STRATEGIC PLANNING AND COST EFFECTIVENESS AS CORRELATES OF SMALL AND MEDIUM SCALE ENTERPRISES PERFORMANCE IN OGUN STATE, NIGERIA
Keywords:
Cost Effectiveness, Small and Medium Scale Enterprises Performance, Strategic PlanningAbstract
The study examined the extent of interplay between strategic planning, cost effectiveness and small and medium scale enterprises (SMEs) performance in Ogun State, Nigeria. Four research questions guided the study. A descriptive survey research design was adopted to achieve the purpose of the study. A total of 400 SMEs, cutting across Ogun State were selected as sample for the study. A self-developed instrument, title: “Strategic Planning, Cost Effectiveness and SMEs Performance”, with 0.90 reliability coefficient value was used for data collection. The research questions was answered using descriptive statistic and the null hypotheses were tested using regression analysis. The analysis revealed that SMEs performance in terms of sales growth, market share growth, employment creation, profit margin and net profitability on green level, drastic reduction in debt accumulation and expansion of plant in Ogun State, maintained average level of performance within the year under study. SMEs performance increases with adoption of strategic planning. SMEs performance increases with consistent cost effectiveness. There was significant joint contribution of independent variables (strategic planning and cost effectiveness) on dependent variable (SMEs performance) (r = 0.455, p < .05). About 20% of the variance in SMEs performance was determined by the linear combination of strategic planning and cost effectiveness. The regression analysis further showed that there was significant influence of the independent variables on dependent variables (F = 2, 347 = 45.229, p<.05. It was recommended, among others, that government through its agencies should endeavour to organize capacity building workshop for managers from time to time in order to understand the salient roles and impacts of strategic planning and cost effectiveness on SMEs performance in Ogun State, Nigeria.
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