STRATEGIC BUSINESS UNITS AND ORGANIZATIONAL PERFORMANCE IN SELECTED MANUFACTURING COMPANIES IN SOUTH-EAST, NIGERIA
ABSTRACT
This research Strategic Business Units (SBU) and Organizational performance in selected manufacturing Companies in South-East Nigeria critically assessed the impact of Strategic Business Units on Organizational Performance over time. Strategic management deals with the major and emergent initiatives taken by general managers on behalf of owners, involving the utilization of resources to enhance the performance of firms in their external environment. This study is embarked upon to know why the business environment has been turbulent which has resulted in poor performance of most of our manufacturing companies, thereby making their product to be of poor quality and expensive. It is intended to reverse this trend. The objective of the study is to check the extent Strategic Business Units affect productivity of manufacturing companies. The study methodology adopted is the descriptive Survey design. The population of the study was three thousand and three (3003) workers with a sample size of five hundred (500) obtained using the Taro Yamane formular. This comprises lower, middle and top management staff of the Companies. Primary data collection was with questionnaire method using the five point Likert scale and Oral Interviews. Data was analyzed using tables and percentages. Hypothesis one and three were tested using Pearson Product Moment Correlation while hypothesis two and five were tested using Chi Square statistics. Hypotheses four was tested using Z-test. The results indicate that there was a significant relationship (rc = 0.96 > rt = 0.8114, P < 0.05) between Strategic Business Units and productivity of the selected manufacturing companies. Strategic Business Units significantly (P < 0.05) can be used to enhance profitability in the selected manufacturing companies. Strategic
Business Units significantly (rc =0.8253 > rt =0.8114, P < 0.05) can be used to address Technological challenges in the selected manufacturing companies. Use of Emerging means of Production is not significantly (P > 0.05) a major way of encouraging Strategic Business Units in the selected manufacturing companies performance index. Strategic Business Units can significantly (P < 0.05) be used in enhancing the market share in selected manufacturing Companies. The conclusion of this research is that there is a significant relationship between Strategic Business Units, productivity and profitability which can be used to address technological challenges in the selected manufacturing companies to enhance its market share. This research recommends that targets should not only be financial but also strategic. They should be underpinned by clear cut action plans that cascade down the organization and promote both ownership and commitment. Therefore in filling the gap created by previous works, this work will ensure that performance monitoring and tracking of individuals and Units in Strategic Business Units will help in knowing problem areas and effecting changes that could adversely affect the fortunes of the Strategic Business Units thereby shifting the burden of making an SBU President a scape goat in the event of company failure.
CHAPTER ONE
INTRODUCTION
1.1 Back ground of the Study
Until the 1940s, strategy was seen as primarily a matter for the military. Military history is filled with stories about strategy. Almost from the beginning of recorded time, leaders contemplating battle have devised offensive and counter-offensive moves for the purpose of defeating an enemy. The word strategy derives from the Greek for generalship, strategia, and entered the English vocabulary in 1688 as strategie. According to James’ 1810 Military Dictionary, it differs from tactics, which are immediate measures in face of an enemy. Strategy concerns something “done out of sight of an enemy.” Its origin can be traced bac k to Sun Tzu’s The Art of War from 500 BC. Over the years, the practice of Corporate strategy has evolved through five phases (each phase generally involved the perceived failure of the previous phase). These include: Basic Financial Planning (Budgeting), Long-range Planning (Extrapolation), Strategic (Externally Oriented) Planning, Strategic Management, Complex Systems Strategy: Complex Static Systems or Emergence and Complex Dynamic Systems (Vijaykumar, 2009: 1).
