Abstract
The importance and contribution made by small and micro-sized enterprises (SMEs) in an economy has attracted widespread attention from researchers from the time small business research gained significant momentum in the early. Proper management of a company’s human resources is key to business survival in today’s world. Human capacity building can be particularly important for small firms. The need for human capacity building for SMEs in Nigeria is of great significance if we are to increase the performance and growth of SMEs and at the same time reduce inefficiency, low productivity and the rate of failures of small firm.
TABLE OF CONTENT
Title page
Approval page
Dedication
Acknowledgment
Abstract
Table of content
CHAPETR ONE
1.0 INTRODUCTION
1.1 Background of the study
1.2 Statement of problem
1.3 Objective of the study
1.4 Research Hypotheses
1.5 Significance of the study
1.6 Scope and limitation of the study
1.7 Definition of terms
1.8 Organization of the study
CHAPETR TWO
2.0 LITERATURE REVIEW
CHAPETR THREE
3.0 Research methodology
3.1 sources of data collection
3.3 Population of the study
3.4 Sampling and sampling distribution
3.5 Validation of research instrument
3.6 Method of data analysis
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS AND INTERPRETATION
4.1 Introductions
4.2 Data analysis
CHAPTER FIVE
5.1 Introduction
5.2 Summary
5.3 Conclusion
5.4 Recommendation
Appendix
CHAPTER ONE
INTRODUCTION
- Background of the study
The importance and contribution made by small and micro-sized enterprises (SMEs) in an economy has attracted widespread attention from researchers from the time small business research gained significant momentum in the early 1970’s (Rutherfoord and Weller, 2002). Work undertaken by Birch (1979) and Storey (1994), which gathered together the evidence from a wide range of studies, has provided policy makers and commentators with evidence of the contribution that small firms make, the difficulties they experience and various attempts and reasoning for government intervention in the sector. According to Beaver (2002), SMEs have an important role to play in a country's economy, and globally they contribute eighty per cent to a country's economic growth. For instance, “of the 3.7 million businesses in the UK, 99.2 per cent are defined as small businesses, employing fifty seven per cent of the workforce” (Denby, 2001). For many countries in Africa, SMEs and the informal sector represent over 90% of business and account for 60% of employment (International Institute for Environment and Development (IIED), 2005). For African countries to achieve long-term, sustainable growth, it is critical that they encourage and enable small and medium-sized entrepreneurs to launch and expand businesses, and enter the formal economy, thus helping SMEs to serve as an engine of growth. The common definition in OECD (Organization for Economic Co-operation and Development) countries is based on employment figures; correspondingly an SME has less than 500 employees (OECD, 1997A). In Nigeria, “Micro-enterprises” are those with 10 or fewer workers, “small enterprises” have from 11 to 50 workers, and” medium enterprises” lave from 51 to 100 workers. Censuses indicate that micro-enterprises comprise the lion's share of enterprises in Nigeria while there are a few medium enterprises (Parker and Torres, 1994). Small enterprises are almost non-existent. As well, micro-enterprises are indigenous while the medium-scale and larger manufacturing enterprises are dominated by Asian Indian) capital. Capacity building and development must be based on a need analysis derived from a comparison of “actual performance‟‟ and behavior with “required performance‟‟ and behavior. Capacity building and development is one of the major ways organization invests in the workforce for greater return today and even in the foreseeable future (Williams, 2007) Organizational effectiveness rests on the efficient and effective performance of workforce that makeup the organization. The efficient and effective performance of the workforce in turn, rest on the richness of the knowledge, skills and abilities possessed by the workforce. Capacity building and development in most organizations is a continuous act/exercise. The inexorable march of time and the ceaseless glamour for social change combine to make adaptability and continuing preparation of the workforce as inevitable as the initial acquisition of knowledge and skills. This cannot happen if employees‟ capacity building and development do not occur in an enterprise. In other to maximize the productivity and efficiency of the organization, every executive, manager or supervisor in a public or private organization has the responsibility and indeed the bounding duty to ensure the development of their employees who have requisite knowledge and expertise (Dada, 2004) Capacity building is like sharpening an existing skill in order to reflect the trends in technology and other social –cultural environmental changes of an organization. Productivity is the goal of today‟s competitive business world and capacity building can be a spring board to enhance productivity. The aim is to enable them contribute their full measure to the welfare, health and development of the organization (onah 2007). The main objective of capacity building and development in SMEs is to increase efficiency of employees with the resulting increase in corporate productivity. This accounts for why a large number of fund and time is expected by organization at one period or the order in the improvement of the skills of their employees at various levels. The principal intention of capacity building according to Akinola (2007), is to equip people with the knowledge required to qualify them for a particular position of employment, or to improve their skills and efficiency in the position they already hold. Manpower development on the other hand, implies growth and the acquisition of wide experience for future strategic advantages of the organization. Capacity building and development therefore, improves the effectiveness and efficiency of the employee. Therefore, the aim of this research is to know the current state, nature, procedure and method of capacity building and development used by the Guaranty Trust Bank for their employees and let‟s not forget that any organization that has no plan for the capacity building and development of its staff is less than dynamic for learning is a continuous process and acquired skills get obsolete when the environment changes. Also, a popular caption in the field of personnel management says, “If you think capacity building and development are expensive try ignorance‟‟. While capacity building and development prosper organization, ignorance destroys it. Therefore, workers like machines must be updated on constant basis or else, they end up becoming obsolete or misfit (Muhtar, 2007) Human capacity building is the “process of equipping individuals with the understanding, ikills, and access to information, knowledge, and training that enables them to perform iffectively” (UNDP 1992) in a society. Berg (1993) elaborates on this definition to highlight hree main activities: (i)Organization strengthening: the process of institutional development; ii)Procedural improvements: general functional changes or system reforms; and (iii) Skill nhancement, general education, OJT, and professional deepening in crosscutting skills. ollowing Argenti’s (1976) argument, the authors claim that most problems affecting SMEs re related to lack of managerial capability in owner-managers of SMEs. Though it is ifficult to determine what constitutes poor management, all problems of SMEs, be it larketing, operations, finance, personnel or distribution, are all essentially managerial ‘oblems. No matter what happened to these functions, managerial effectiveness could by jfinition have avoided or at least minimized their impact on the firm survival. Managers quire basic skills to establish organizational goals and determine appropriate strategies to hieve these goals. The success of SMEs in today’s turbulent markets depends largely on their ability to engage in environmental scanning activities in order to understand the behavior of and trends in their environment (Temtime, 2001). The processing, gathering and analysis of interoperating environmental data requires managerial competence and expertise. A previous study (Temtime, 2002) showed that most SMEs do not engage in actual strategic planning as they put too much emphasis on operational bits and pieces. Some prepare business plans just for external validation by banks and creditors rather than coordinating organizational activities. It is not uncommon that owner-managers often spend too much time fire-fighting rather than leading the firm. As the environment of SMEs is dynamic rather than static, turbulent rather than stable, and requires managerial agility and capability, SMEs should be assisted to think and act strategically. Hitt et al. (1996) found that management decision-making and organizational structure in SMEs revolves around the preferences and interests of owner-managers, who take all the major decisions and monitor all activities. While such approaches and structures enable strong control over the firm, organizational success or failure in SMEs is seriously affected by the managerial competencies of owner-managers. Al-Madhoun and Analoui (2003) studied 106 managers in Palestine and found an important relationship between managerial skills and small business development. Enhancing capacity of SMEs has a very great potential to spur economic growth.
- STATEMENT OF THE PROBLEM
The challenge of human capital development for developing nations is daunting. This is in consideration of how far ahead the rest of the world is and the enormous efforts and resources required of them to catch up. Nigeria's high population, vast socio-cultural diversity, yet-to-mature political culture and the great hope repose on her to emancipate the black-race, makes the challenge even more critical for us. The good news however, is that there is cause for great optimism because the nation has more than enough human capital potentials to surmount the challenge if harnessed, activated and effectively channeled. This research as it deals with the capacity building and development of employees in SMEs is intended to find out the efficiency and effectiveness of capacity building and development programme in SMEs. For this reason, it encounters numerous problems which range from:
1) Lack of qualified instructors and consultants to undertake capacity building courses,
2) Lack of essential capacity building tools, to
3) Lack of effective communication within the organization which makes it impossible for most employees to know about capacity building opportunities available to them.
1.3 OBJECTIVE OF THE STUDY
The main objective of the study is to impact of human capacity development in the survival of small scale enterprise. But to aid the completion of the study, the researcher intend to achieve the following specific objective;
- To ascertain the impact of capacity development on employee productivity
- To investigate the role of human capacity development on the quality of services provided by SMEs in Nigeria
- To examine the relationship between human capacity development and employee productivity
- To examine the effect of human capacity development on organizational profitability
- RESEARCH QUESTIONS
The following research questions were formulated by the researcher to aid the completion of the study
- Does human capacity development has any effect on organizational profitability?
- Is there any relationship between human capacity development and employee productivity?
- Does human capacity development play any role on the quality of services provided by SMEs in Nigeria?
- Does human capacity development has any impact on employee productivity?
- RESEARCH HYPOTHESES
To successfully complete the study, the following research hypotheses were formulated by the researcher:
H0: human capacity development does not have any impact on employee productivity
H1: human capacity development does have an impact on employee productivity
H0: there is no significant relationship between human capacity development and employee productivity
H2: there is a significant relationship between human capacity development and employee productivity
- SIGNIFICANCE OF THE STUDY
The current study seeks to raise ideas and issues in the hope that the various stakeholders and persons directly addressing issues related to human capacity building for small and micro enterprises in Nigeria will continue the discussion. Specifically, the findings of this study, it is hoped, will be beneficial to various key stakeholders as discussed below: The management of SME’s in Nigeria will gain a better understanding of the current human capacity building approaches to support Small and Micro sized Enterprises and the impact it has on the performance of SMEs. On the basis of the findings of the study, the management of these small and micro enterprises will implement decisions on HRM from an informed position. Policy Makers will acquire insight into the critical areas of support mechanisms for small and micro sized enterprises and accommodate them in their policies where applicable. Academicians and scholars will use the findings from the study as a source of reference for other researches. In addition, academic researchers may need the study findings to stimulate further research and like any other research, it will yield new information and act as a resource material for other readers. Financial institutions will use the information to offer human capacity building support for their customers so that they can service the credit extended by the bank and grow to be profitable and continue contributing to the economy
- SCOPE AND LIMITATION OF THE STUDY
The scope of the study covers the impact of human capacity development in the survival of small scale enterprises in Nigeria. But in the cause of the study, there were some factors which limited the scope of the study
- a) AVAILABILITY OF RESEARCH MATERIAL: The research material available to the researcher is insufficient, thereby limiting the study
- b) TIME: The time frame allocated to the study does not enhance wider coverage as the researcher has to combine other academic activities and examinations with the study.
- c) Organizational privacy: Limited Access to the selected auditing firm makes it difficult to get all the necessary and required information concerning the activities
1.8 OPERATIONAL DEFINITION OF TERMS
Human capacity development
Human Capacity Development (HCD) It is human capacities that make development and progress possible. That is why human capacity development (HCD), the upskilling of specialists, organisations and Networks, in the health sector is an important element of Germany's development cooperation.
SMEs
The European definition of SME follows: “The category of micro, small and medium-sized enterprises (SMEs) is made up of enterprises which employ fewer than 250 persons and which have an annual turnover not exceeding 50 million euro, and/or an annual balance sheet total not exceeding 43 million euro.”
Productivity
Productivity describes various measures of the efficiency of production. A productivity measure is expressed as the ratio of output to inputs used in a production process, i.e. output per unit of input.
1.9 ORGANIZATION OF THE STUDY
This research work is organized in five chapters, for easy understanding, as follows
Chapter one is concern with the introduction, which consist of the (overview, of the study), historical background, statement of problem, objectives of the study, research hypotheses, significance of the study, scope and limitation of the study, definition of terms and historical background of the study. Chapter two highlights the theoretical framework on which the study is based, thus the review of related literature. Chapter three deals on the research design and methodology adopted in the study. Chapter four concentrate on the data collection and analysis and presentation of finding. Chapter five gives summary, conclusion, and recommendations made of the study
