ABSTRACT
The study is on strengthening the competitive advantage of rural business through quality and environmental management system. Business in the rural areas are facing severe challenges with industries closing by the day as a result of inability to cope with competition arising from products from domestic and foreign companies which are cheaper in price and of better quality. The objectives of the study are to determine the extent of competitive advantage impact on rural business quality and environmental management system; to highlight competitive advantage factors that affect sustainability of rural business; to identify competitive advantage strategies that are used in strengthening rural business; to identify the key challenges of competitive advantage in strengthening rural business and to ascertain the extent to which corporate social responsibility improves competitive advantage of rural business.The study was centred in five states of South Eastern Nigeria selected through stratified sampling technique. The methodology of the study was descriptive survey research design. The instruments used for data collection were the interview and questionnaire, structured in line with 5 point likert scale. A sample size of six hundred and fifteen (615) was obtained from a population of nine hundred and ninety nine, (999). The findings indicated existence of a significant impact of competitive advantage on rural business quality and environmental management system; competitive advantage factors affect sustainability of rural business; competitive advantage strategies strengthen rural business; there are challenges facing competitive advantage in strengthening rural businesses, and corporate social responsibility improves competitive advantage of rural business. The conclusion of the study is that application of knowledge and technology, productivity, satisfaction of customer, infrastructure, government policies and corporate social responsibility are basic ingredient that strengthen rural business and ultimately guarantee competitive advantage. The recommendations of the study include: knowledge and technology application in the operation of rural business; satisfaction of customers as the purpose of rural business; control of waste that pollute the environment and government provision of enabling environment.
TABLE OF CONTENTS
Certification ii
Approval iii
Dedication iv
Acknowledgements v
Abstract vi
List of Tables x
List of Figures xii
CHAPTER ONE: INTRODUCTION
- Background of the Study 1
- Statement of the Problem 10
- Objectives of Study 11
1.4 Research Questions 11
1.5 Research Hypotheses 12
- Significance of the Study 12
1.7 Scope of Study 13
1.8 Time Scope 13
1.9 Limitations of Study 13
1.10 Definition of Terms 14
References 16
CHAPTER TWO: REVIEW OF RELATED LITERATURE
2.1 Introduction 18
2.2 Conceptual Framework 18
2.3 Rural Business and Quality Improvement 52
2.4 Issues in Creating an Enabling Environment for Rural
Business 73
2.5 Concept of Environmental Management System 103
2.6 Concept of Quality 137
2.7 Functions of Standard 145
2.8 Challenges of Business Definition 162
2.9 Corporate Social Responsibility of Business 173
2.10 Theoretical Framework 176
2.11 Direction ofr Emerging Advatnage Theories 179
2.12 Empirical Framework 182
2.13 Summary of the Related Literature 188
References 191
CHAPTER THREE: RESEARCH METHODOLOGY
3.1 Introduction 198
3.2 Research Design 198
3.3 Sources of Data 198
3.4 Tools for Data Collection 199
3.5 Population of Study 199
3.6 Sample Size Determination 199
3.7 Reliability of Instrument 201
3.8 Validity of the Instrument 202
3.9 Methods of Data Analysis 203
References 204
CHAPTER FOUR: DATA PRESENTATION, ANALYSIS AND DISCUSSION OF FINDINGS
4.1 Introduction 205
4.2 Data Presentation and Analysis 205
4.3 Biographical Data 206
4.4 Test of Hypotheses 222
4.5 Discussion of Findings 230
References 246
CHAPTER FIVE: SUMMARY OF MAJOR FINDINGS, CONCLUSION AND RECOMMENDATIONS
5.1 Introduction 247
5.2 Summary of Major Findings 247
5.3 Conclusion 247
5.4 Recommendations 248
5.5 Contribution to Knowledge 249
5.6 Suggested Area for Further Research 250
Bibliography 251
Appendix A 260
Appendix B 263
Appendix C 264
Appendix D 265
LIST OF TABLES
Table 2.1: Nigeria ranking on world economic forum’s global
competitiveness index alongside comparator countries 79
Table 2.2: Nigeria performance rankings on doing business indicators 82
Table 2.3: infrastructure indicators 83
Table 2.4: Nigerian business face the most serious electricity
constraint 84
Table 2.5: Corruption perception index, 2007 90
Table 2.6: Security services and security expenditure 92
Table 2.7: Reasons for perceiving access to land for expansion/relocation
to be a major or severe constraint – all formal sectors 95
Table 3.1: Sample size of each company 201
Table 3.2: Validity scale: 10- high, 5-medium, 0-low 203
Table 4.1: Distribution and return of the questionnaire 205 Table 4.2: Age distribution of respondents 206
Table 4.3: Sex distribution of respondents 207
Table 4.4: Respondents literacy level 207
Table 4.5 Technology and competitive advantage 208
Table 4.6 Knowledge and competitive advantage 208
Table 4.7 Organisational productivity and competitive advantage 209
Table 4.8 Constant facility improvement and competitive advantage 209
Table 4.9 Customer satisfaction and competitive advantage 210
Table 4.10 Shifting buyers need and competitive advantage 211
Table 4.11 Technological changes and competitive advantage 211
Table 4.12 Government policies and competitive advantage 212
Table 4.13 Input cost/availability and competitive advantage 212
Table 4.14: Differentiation and competitive advantage 213
Table 4.15: Pricing and competitive advantage 214
Table 4.16: Adoption of six sigma and competitive advantage 214
Table 4.17: Organization’s adoption of recycling and competitive
advantage 215
Table 4.18: Lean manufacturing and quality environment 215
Table 4.19: Intensity of rivalies and competitive challenges 216
Table 4.20: Lack of information on environment 217
Table 4.21: Not understanding true essence of business stand as a
challenge to performance 217
Table 4.22: Non availability of electricity as a challenge 218
Table 4.23: Settlement of business in court and conduct of business 218
Table 4.24: Community management development centre is part of social responsibility 219
Table 4.25: Waste control and social responsibility 220
Table 4.26: Laws of host community and social responsibility 220
Table 4.27: Worker’s care and social responsibility 221
Table 4.28: Customers product and social responsibility 221
Table 4.29: Descriptive statistics 222
Table 4.30: Correlations matrix on the relationship between comparative
advantage, business quality and environmental management system 223
Table 4.31: Cross tabulation 224
Table 4.32:Chi-square test 225
Table 4. 33 Descriptive statistics 226
Table 4. 34: One-sample kolmogorov-smirnov test 226
Table 4.35: Cross tabulation 227
Table 4.36: Chi-square test 228
Table 4.37: Descriptive statistics 229
Table 4.38 One-sample kolmogorov-smirnov test 229
LIST OF FIGURES
Figure 2.1: A Model of competitive advantage 52
Figure 2.2: Composition of taxes – international comparison 86
Figure 2.3: Firms perception of financial sector – International
comparism 87
Figure 2.4: Nigerian business is funded largely from retained
earnings 88
Figure 2.5: Evolution over time of Nigeria’s percentile rank for
rule of law and control of corruption 91
Figure 5.1: Model of compeitioned advantage for rural business 249
CHAPTER ONE
INTRODUCTION
BACKGROUND OF THE STUDY
The end of Second World War witnessed the emergence of revolutionary ideas that swept the African nations as they threw off the colonial yoke. The desire on the part of the new leaders in these countries is to promote rapid economic development coupled with the realization that ‘poverty anywhere is a threat to prosperity everywhere’, has aroused further interest in strengthening competitive advantage of rural business (Jhingan, 2007:1). As we move into the new millennium, we are entering an era of constant change. Becoming-and remaining-the winner, will require an ever increasing ability to make the right decisions and to execute those decisions more effectively than competitors. Success arises from being different and then being prepared to change again, to search and exploit new opportunities, for satisfying human wants and needs. Darwin’s law of ‘survival of the fittest’ governs the survival of products, services and societies: those most responsive to change achieve competitive advantage (Iyer, 2009:9).
Competitive advantage is the generation of ideas, alternatives, innovations and the transformation of those ideas and alternatives into useful applications that lead to change and improvement that allow nations and organisations to find position among its competitors (Carr and Johnson, 1995:62). In today’s business environment an essential element to an organisation’s success is for managers to manage at the speed of change, and that takes creativity and innovation to sustain the competitive nature of the organization. Companies that are effective are rapidly bringing innovative products and services to the market always to gain a huge competitive edge in today’s business world (Deming, 1993:8).
According to Dean (2004:114) competitive advantage means analyzing what factors that are necessary for an organisation’s long-term success. Relevant areas to review are its resources and the business environment. Firm’s resources include all assets, capabilities, organisational processes, firm’s attributes, information, knowledge, etc. controlled by firms. This enables the firm to conceive of and implement strategies that improve its efficiency (doing things right) and effectiveness (doing the right things). In the language of traditional strategic analysis, firm’s resources are strengths that they can use to conceive of and implement their strategies. Firm’s resources can be conveniently classified into three categories: physical capital resources, human capital resources and organisational capital resources. Physical capital resources include the physical technology used in a firm, a firm’s plant and equipment, its geographical location, and access to raw materials. Human capital resources include the training, experience, judgment, intelligence, relationships and insight of individual managers and workers in a firm. The organizational capital resources include a firm’s formal reporting structure, its formal and informal planning, controlling and coordinating systems, as well as relations among groups within a firm and between a firm and those in its environment (Barney, 1991: 101). All analysis done in respect of a firm’s resources is to achieve products and environmental quality.
Competitive advantage is a cohesive organism, which learns to adopt or adapt or find better ways of doing things essentially in response to its environment (Child, 1997: 67). The question then is what really should a firm do to maintain or to optimize its situation in its environment? Should it focus on its financial situation, its technology, or its human resources? Barney (1991: 108) suggests that in order for a resource to qualify as a source of sustained competitive advantage, the resource must add value to the firm, it must be rarely, it must be inimitable and it must be non-substitutable. Producing in line with environmental demand requires that the producer should make quality products that invariably satisfy the needs and wants of the consumers without destroying the environment.
Quality as a competitive advantage strategy is the sum of many methods of institutional development, ranging from competitive hiring procedures, creating appropriate funding opportunities, to facilitating communication and supporting innovative initiatives geared toward meeting the demands of consumers (Sybile, 2007:1). The most limiting factor for quality enhancement is not the nature of internal or external competitors but the limits of the resources when room for improvements is identified. Quality should be likened more to a set of institutional and individual attitudes, a “quality culture”, aiming at continuous enhancement of quality. Most importantly, it has to be emphasized that the future of quality culture as a meaningful contribution to institutional improvement depends on the survival of the willingness of individuals to improve.
Deming, in Iyer (2009:86) states that quality means what will sell, what the customer needs, what is presented in a way that he or she can use it, and what will do him or her some good-or at least try to. Feigenbaum (2007:116) maintains that quality is what the customer says it is in that it is quality that begets customer satisfaction, customer delight and an edge over competition.Siemens Corporation in Iyer (2009:90) asserts that quality is that when customers come back and their products don’t.Customer satisfaction is gained by focusing attention on all aspectsof the product or service that are meaningful to him or her.It a measure of applied values. It takes place at the customers premises.It reflects how much more competitive one is, how much less of a high-cost producer, or how much more of a cost-effective high share marketer.
According to Oxford Dictionary (1990:950) quality is the standard of something when compared to other things like it. Standard much like quality for that matter can be defined in multiple ways and for various purposes. In addition, they are often embedded in complex processes of definition, interpretation and implementation, which have a lasting impact on organizational quality.Yet, since quality itself is a complex construct with various dimensions and different meanings. It is important to consider which quality notions we are building upon or aim at (Harvey and Green, 1993: 206). Quality may be aimed at the process of manufacturing which is referred to as environmental management system.
