EFFECT OF BUSINESS ENVIRONMENT ON ORGANIZATIONAL GROWTH OF MANUFACTURING INDUSTRY
(A STUDY OF FIVE SELECTED ORGANIZATIONS IN ENUGU STATE)
ABSTRACT
This research work examined effect of business environment on organizational growth of manufacturing industry. A study of five selected organizations in Enugu State. The objectives of the study include to: determine the extent to which business environmental factors affect corporate organizational growth of manufacturing industry, identify the internal and external environmental factors that affect corporate organizational growth of manufacturing industry, assess the challenges militating against corporate organizational growth as a result of business environment and identify strategies that organizations can adopt in the wake of turbulent business environmental factors. The sources of data were the primary and secondary sources. The population of the study was 983 while the sample size of 284 was determined using the Taro Yamane’s formula. The data collected was presented in tables of frequencies, and percentages using the five point likert scale. The hypotheses were tested using the chi-square distribution formula. The findings included that business environmental factors have a significant effect on corporate organizational growth of manufacturing industry in Enugu State, there are internal and external environmental factors that affect corporate organizational growth of manufacturing industry in Enugu State, there are challenges militating against corporate organizational growth as a result of the business environment and organizations can adopt effective strategies in the wake of turbulent business environmental factors. The research concluded that reward management has a significant effect on corporate organizational growth of manufacturing industry and it was recommended that the government of the day should endeavour to create an enabling environment that would be truly conducive for business organisations to thrive without engaging in any act of fraudulent practices, that management of these manufacturing organisations should constantly scan the environment in order to understand the major trends of events and make proactive decisions that would neither jeopardise nor mortgaged the future of the organizations, that the government of the day should make the business organisations in the manufacturing sector to enjoy certain tax rebate as a result of prevailing economic condition under which they conduct their businesses and that management of organizations should adopt effective strategies in the wake of turbulent business environmental factors.
TABLE OF CONTENTS
CHAPTER ONE
INTRODUCTION
1.1     Background of the Study                        
1.2     Statement of the Problem                        
1.3     Objectives of the Study                         
1.4     Research Questions                            
1.5     Statement of Hypotheses                         
1.6     Significance of the Study                        
1.7    Scope of the Study                             
1.8    Limitation of the study                        
1.9    Operational definition of terms                    
CHAPTER TWO
REVIEW OF RELATED LITERATURE
2.1    Conceptual Framework of the Study                
2.2     Theoretical Framework                        
2.3    Historical Background                        
2.4    Empirical Review                              
2.5     Summary of Review of Related Literature             
CHAPTER THREE
METHODOLOGY
3.1    Research Design                            
3.2    Sources of Data                            
3.2.1    Primary Sources                            
3.2.2 Secondary Sources                            
3.3    Area of the Study                            
3.4     Population of the Study                        
3.5    Sample Size Determination                     
3.6     Instruments for Data Collection                
3.7    Validity of the Instrument                     
3.8    Reliability of the Instrument                    
3.9     Method of Data Presentation and Analysis        
CHAPTER FOUR
DATA PRESENTATION, ANALYSIS AND DISCUSSION OF FINDINGS
4.1    Data Presentation and Analysis                 
4.2    Bio-Data                                    
4.3     Data Relating To Research Questions            
4.3.1 Research Question One                        
4.3.2 Research Question Two                        
4.3.3 Research Question Three                        
4.3.4     Research Question Four                        
4.4    Test of Hypotheses                            
4.4.1 Test of Hypothesis One                    
4.4.2 Test of Hypothesis Two                        
4.4.3 Test of Hypothesis Three                        
4.4.4 Test of Hypothesis Four                        
4.5    Discussion of Findings                         
4.5.1 Discussion Based on Hypothesis One            
4.5.2: Discussion Based on Hypothesis Two            
4.5.3: Discussion Based on Hypothesis Three            
4.5.4 Discussion Based on Hypothesis Four            
CHAPTER FIVE
SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS
5.1    Summary of Findings                         
5.2     Conclusion                                 
5.3     Recommendations                             
5.4    Contribution to Knowledge                     
5.5     Suggestions for further Research                
List of References                              
Appendix                                    
Questionnaire                                
CHAPTER ONE
INTRODUCTION
1.1    Background of the Study
    Organizations do not exist in a vacuum, but in socio-cultural environment. The organization that intends to develop a viable strategy for its future, must continually evaluate its environment for opportunity and risk (Enudu, 2014:270). Both human beings and organizations are products of heredity and environment. Like a person’s heredity, an organization can do virtually nothing about its past history. But also like a human, an organization can do much about its environment. It can analyze it, predict it, attempt to change it in various ways, adapt to it, or leave it (or some major part of it). But before management can make a prudent decision to change, to adapt, or to leave, it must analyze the environment and assess its future (Gouri, 2015:95). Analyzing and predicting the environment directs attention not only to the situation as it is, but more importantly to the situation as it appears it will be. The progress of every business depends largely on its ability to become accustomed to environment. For instance, if the government changes its economic policies, a firm should appropriately respond to that change. Likewise, a firm should keenly observe and respond properly to the technological changes capable of rendering the existing products obsolete (Mishra, 2015:94). Thus, it can be identified that the association between business and its environment is very close and continuous. This association helps the business firm to reinforce its capabilities and allocate its resources more efficiently. In the words of (Jamal, 2016:103) business environment can be defined as the combination of internal and external factors that influence a company’s operating situation. The business environment can include factors such as: clients and suppliers, its competitors and owners, improvements in technology; laws and government activities and market and social economic trends. Business environment literally means all those aspects that have a bearing on the business, such as strengths, weaknesses, internal power relationships and orientations of the organization, government policies and regulations.
Adebayo (2015), posits that environment can be divided into two namely internal and external environment. Internal business environment is made up of variables or factors that organization has control over and can easily manipulate to suit its purpose as may be dictated by the prevailing circumstances such as capital, personnel, profit, procedure, policy, structure, objectives etc. the external business environment is made up extraneous factors such as technology, politics and government legislation. In addition are economic, socio-cultural and physical factors.
Adeye (2015:74), asserts that the business environment is complex, multifarious and vibrant in nature and has an in-depth impact on the endurance and development of the business. Having a worm’s eye view on the firm’s environment can be beneficial in the following ways: Revealing opportunities and threats, providing guidance for growth, making a firm strong or weak, continuous learning, Foster impression and Meeting rivalry, but many Nigerian manufacturing companies ignore their business environment and this has made their organizations to lose competitive advantage and decline in corporate organizational growth. It is based on this backdrop that this research examined the effect of business environment on organizational growth of manufacturing industry in Enugu State with five selected organizations as a case study.
1.2    Statement of the Problem
The Nigerian business environment in the last one decade has witnessed unsatisfactory progress cumulating into retarded growth rate, high rate of unemployment, low industrial output, coupled with poor demand in terms of services and tangible products. Energy crisis continued unabated forcing majority of the organizations to depend wholly on generator as a constant source of generating electricity, supply of petroleum product is epileptic in addition to frequent changes in pump price resulting into increase in the general price level of all products without any exception due to cobweb effect; most of the organizations are ravaged with strikes from time to time. The relationship between industrial representatives and government institutions and representatives keep nose-diving virtually on all matters, criminal activities, increasing at alarming and uncontrollable rate, exercising excessive control through plethora of rules and regulations with stringent conditions, tax policies without adequate provision of infrastructural facilities to ameliorate business operations.
Seemingly, many manufacturing firms in Enugu Metropolis do not consciously and strategically align these variables (internal environmental variables of structure, culture and resources) to address the opportunities/threats presented by the external environment in their drive for performance, and this forms the bane (worry) upon which this investigation will be anchored.
1.3    Objectives of the Study
The general objective of the study is to examine the effect of business environment on organizational growth of manufacturing industry in Enugu State. However, the specific objectives include:
1.    To determine the extent to which business environmental factors affect organizational growth of manufacturing industry in Enugu State.
2.    To identify the internal and external environmental factors that affect organizational growth of manufacturing industry in Enugu State.
3.    To assess the challenges militating against organizational growth as a result of business environment.
4.    To identify strategies that organizations can adopt in the wake of turbulent business environmental factors.
1.4    Research Questions
Based on the objectives of the study, the following research questions were raised.
1.    To what extent has business environmental factors affected organizational growth of manufacturing industry in Enugu State?
2.    What are the internal and external environmental factors that affect organizational growth of manufacturing industry in Enugu State?
3.    What are the challenges militating against organizational growth as a result of the business environment?
4.    What are the strategies that organizations can adopt in the wake of turbulent business environmental factors?    
1.5    Statement of Hypotheses
Based on the research questions, the following hypotheses were formulated.
Hypothesis One
H0:    Business environmental factors do not have a significant effect on organizational growth of manufacturing industry in Enugu State.    
H1:    Business environmental factors have a significant effect on organizational growth of manufacturing industry in Enugu State.    
Hypothesis Two
H0:    There are no internal and external environmental factors that affect organizational growth of manufacturing industry in Enugu State.
H1:    There are internal and external environmental factors that affect organizational growth of manufacturing industry in Enugu State.
Hypothesis Three
H0:    There are no challenges militating against organizational growth as a result of the business environment.
H1:    There are challenges militating against organizational growth as a result of the business environment.
Hypothesis Four
H0:    Organizations cannot adopt effective strategies in the wake of turbulent business environmental factors
H1:    Organizations can adopt effective strategies in the wake of turbulent business environmental factors.
1.6    Significance of the Study
So many people will benefit from this research work. Among them are managers of various corporate organizations, the researcher and the university. The management of various business organizations will benefit from this research work, because they will be familiar with the various internal and external environmental factors that affect corporate organizational growth and they will equally know the strategies to overcome those factors. The researcher will benefit from this research work because it is a pre-requisite for graduation. The university will benefit from this research work because it increases their data bank. The research work will also serve as reference material for further research on this topic.
1.7    Scope of the Study
This research work covered the extent to which business environmental factors affect corporate organizational growth, the internal and external environmental factors that affect corporate organizational growth, the challenges militating against organizational growth and strategies that organizations can adopt in the wake of turbulent business environmental factors. The organizations covered by this research work include: Innoson Technical and Industrial Company Limited, Emenite Nigeria Limited, Juhel Pharmaceuticals, Alo Aluminum Manufacturing Company and Nigerian Breweries Plc Ama, between 2016-2017.
1.8 Limitations of the study
The researcher encountered some impediments in the course of carrying out this research work. Among them were time, finance and uncooperative attitude of the respondents.
Time: The researcher carried out part of this research work using the time for lectures. This made the researcher to miss some lectures.
Finance: The researcher spent some money on transportation to the five manufacturing organizations. The researcher also spent some money in browsing and printing out relevant materials related to the research work.
Uncooperative Attitude of Respondents: The respondents of the five manufacturing organizations were economically with information, but when they found out that the research work was for academic purpose, they gave out useful information relevant for the research work.
1.9    Operational Definition of Terms
Business: This can be defined as all profit-directed economic and commercial activities that produce goods and services necessary to a nation’s standard of living
Business Environment: This can be defined as the combination of internal and external factors that influence a company's operating situation.
Organizational Growth: This refers to sustained increase in size, strength or quality of an organization. However, organizational growth means different things to different organizations.