ABSTRACT
Competition has become the norm of the day in modern economy. The world has become a global village, with modern technology and sophistication business competition has blossom in our present age. Modern business organization does not only compete with local industries but also foreign industries. While on one hand, it has given room to increase varieties of goods available to consumers and improved quality of the products, on the other hand, strive competition has led to the failure of many business enterprises. Thus, business survival and growth in the midst of competition has become the pivot goal at the management of every organisation. Necessary information we obtained through structured questionnaire administered on the direct clients and advertising agents of the company. A special questionnaire was also designed for Karrington staff. The survey involved 55 clients and staff. The corporate survival and growth strategies of the company and their limiting factors were identified. The result indicates that the growth of the company can be hinged on the quality control and modern technology. This has given the company a competitive edge over its competitors. This had also helped the company to secure customers loyalty over a long period of time.
CHAPTER ONE INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Business firms operate in a society to satisfy individual and social needs through the production of goods and services. Their decisions influence and are influenced by what is happening in the society. The social economic and political institutions that make up a society constitute in a broad sense the environment of business enterprises and the way they work, affects the operations and fortunes of every business unit.
The motivating factor for the entrepreneur to go or venture into businesses is to make profit. The objective of a business firm however goes beyond profitability only; it includes growth in size, increase in market share, innovation and social objectives. The realization of these objectives will be determined largely by the happenings in the environment. Specifically, the environment of a business comprises those activities that can hinder or facilitate the achievement of its objectives. They include population, technology, social infrastructure, economic system and competitors. Our focus in this study therefore is on the impact of the activities of the competitors
on a business firm. Customers have a choice to go elsewhere if a particular firm’s products or services do not meet their needs. They can go to the competitor who may claim they can do better or better still who satisfies their needs. This means that the activities of competitor in the same industrial sector as a company also affect a firm’s prospects and operations. The type and quality of products that competitor offer, the price they charge for their products or services, their sizes locations, reputation, distribution channels and usual stock level maintained, are some of the things about competitors which shape the operations of a business. No business firm can ignore the actions and decisions of its competitors in a modern economy characterized by competitions.
Fierce Business Competition in Modern Economy:
We operate an open market economy where competitions thrive. Increased competition is being driven by many factors, including the emergences of a global market place, the increase number of firms, new technology that makes it easier for firms to enter new markets and ever-increasing pressure from securities market to raise shareholder value. In particular the frenetic atmosphere of mergers and acquisitions, coupled with the increased number of large institutional investors, has meant that firms that do not cut costs and improve financial performance face swift action in equity markets. This competition has meant that companies are less able to insulate workers or invest in public goods such as research or employee training. For instance, in U.S.A in 1992, three fourth of 531 corporations surveyed identified economic pressure firm competitors as one of the primary factor motivating their restructuring efforts (Nation Policy Association, 1997). In 1965 IBM faced 2,500 competitors for all its markets. By 1992, it faced 50,000. And IBM is not alone in feeling outside pressure. While industries that were sheltered from significant competition such as telecommunication now faced growing competition, for instance NITEL now have an array of competitors in Nigeria Telecommunication Market such MTN, ZAIN, GLOBACOM, STAR-COMM, VODAPHONE etc. Stable industries have become dynamic. For example insurance was once a stale industry in Nigeria with a distribution system of local insurance agents, now its undergoing significant change, with competition emerging from foreign companies, banks selling insurance etc.
Adesina (2003) notes that competition ensures that we change our ways of doing things. It ensures that we raise our quality bar to international standard. Again, it can also be said that fairs and equitable competition helps achieve appropriate pricing level.
As a result of fierce business competition in the market, the number of firms being born and dying every year has grown. As less innovative and efficient companies die or contracts more innovation, efficient companies take their place. While firms can grow fast, they can go out of business or downsize just as quickly.
Moreover, fierce business competition has meant that companies are constantly developing new products and services in order to gain new market, consumers’ benefits because their needs are more specifically addressed and met.
Advertising and sales promotion play major role in competition in Nigeria, it can determine the fortune of any company. A company that fails to advertise will remain in obscurity and find it difficult to grow and expand. This account for the reason why many multinationals will as indigenous companies which are regarded as market leaders such as Coca-cola, Guinness (Nig) Plc, Nigerian Breweries Plc, Nigeria Bottling Company Plc, MTN Communications, West African Milk Company Plc, First Bank of Nigeria Plc, etc., budget millions of naira
annually on advertising and sales promotion, many advertising companies and agencies have spring up recently in Nigeria to meet the challenges in the Market. This has also brought competition to advertising industry itself.
Researching therefore into the strategies adopted by the lending advertising companies in Nigeria to survive and grow is crucial considering the strategic roles played by advertising and sales promotion in the survival of any company in modern economy.
1.2 STATEMENT OF THE PROBLEM
The economic circumstances characterized by recession and competition are now threatening the survival of many corporate establishments and such establishment need to wake up from their present state if they must survive in the next millennium. Prior to industrial revolution producers were regarded as kings and could produce anything since there were already markets for them, irrespective of quality, price etc. After the industrial revolution however, productivity increased beyond tensed. As a result, the royal crown of producers disappeared forcing them to be at the mercies of consumers. More production of goods and services were no longer
sufficient to give a company a competitive edge over others but policies and strategies put in place to achieve market leadership in view of the rigorous competition that has characterized the economic system, it was essential for companies to exploit circumstance and to deal with total actual and potential opportunities. Formulation for policies and strategies that will give them competitive edge became a must in order to survive.
In addition, business activities in the world today place under condition of great risk uncertainties and intense competition. It is no longer possible to rely on an “invisible hand” to regulate business operations and place any firm in a position of relative advantage in the market place (Adeoyeji, 1983).
The greatest challenge for a successful organization is change. Many good ideas about which products and services should be offered, how they should be produced and delivered has suddenly become obsolete in the face of change. Many organizations find it difficult to cope with changing customers need, new technology, innovation etc. as a result they fold up or one are taken over by more aggressive competitions.
Business failures and near failures are frequent occurrences, often the plights of a failing firm come as a great surprise to managers and shareholders alike. What may result in constant business failures therefore is inability to recognize opportunities and not so much the non-existence of opportunities in any business line of any sale whatever. Business failures like all mundane failure are never divine.
Therefore in recognition of the above problems this research has been undertaken to critically look at the causes of business failure and suggest practical business strategies for survival and growth in a competitive business environment in Nigeria.
1.3 OBJECTIVES OF THE STUDY
In view of the above, the objectives of study will include:
1. To determine the factors responsible for the growth of a company (business firm) in spite of market competitive.
2. To identify the limiting factors hindering the growth of a company in a competitive market.
3. To find out whether corporate survival and growth strategies significantly involves efficient and prompt service delivery.
4. To determine the effects of modern technology in enhancing corporate survival and growth strategies in a competitive business environment.
5. To find out whether advertising and sale promotion play a major role (determines the future of a company) in a competitive market.
6. To determine the major roles played by advertising and sales promotion in a competitive market.
1.4 RESEARCH QUESTIONS
The research questions for this study are as follows:
1. Does the provision of quality service enhance corporate survival and growth strategies in a competitive business environment?
2. Do modern technologies enhance corporate growth and survival?
3. Do you think advertising and sales promotion play a major role in competitive in Nigeria?
4. What are the motivating factors for the entrepreneur to venture into a business?
5. To what extent can equitable competition help to achieve appropriate pricing level?
6. How do the operations of competitors in the same industrial sector affects a firms prospects activities?
1.5 HYPOTHESIS OF THE STUDY
Ho: Corporate survival and growth strategies do not significantly involve ensuring the provision of quality service.
H1: Corporate survival and growth strategies significantly involve ensuring the provision of quality service.
Ho: Corporate survival and growth strategies are not significantly enhanced with the use of modern technology.
H1: Corporate survival and growth strategies are significantly enhanced with the use of modern technology.
Ho: The growth and survival of a company cannot be achieved through the enhancement of its competitive strategies.
H1: The growth and survival of a company can be achieved through the enhancement of its competitive strategies.
Ho: Profit making as one of the motivating factors cannot be a determinant for an entrepreneur to venture into a business.
H1: Profit making as one of the motivating factors can be a determinant for an entrepreneur to venture into a business.
Ho: Equitable competition in a growth and survival of a company cannot help to achieve appropriate pricing level.
H1: Equitable competition in a growth and survival of a company can help to achieve appropriate pricing level.
Ho: The operations of competitors in the same industrial sector cannot have a positive effect on the firm’s prospects and activities.
H1: The operations of competitors in the same industrial sector can have a positive effect on the firm’s prospects and activities.
1.6 SCOPE OF THE RESEARCH
The research covers the corporate survival and growth strategies in a competitive business environment. Our focus shall be the printing and outdoor advertising in Nigeria.
The attitude and compliance disposition of the current management of our studied company to an extent represents the industry.
1.7 SIGNIFICANCE OF THE STUDY
This study is aimed at achieving the following goals.
1. To enlighten the corporate organisation on the reality of competition in the modern world.
2. To spur the management of corporate organization on the need to be proactive and not reactive to competitors’ actions and decisions.
3. To assist organizations that have lost significant market shares to competitors on how to recover it back.
4. To assist new business firm confronted with intense competition from the established firms on how to survive and grow in the midst of competition.
5. To reduce the rate of business failure due to competition in
Nigeria.
6. To expose the entrepreneur to alternative survival and growth strategies aimed at improving the profitability and stability of establishment.
1.8 PLAN OF THE STUDY
The study is essentially divided into five chapters. Chapter one introduces us to the body of the work and its purpose, the scope and limitation of the research work.
Chapter two takes us to an in-depth review of relevant literature on the topic. In it, we shall look at the causes of corporate failure, the
importance of strategies management, market competition and business growth and survival strategy.
Chapter three is the research methodology which is highlighted to consist of the approach to the solution of the problems, method of data collection and data analysis.
In chapter four, an anticipated analysis of the data collected in the course of this research study is undertaken by means of statistical tools, the interpretation of how the result was arrived and was analyzed.
Finally, chapter five focuses on the summary of findings, recommendations and conclusions on how corporate organization can survive and grow in a highly competitive businesses environment.
This material content is developed to serve as a GUIDE for students to conduct academic research
CORPORATE SURVIVAL AND GROWTH STRATEGIES IN A COMPETITIVE BUSINESS ENVIRONMENT
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