ABSTRACT
A significant aspect of small and medium scale enterprises is in the following developing areas, creation of employment, stimulation of indigenous entrepreneurship, transformation of traditional industry, linkage effort, contribution to regional activities or cooperation, utilization and multinationalisation of indigenous enterprises. Thus, government, agencies, corporate organizations, international sponsors, etc are expected to adequately provide or empower SMEs for sustainable economic (activities that guarantees) development and growth. This study therefore seeks to address the following issues – The enabling environment by government to small and medium scale enterprises are not always complete in any particular empowerment. In other words, transport and electricity may be available while water, communication, educational infrastructure, etc may not be available or inadequate. Thus, no environments are comprehensive or complete in any small and medium scale industry. Hostility in an operating environment (by government, or communities) often make the efforts and expectation of tile small and medium scale enterprises unrealistic. Other problems in realizing the objectives of government’s empowerment to small and medium scale enterprises are unregulated competition and inconsistencies in policies and programmes. The major data collection instrument to be use is the questionnaire. It will be structured with a four point likert scale to determine responses to the objective of the study. At the end of the study it was observed that, resources available for empowering SMEs in the Nigerian economy may not be considered adequate, that stringent regulatory controls of government on SM Es may affect their growth and development, that inability of SMEs to loans and other financial assistance may cause their failure, that absence of research and development on the activities of SMEs may affect their growth and development. it was therefore recommendations that, every effort should be given to discourage the difficulties of access to funds set aside for SMEs by financial institutions or the direct loans occasionally extended to them by the government by way of empowerment for stainable development, regular training and retraining should be provided, for SMEs to reduce the perennial problems of inadequate managerial capacity and poor quality services and products. To this regard, facilities should be adequate for training and developing the human resources (managers) needed in translating business in the right question in an empowerment for stainable development.
CHAPTER ONE INTRODUCTION
1.1 BACKGROUND OF THE STUDY
There is no doubt that small and medium scale enterprises constitute the real fabric of a nation’s economy. Ever since the country’s (Political) independence, this has been so, and even today the entire economic system is exclusively held in place by small and medium scale enterprises, Owualah (1998:8). However, the environment in which this sector operates is both challenging and rewarding. The fact that SMEs forms the engine for industrial growth and development in the economy recommends efforts that could make them strive.
By definition, Small and Medium Scale enterprises are business with investments in fixed assets (excluding land) of not more than #10 m (Ten Million Naira). There are several other criteria by different authors and scholars to describing Small Medium Scale enterprises. A significant aspect of small and medium scale enterprises is in the following developing areas, creation of employment, stimulation of indigenous entrepreneurship, transformation of traditional industry, linkage effort, contribution to regional activities or cooperation, utilization and multinationalisation of indigenous enterprises. To Adewolu (2005:43) small and medium scale enterprises are activities undertaken by a person or group of persons for the provision of goods and services to meet the present and future needs of third parties at a price and for a profit through the management of available resources. To him, small and medium scale enterprises could be found in the following areas; marketing of goods, provision of services, manufacturing of goods/products, cultivation of land and dissemination of information/knowledge. On the strength that small and medium scale enterprises are formed on the basis of partnership between owner(s) and the providers of conducive environment (i.e. the government), suggests that encouragements and assistance (i.e. empowerment) are usually expected from the government and her agents.
To Balogun (2004:22) some of the empowering factors from government to SMEs include; electricity, transportation, communication, water supply, financial infrastructure and educational facilities among others. Thus, government, agencies, corporate organizations, international sponsors, etc are expected to adequately provide
or empower SMEs for sustainable economic (activities that guarantees) development and growth. Trade policies and barriers are other critical areas to which government empowerment are needed for small and medium scale enterprises to effectively and efficiently accelerate or sustain the economy. To Daniju (2007:54) finance and skills acquisition which cut across all ages forms the key to empowerment of small and medium scale enterprises. A typical empowerment banks initiative to small and medium scale enterprise is the small and medium scale industry equity investment scheme (SMIEIS) and bank of industry (1301). Similarly the National Economic empowerment and development strategy (NEEDS) by the federal government addes as path of sustainable economic growth and development for small and medium scale enterprise in Nigeria.
The said NEEDS initiatives were borrowed from the programmes of the new partnership for African Development (NEPAD) in African Union. The government through NEEDS is a facilitator, providing the enabling environment for a free-maker system. Other areas of special empowerment of small and medium scale enterprises are; research institutions provision of industrial estate, protective benefit laws (i.e patents, copy right, trade marks and farm close), etc. Infact from forgoing analysis it could be understood that empowering small and medium scale enterprises as given by government and institutions is favourable as it reflects all sector of the economy, hence even or sustainable economic growth. A more result oriented step about developing small and medium scale enterprises in Nigeria is the focus on initiating and practicing courses on small and medium scale enterprises in the educational systems (at all levels) in Nigeria. This step is capable of expanding the entrepreneurship and the production of goods and services in the economy. It is strongly believe that if business owner(s) could respond according to the various
‘empowerments, small and medium scale enterprise will continue to occupy their pride of their place as “bedrock” for national development and growth. Moreso, it need be emphasize here that empowerment of small medium scale enterprises and their operations are limited to market forces, information and knowledge available to operators, technological innovations, international standards and financial I resources available.
1.2 STATEMENT OF THE PROBLEM
Empowering small and medium scale enterprises for sustainable economic development could have been very much appreciated and practiced if not for certain deficiencies, hence the need to tackle the following problem areas:
Businesses owners often times fall short of the required information and knowledge, as to when, where and to whom to refer to in time of empowerment in their businesses. Small and medium scale enterprises report show that failure usually result from their inability at identifying accurate and reliable marketing, financial and information technology facilities available in their operating environment(s).
Other reasons for small and medium scale enterprises not developing and growing in empowerment includes;
(i) Difficulties of access to fund set aside for their use by financial institutions or the direct loans occasionally extended to them by the government.
(ii) There are also the perennial problems of inadequate managerial capacity and
poor quality services and products. To this regard, facilities could be absent or inadequate for training and developing the human resources (managers) needed in translating government empowerment into their business in the right quantum. Thus a business dominated by inexperienced and unskilled manpower has limits to application of government’s empowerment to their businesses.
(iii) The enabling environment by government to small and medium scale enterprises are not always complete in any particular empowerment. In other words, transport and electricity may he available while water, communication, educational infrastructure, etc may not be available or inadequate. Thus, no environments are comprehensive or complete in any small and medium scale industry.
(iv) Hostility in an operating environment (by government, or communities) often make the efforts and expectation of tile small and medium scale enterprises unrealistic.
(v) There is also high cost of energy which is imported for use in manufacturing.
In other words, cost of installation and use of technology in small and medium
scale enterprises arc not affordable, even when such is provided by government, their maintenance costs are outrageous.
(vi) Inspite of government empowerment to most small and medium scale enterprises products, standards are not always in conformity with local and international demands.
(vii) Other problems in realizing the objectives of government’s empowerment to
small and medium scale enterprises are unregulated competition and inconsistencies in policies and programmes.
1.3 RESEARCH QUESTIONS
The following questions were formulated to guide this research,
(i) Is there any significance relationship between government empowerment and growth of small and medium scale enterprises?
(ii) Are the human and material resources required for executing government policies (empowerment) to small and medium scale enterprises adequate?
(iii) Could illiteracy or inaccurate information or knowledge about empowerment
of government to SMEs cause set backs to then capabilities in performance? (iv) Are the factors for enabling environment to small and medium scale
enterprises mutually exclusive for their growth through empowerment?
(v) What are the effects of frequent changes in government policies on empowering SMEs activities in an economy?
(vi) Could unregulated competition slow down or cause waste of resources of small and medium scale enterprises even on empowerment?
(vii) What arc the impact of inadequate technological education on small and medium scale enterprises on the development and growth of such businesses?
1.4 OBJECTIVES OF THE STUDY
The main objective of this study is to appraise the empowering of small and medium scale enterprises for sustainable economic development specially selected SMEs in Lagos.
Other objectives of the study include;
To determine the adequacy of science and technological facilities empowered to operators of small and medium scale enterprises.
To identify the training facilities (including research) provided for small and medium scale enterprises in the form of empowerment.
To assess strategies built by government through empowerment in meeting resources (finance and non-finance) requirement of small and medium scale enterprises for sustainable economic development.
To investigate how the variables of enabling environment could be optimally
combined as empowerment in meeting expectations of small and medium scale enterprises.
To identify control measures taken by government in an empowerment against wasteful competition by small and medium scale enterprises.
To makes recommendation based on the findings of the study.
1.5 RESEARCH HYPOTHESES
Based on statement of the problem and objectives of the study, the following hypotheses are formulated;
Hypotheses I
Ho: Empowering small and medium scale enterprises does not result to sustainable economic development and growth.
Hi: Empowering small and medium scale enterprises results to sustainable economic development and growth.
Hypotheses 11
Ho: The enabling environment as empowered by government or her agents for small and medium scale enterprises does not make them (SMEs) successful.
Hi: The enabling environment as empowered by government or her agents for small and medium scale enterprises makes them (SMEs) successful.
Hypotheses III
Ho: The adoptions and use of technological infrastructure as empowering tool does not determine the profits making ability of small and medium scale enterprises.
Hi: The adoptions and use of technological infrastructure as empowering tool determines the profits making ability of small and medium scale enterprises.
1.6 SIGNIFICANCE OF THE STUDY
The outcome of this research will be beneficial to the government, small and medium scale enterprises, management practitioners and academia.
To the government, this study will immensely assist her to plan and develop the sectors of an economy through empowerment and regulatory controls given to the small and medium scale enterprises. In other words. government could be adequately positioned to optimally expend her resources and gain revenue through policies and programmes initiated and executed in small and medium scale enterprises. Occasionally, government benefits in a way of revenue generating through imports and exports by small and medium scale enterprises.
To small and medium scale industries, they are empowered through this research to learn new skill/capabilities by adjusting to the trends towards the development and growth of their businesses and the economy. In other words, the small and medium scale enterprises could develop and grow in marketing, production of goods and services, agriculture, science and technology, finance and information. Through this study, small and medium scale enterprises could begin to do things, which ordinarily they could not do. Training and development of work force of SMEs arc enhanced. This study also is capable of correcting certain anomalies likely to come up following efforts of small and medium scale enterprises for development and growth. Thus, strength and weaknesses, opportunities and threats are discovered and used for the advantage of developing and improving small and medium scale enterprises.
To management practitioners, this study will make them keep abreast o[ new developments and techniques in the practice of empowering the development and growth of small and medium scale enterprises for sustainable economy. In this process, they could serve their clients better and efficiently.
To the academics, this study will form basis for further studies and sustains an existing knowledge on the subject matter.
1.7 LIMITATIONS OF THE STUDY
The research may encounter lots of problems in the course of collecting data and other relevant records. Getting the respondents to agree to interview may be difficult. Infact, their claims may be that releasing certain facts and figure could mean organizational “sale out” .In other words; their releasing some information could be against the customer, ethics and norms of their organizations and government. Similarly, inadequate financial provisions for the study may hinder the rate of progress for the research. Yet another constraint may be the short period of time within which to complete this project. These shortcomings not withstanding, sufficient data may be collected and use for generalization.
1.8 SCOPE OF THE STUDY
This study will be focused on the appraisal of the empowering of small and medium scale enterprises for sustainable economic development specially selected SMEs in Lagos It will involves a discussion on all aspects of the economy or businesses conducted by the small and medium scale enterprises. The study will cover selected government agencies charged with carrying on empowerment of SMEs, in Lagos and selected institutions of higher learning around Lagos
1.9 DEFINITION OF OPERATIONAL TERMS
Certain concepts and variables to be use in this study need be defined for clarity and comprehension. However, those not defined under this chapter will be treated in the course of the study.
Terms for Definition include;
Small and medium scale enterprises: these are enterprises with small capital outlay and limited number of employees in its operations. They are private initiatives aimed at developing resources in small scale within an economy, and in the process earned sonic profits.
Government business empowerment: this consists of the different provisions given by government or her agencies to businesses aimed at improving by empowering their production of goods and services.
Proficiency: this is expertise delivery of services to a third party. It could be described as knowledge, skills and behaviour needed for effective performance. In this study, it could come from the government, business owner to .each other or customers.
Performance: Manner and success in the execution of a work. It is a measure based on the expected results and standards.
This material content is developed to serve as a GUIDE for students to conduct academic research
THE EMPOWERING OF SMALL AND MEDIUM SCALE ENTERPRISES FOR SUSTAINABLE DEVELOPMENT A STUDY OF SMALL AND MEDIUM ENTERPRISES IN LAGOS
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