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|Title: ||Strategic orientation of small business entrepreneurs in Baguio City|
|Authors: ||Arguelles, Roberto Marasigan|
|Keywords: ||Environmental factors|
|Issue Date: ||Apr-2004 |
The focus of the study was primarily on the determination of the strategic orientation of entrepreneurs in Baguio City. Moreover, it dealt on the identification of the more dominant factors influencing their strategic orientation. Specifically, the study was conducted with the following objectives.
1. to determine the characteristics of the entrepreneurs in Baguio;
2. to determine the extent to which strategic choice motives are practiced by the entrepreneurs and the extent to which the environmental factors influence the entrepreneurs them;
3. to determine the difference in the extent to which the strategic choice motives are practiced and the level of influence of the environmental factors when the entrepreneurs are grouped according to their characteristics;
4. to determine the level of strategic orientation of entrepreneurs in Baguio City; and
5. to determine relationship between the combined effects of the extent to which the entrepreneurs’ strategic choice motives are applied and the extent to which the environmental factors influence the entrepreneurs, and their level of strategic orientation.
The study included one hundred thirty two small business entrepreneurs registered with the Department of Trade and Industry from 1998 to 2002 in Baguio City. The study was conducted from April 2003 to March 2004.
The following summary of findings meet the objectives set forth in the research study.
Most of the entrepreneurs in Baguio City are 41 to 50 years of age, comprising more than 30%. The 31-40 year group and those who are 30 years or younger, comprising a little less than 30% follow this group. More than 58% are females, while less than 42% are males. More than 63% of them have been in the business for just 10 years and below, more than 21% have been operating from 11 to 20 years, while the rest of the 15% were in business for 21 years or more.
The five strategic choice motives are generally exhibited to a great extent. Ratings given were: self-actualization (4.0), nature of work (3.94), desire for autonomy and power (3.82), and affiliation motives (3.96).
Three of the four external dimensions influence the entrepreneurs to a great extent. These are socio-cultural, 4.04; economic, 3.61; and technological dimensions. Moderate extent of influence of 3.33 is seen for political-legal dimension of the external environment. Consistently, the four firm dimensions greatly influence the entrepreneurs with scores of 3.96 for marketing, 3.46 for production/technical 3.78 for human resource and 3.79 for finance.
The test of statistical difference of opinions when the respondents were grouped according to age, and number of years in the business yielded no significant difference, at 0.05 level of significance, as to the extent to which the strategic choice motives are exhibited and the extent to which the external and firm dimensions influence the entrepreneurs. Thus, there was no support for this hypothesis. Moreover, regarding the gender characteristics, there was no significant difference in the extent to which strategic choice motives are exhibited and the extent to which the external environment (socio-cultural, economic, technological and political-legal) and firm dimensions (marketing, production/technical, and finance) influence the entrepreneurs.
However, there is significant difference in the extent to which human resource influence the entrepreneurs when they are grouped according to their ages at 0.05 level of significance. It has been found out that such influence is weakest (moderate) among the oldest ( > 51) group of entrepreneurs.
The entrepreneurs consistently agree on their level of strategic orientation along intrinsic, 4.05; opportunity, 3.93; people-orientation, 4.08 and integrated growth and capability building; 4.05.
It was found out that the strategic choice motives, when combined with the various environmental factors influence the level of strategic orientations of the entrepreneurs in Baguio City: Strategic choice motives and environmental factors moderately influence intrinsic and integrated growth capability building orientations of the entrepreneurs. Self- actualization, when combined with any of the environmental factors influences to a high degree the opportunity and people orientations of the entrepreneurs. Nature of work, when combined with any of the environmental factors influence to a high extent, the people orientations of the entrepreneurs.
Based on the findings of the study, the following conclusions were drawn.
Typically, entrepreneurs in Baguio City are female who are about 50 years of age or younger and have been in the business for a relatively short period of time or maybe described as in the start-up or survival stage. The results of the study support the previous study of Arguelles (1996), Robichaud (2001) and Gasse, et al. (1997) regarding the age factor. NFWBO (1987) and Arguelles (1996) found similar results on the gender factor. However, Scottish Enterprise’s (1977) study does not support this finding. Regarding the findings on the number of years in business, Robichaud (2001) found similar results.
In general, the small business entrepreneurs seem to be characterized by a desire for self-development, a need for constant inquiry, a need for integrating future growth synergistically with the internal strengths and with the exigencies of an external environment, and a vision that takes into account the people factor in future growth. The results of the study support the previous findings of Manimala (1992), McClleland and Burnham (1976), Curran (1994). There is still a room for improvement on the extent to which the entrepreneurs practice the strategic choice motives. Likewise, interventions may be necessary to fully take advantage of the influences of the external and firm dimensions of the environment on the entrepreneur. Political-legal areas concerning government’s assistance to the entrepreneurs, making tax legislation conducive to them, and the promotion of free enterprise spirit are the things where improvements are needed the most. It can be concluded that the entrepreneur’s characteristics (age, gender, and number of years in the business) do not play a role on how the strategic choice motives are exhibited by the entrepreneurs. Moreover, the characteristics of the entrepreneurs do not significantly influence how they perceived the effects of the external environmental factors as well as the firm dimensions, specifically marketing, production/technical and finance aspects. Interestingly, the age characteristics of the entrepreneurs significantly influence how they perceived the human resource aspects of the enterprises. From the generally similar or equal perceptions of the respondents on the extent of practice of strategic choice motives and the extent of influence of the environmental factors, it can be concluded that interventions can be generally designed to improve the levels of practice and influence and to be made applicable to the entrepreneurs regardless of age, gender and number of years in the business. However, entrepreneurs who are comparatively older ( > 510 need to take advantage and recognize to a greater extent, the influence brought about by the human resource dimensions of the firm environment. More efforts are necessary on the following aspects: stabilization of the supply of skills; stability and predictability of cost of labor; and provision for training and development.
There is a need to enhance the level of strategic orientation of the entrepreneurs in Baguio City along intrinsic, opportunity, people and integrated growth and capability building orientations.
The data collected for the present study offered an opportunity to test the hypothesis of the combination of the strategic choice and population ecology models. Multiple correlation analysis was performed to see its relationship to strategic orientation. From the analyses, the following conclusions were drawn: the strategic choice motives – self-actualization, when combined with any of the environmental factors have a high correlation with the opportunity orientation of the entrepreneurs; the strategic choice motives – self-actualization and nature of work, when combined with any of the environmental factors have a high correlation with the people orientation of the entrepreneurs; the self-actualization, nature of work and desire for autonomy and power when combined with any of the environmental factors have moderate correlation with the intrinsic orientation; the nature of work, desire for autonomy and power, as well as affiliation motives when combined with any of the environmental factors have moderate correlation with opportunity orientation; the desire for autonomy and power, status and affiliation motives when combined with any of the environmental factors have moderate correlation with people orientation as well as with the integrated growth and capability building orientation of the entrepreneurs; the status motive when combined with economic, technological, political, marketing, production/technical and human resource environments have slight correlation with intrinsic orientation of the entrepreneurs; the status motives when combined with the economic, political-legal, technological, marketing and human resource environments have slight correlation with intrinsic orientation; the status motives when combined with political-legal and production/technical environments have slight correlation with the opportunity orientation.
The findings, conclusions and insights of this study are interrelated. Relating one implication with another results into a proposed model, which can guide not only small business entrepreneurs but also those who are actively involved in the promotion and development of small business enterprises.
The researcher proposes the strategic orientation model of small business entrepreneurs.
The model emphasizes the strong influence of his self-actualization and the environmental factors to his people and opportunity orientation. On the other hand, his nature of work when combined with the environmental factors, greatly influence his people orientation. Moderate level of influence is seen on the combined effects of the strategic choice motives and the environmental factors on the other two orientations – intrinsic and integrated growth and capability building.
The model shows that to strengthen an entrepreneur’s people and opportunity orientations, efforts are necessary to improve the extent of practice of self-actualization and nature of work motives, coupled with making actions to take advantage of the influences brought about by the environmental factors. These can be done through the following further recommendations: enhancing self-actualization; institutionalize change as the enterprise’s goal; instill the desire to be innovative; and developing critical human resources.
As to the external environment-political-legal, as this may be beyond the control of the entrepreneurs, it is recommended that government may look into the different laws and regulations affecting small business enterprises.|
|Description: ||Thesis (Ph.D. : Philosophy in Management)-- University of the Cordilleras, Baguio City, 2004.|
|Appears in Collections:||University of the Cordilleras|
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