Business management and entrepreneurial performance

Abstract

The importance of the SSE sector as a source of income and employment for poor households in Kenya has been widely acknowledged since the publication of the ILO report of 1972. The performance of a firm depends on the management of the firm. In addition, the financing of a firm will also depend upon the structure and quality of its management. Small businesses lead the way in creating jobs. Small businesses are also the leaders in offering training and advancement opportunities to workers. They offer more general skills instructions and training than large ones, and their employees receive more benefits from the training than do those in larger firms. The performance of a firm is usually affected by various factors which entirely lie under the management of the firm itself. If a firm lacks sound management, its performance is affected negatively compared to a firm that is well-managed. The study analyzed the factors that affect the performance of small-scale enterprises. Data were analyzed using Statistical Package for Social Sciences (SPSS) computer software to generate frequency distribution tables; chi-square tests were used to compute the significance of the relationship between the independent variables. Data were then analyzed qualitatively to address research objectives. Chapter four presents data analysis and interpretation. The findings of the study indicate that majority of the respondents 17 (60.7%) indicated that they do not prepare a personal budget, 10 (35.7%) said they do while 1 (3.6%) did not comment. The preparation of a personal budget in planning isolates income and expenses not related to the business to expand on that which has been earned. The frequencies of a participants that prepared and those that did not prepare a personal budget at 2 df differed significantly ( x2 = 13.786, p< 0.05). The study further revealed that the majority of respondents. prefer taking chances in business affairs. Training in business management was one of the factors the researcher was interested in investigating. Most of the respondents were trained in business management and the results were significant at df compared to those who had no training (x2 = 34, 786, p<0.05). It was found that half of the respondents are guided by credit policy and the notion that visual inspection provides effective inventory control was agreed by most of the respondents. Lack of uncontrolled business growth is to them a serious problem. The study concludes that : Preparation of personal budget is necessary if a business is to thrive; most of the MSEs do not keep records ; the micro small-scale entrepreneurs prefers income security and taking chances in business affairs; the slow credit customers are a serious problem due to lack of credit policy. The following recommendations emerged: The study recommends that micro-scale entrepreneurs need more training, credit policy, keep personal records and should be given income security. Since the study focused on micro-small enterprises in Nairobi, a similar study should be replicated in other provinces not covered by this study.