and practical. Frameworks for measuring project success have been introduced, the idea of a balanced scorecard, critical success factors and so forth.

It is however worthwhile to mention that the factors of successful project implementation effectiveness in Nigeria may vary from other countries of the world, especially advanced nations such as the USA, Japan, Canada, Britain, etc. Even though that same processesor factors of implementation and delivering successful projects are concerned.

Projects can simply fail, although all planning and execution is near perfect, simply because they are ethically challenged and time was not reserved to evaluate ethical aspects. Project can be technically perfect, its planning and execution are excellent but it may fail because it goes against virtue, does not facilitate well-being of many, goes against what we would like to see as the categorical imperative project manager or work against the rights of people involved in the project and the society.

1.2 Statement of the Problem

Over the years, there have been several theories and suggested strategies for successful project implementation effectiveness management based on the critical success factors as identified by Pinto and Slevin [1989] and Schultz et al [1989]. Thus these suggested factors have enhanced and improved the success level of project management implementation and practices in some countries such as U.S.A as reported by Wilemon and Baker [1993].

Then, why is project management practice and implementation effectiveness in Nigeria still in an undefined state. It is crystal clear that the landscape of Nigeria is lettered with several abandoned projects, even projects that are completed have minimal satisfaction, much more expansive in the cost of execution and most time delivered behind the schedule or end time and most often below the designed specification, even when all necessary condition of fund, technical knowhow, security and other supports are there. Furthermore, the big question here is, is it that the critical factors identified by the researchers do not apply in the case of projects implemented in Nigeria? However, even if these identified success factors are implemented, how effective were they implemented after all? Otherwise why then is it that our project management professionals have not used them to improve their project implementation effectiveness level all this while. Finding the solutions to the above stated problems is the paramount concern of the study.

1.3 Objectives of the Study

The general objective of this study is to analyze the Success Factors on Project Implementation Effectiveness.

To this extent the specific objectives of this study includes:
- To assess the extent to which the project implementation effectiveness can be attributed to environmental, economic, social, cultural and technical/technological factors.
- To measure the extent mangers skills, experience and competence affect project implementation effectiveness.
- To assess the implication of project estimates, schedule and design on project implementation effectiveness.
1.4 Research Questions

Finding answers to the following questions is of importance to the realization of the stated objectives.
- To what extent are environmental, economic, social, cultural and technological factors more implacable to project implementation effectiveness?
- To what extent is managers skills, experience and competence correlated to project implementation effectiveness
- To what extent is project implementation effectiveness more reliable on project estimates, schedule and design?
1.5     Research Hypotheses

In order to test the statistical validity of effects of answers obtained on the above question to project implementation effectiveness, the hypothetical proposition is tested:

H₀₁:    There is no significant relationship between implicable success factors, such as environmental, economical, social, cultural and technological factors and project implementation effectiveness.

H₀₂. There is no significant relationship between manager skills, experience and competence and project implementation effectiveness.

H₀₃. There is no significant relationship between project estimate, schedule and design and project implementation effectiveness.

Pages: 55

Category: Project

Format: Word & PDF

Chapters: 1-5

Material contains Table of Content, Abstract and References.
11/22/2021
Ascertaining The Impact Of Leadership Skill On The Growth Of Small Scale Business
Abstract

This study has investigated the leadership and worker’s productivity in small scale enterprises/business. The major was to determine the effect of leadership styles on performance in small scale enterprises. Transformational and transactional leadership styles were considered in this study. Transformational leadership behaviors and performance/outcome considered relevant in the study with charisma, inspirational motivation and intellectual stimulation/individual consideration, and effectiveness, extra effort and satisfaction, respectively. Transactional leadership behaviors and performance/outcome variables were constructive/contingent reward and corrective/management by exception; and effort, productivity and loyalty/commitment, respectively. The study followed a survey design and employed evaluative quantitative analysis method. Analysis was based on primary data generated through a structured questionnaire Administered on respondents. The result showed that while transactional leadership style had significant positive effect on performance transactional leadership style had positive but insignificant effect on performance. The study concluded that transactional leadership style was more appropriate in including performance in small scale business than transformational leadership style and therefore, recommended transactional leadership style for the small scale enterprises within built strategies for transition to transformational leadership style as the enterprises develops, grows and matures.

CHAPTER ONE

1.0 INTRODUCTION

1.1 BACKGROUND OF STUDY

From time immemorial, mankind has been confronted with the problem of how to effectively make good use of the potentials of nature in association with other human beings. The desire to solve the above stated problem led to the emergence of the concept of leadership, The concept of leadership simply means that there must be someone in charge of a particular activity or activities designed to achieve a stated or certain objectives.

Small scale business suffers from a lot of problems daily and many suffers from it because the leader or boss has never thought of what to do, and how to do what to do in tackling the problems it faces. Specifically, in Aba today small business continues to fail in spite of their role in economic growth and development, studies have over the years found out that failure rate of firms is mainly attributed to lack of leadership ability and capacity of the employee in an organization to deliver maximally. For instance, in Aba, I saw in a business that makes up to 1.5 million naira a day that it couldn’t make up to 300,000 naira in a day if the boss isn’t around, through this I understood that lack of leadership in any organization, kills greatly the worker’s productivity.

The importance of leadership is followership. It is the willingness of the followers to follow a person that makes him/her a leader to influence his surbodinates, so that they strive willing towards the attainment of the organizational goals. This can be done through effective communication towards the achievement of group objectives. Therefore leadership is a process for the attainment of goals, through the exercise of influence by one person over another or a group to achieve designed objectives.

Keller, R.T. (2006). Noted that without leadership organizations would constitute an uncoordinated group of people lacking directions. A leader is the most influential person in an organization who provides directions, guide group activist and ensures that group of objectives are attained. The term influences includes power, personal and positional attributes of a given leader. The function of leadership pervades all sections or departments of any organization. A major problem facing small scale businesses in Aba, is that they practice the act of management, but fails to practice leadership or effective leadership. And this in balance has led to the anchor holding down small scale business to still remain small. I noticed that some business owner know how to manage their business to make money, but lack some leadership qualities to sustain the growth of their business. For instance I noticed that small business in Aba lacks the needed leadership qualities to market their product, Blent (2010). noted that lack of leadership skills in staff or employees in organization, comprising of basic skills, motivation and sustainable knowledge and training, effective communication would be hindered when an organization or business lacks the leadership qualifies to market their products business productivity and acceleration would be hindered.

Leadership effectiveness, therefore determines the success and failure of an organization in relation to some set objective. Organization is a social and economic entity in which different individuals perform quality of functions in order to achieve common goals.

Another problem facing small business is that the employees are allowed to do what they feel is good, but it should be that everyone in an organization should do as occasion demands. That is for an organization to function properly, that is to produce needed goal’s and service for it customers the worker must behave in a way specified by the management to fulfill its aims and objectives.

1.2 STATEMENT OF THE PROBLEM

In recognition of the fact that leadership skills and styles are highly priority to the survival of any business or goals, and are the ends towards which activity is aimed. These represent towards which organizing, staffing, directing and leading and controlling are aimed. The rampant closing up of both small and large business organizations in the recent time have stemmed from mismanagement by leaders due to inefficiency and lack of focus. It is therefore essential that leaders in business organizations are properly trained and educated in other to perform efficiency and effectively for the growth and profitability of the organization.

1.3 OBJECTIVES OF THE STUDY

The major purpose of this study is to ascertain the impact of leadership skill on the growth of small scale business. Specifically, the study aims at.
1. a) To ascertain how lack of good leadership can affect the growth and profit making of any small scale business organization.
b)To analyze how leadership skills and competence can enhance the growth of small scale business.
1. c) Identifying some problems affecting effective and efficient leadership in business organization.
1.4 RESEARCH QUESTIONS
1. To what extent does lack of good leadership affect the
growth and profit of smaller scale business in Isiala Ngwa

LG.A
1. How can leadership skills and competence enhance the growth of small scale business?
iii. What are the problems affecting effective and efficient leadership in business organization?

1.5 SIGNIFICANCE OF STUDY

A successful completion of this work would enable the researcher and the business world to know the impact of leadership skill in business organization. It would enable business men, firms charitable organizations, churches and profit making organizations, companies and individuals to appreciate the fact of gaining priority education and training of managers or leaders for effective utilization of their skills and knowledge.

Furthermore, it would enable business organizations (profit and non-profit making) to appreciate the significance and impact of leadership skills in term of inducing compliance, focus of group process and achievement, it will also provide useful information to the chamber of commerce, firms, students and various organizations about the impact of leadership skill on business. Finally, it will constitute a useful reference material for the library.

1.6 SCOPE OF STUDY

The study covers leadership skills and proficiency of leaders in small scale business in Isala Ngwa L.G.A of Aba Abia state. It also xrays what leading entails which include forward, in ward and outwards of the entire business organization. It also touches on the difference between leadership and management as well as leadership styles. The study will examine water packaging

company, love, joy enterprises and Jay Best wood finish production as case study.

1.7 LIMITATIONS OF THE STUDY

During   the   course   of this   research,   I   encountered   several problems which includes.

LEADERSHIP SKILL: according to oxford advance dictionary learners it is the ability of an individual (leader) to do something expertly and well.

Pages: 77

Category: Project

Format: Word & PDF

Chapters: 1-5

Material contains Table of Content, Abstract and References.
10/10/2021
Investigation of the leadership and worker’s productivity in small scale enterprises/business
Abstract

This study has investigated the leadership and worker’s productivity in small scale enterprises/business. The major was to determine the effect of leadership styles on performance in small scale enterprises. Transformational and transactional leadership styles were considered in this study. Transformational leadership behaviors and performance/outcome considered relevant in the study with charisma, inspirational motivation and intellectual stimulation/individual consideration, and effectiveness, extra effort and satisfaction, respectively. Transactional leadership behaviors and performance/outcome variables were constructive/contingent reward and corrective/management by exception; and effort, productivity and loyalty/commitment, respectively. The study followed a survey design and employed evaluative quantitative analysis method. Analysis was based on primary data generated through a structured questionnaire Administered on respondents. The result showed that while transactional leadership style had significant positive effect on performance transactional leadership style had positive but insignificant effect on performance. The study concluded that transactional leadership style was more appropriate in including performance in small scale business than transformational leadership style and therefore, recommended transactional leadership style for the small scale enterprises within built strategies for transition to transformational leadership style as the enterprises develops, grows and matures.

CHAPTER ONE

1.0 INTRODUCTION

1.1 BACKGROUND OF STUDY

From time immemorial, mankind has been confronted with the problem of how to effectively make good use of the potentials of nature in association with other human beings. The desire to solve the above stated problem led to the emergence of the concept of leadership, The concept of leadership simply means that there must be someone in charge of a particular activity or activities designed to achieve a stated or certain objectives.

Small scale business suffers from a lot of problems daily and many suffers from it because the leader or boss has never thought of what to do, and how to do what to do in tackling the problems it faces. Specifically, in Aba today small business continues to fail in spite of their role in economic growth and development, studies have over the years found out that failure rate of firms is mainly attributed to lack of leadership ability and capacity of the employee in an organization to deliver maximally. For instance, in Aba, I saw in a business that makes up to 1.5 million naira a day that it couldn’t make up to 300,000 naira in a day if the boss isn’t around, through this I understood that lack of leadership in any organization, kills greatly the worker’s productivity.

The importance of leadership is followership. It is the willingness of the followers to follow a person that makes him/her a leader to influence his surbodinates, so that they strive willing towards the attainment of the organizational goals. This can be done through effective communication towards the achievement of group objectives. Therefore leadership is a process for the attainment of goals, through the exercise of influence by one person over another or a group to achieve designed objectives.

Keller, R.T. (2006). Noted that without leadership organizations would constitute an uncoordinated group of people lacking directions. A leader is the most influential person in an organization who provides directions, guide group activist and ensures that group of objectives are attained. The term influences includes power, personal and positional attributes of a given leader. The function of leadership pervades all sections or departments of any organization. A major problem facing small scale businesses in Aba, is that they practice the act of management, but fails to practice leadership or effective leadership. And this in balance has led to the anchor holding down small scale business to still remain small. I noticed that some business owner know how to manage their business to make money, but lack some leadership qualities to sustain the growth of their business. For instance I noticed that small business in Aba lacks the needed leadership qualities to market their product, Blent (2010). noted that lack of leadership skills in staff or employees in organization, comprising of basic skills, motivation and sustainable knowledge and training, effective communication would be hindered when an organization or business lacks the leadership qualifies to market their products business productivity and acceleration would be hindered.

Leadership effectiveness, therefore determines the success and failure of an organization in relation to some set objective. Organization is a social and economic entity in which different individuals perform quality of functions in order to achieve common goals.

Another problem facing small business is that the employees are allowed to do what they feel is good, but it should be that everyone in an organization should do as occasion demands. That is for an organization to function properly, that is to produce needed goal’s and service for it customers the worker must behave in a way specified by the management to fulfill its aims and objectives.

1.2 STATEMENT OF THE PROBLEM

In recognition of the fact that leadership skills and styles are highly priority to the survival of any business or goals, and are the ends towards which activity is aimed. These represent towards which organizing, staffing, directing and leading and controlling are aimed. The rampant closing up of both small and large business organizations in the recent time have stemmed from mismanagement by leaders due to inefficiency and lack of focus. It is therefore essential that leaders in business organizations are properly trained and educated in other to perform efficiency and effectively for the growth and profitability of the organization.

1.3 OBJECTIVES OF THE STUDY

The major purpose of this study is to ascertain the impact of leadership skill on the growth of small scale business. Specifically, the study aims at.
1. a) To ascertain how lack of good leadership can affect the growth and profit making of any small scale business organization.
b)To analyze how leadership skills and competence can enhance the growth of small scale business.
1. c) Identifying some problems affecting effective and efficient leadership in business organization.
1.4 RESEARCH QUESTIONS
1. To what extent does lack of good leadership affect the
growth and profit of smaller scale business in Isiala Ngwa

LG.A
1. How can leadership skills and competence enhance the growth of small scale business?
iii. What are the problems affecting effective and efficient leadership in business organization?

1.5 SIGNIFICANCE OF STUDY

A successful completion of this work would enable the researcher and the business world to know the impact of leadership skill in business organization. It would enable business men, firms charitable organizations, churches and profit making organizations, companies and individuals to appreciate the fact of gaining priority education and training of managers or leaders for effective utilization of their skills and knowledge.

Furthermore, it would enable business organizations (profit and non-profit making) to appreciate the significance and impact of leadership skills in term of inducing compliance, focus of group process and achievement, it will also provide useful information to the chamber of commerce, firms, students and various organizations about the impact of leadership skill on business. Finally, it will constitute a useful reference material for the library.

1.6 SCOPE OF STUDY

The study covers leadership skills and proficiency of leaders in small scale business in Isala Ngwa L.G.A of Aba Abia state. It also xrays what leading entails which include forward, in ward and outwards of the entire business organization. It also touches on the difference between leadership and management as well as leadership styles. The study will examine water packaging

company, love, joy enterprises and Jay Best wood finish production as case study.

1.7 LIMITATIONS OF THE STUDY

During   the   course   of this   research,   I   encountered   several problems which includes.

LEADERSHIP SKILL: according to oxford advance dictionary learners it is the ability of an individual (leader) to do something expertly and well.

Pages: 77

Category: Project

Format: Word & PDF

Chapters: 1-5

Material contains Table of Content, Abstract and References.
10/10/2021