1.1 BACKGROUND OF THE STUDY
Every country has its own business environment, just as every organization has its own set culture and business surroundings. Nigerian is one of the country that has its way of business, as far as the economy and business of Nigeria is concerned, the country has a fastest growing economy and is an attractive business location. Nigeria has been one of the most prominent members of the common wealth nations and is listed among the other countries.
Nigeria is one of those countries which rely heavily on their natural resources especially oil. The country provides an attractive place for investments in its different business sectors.
Starting up a business is a very complex matter. These are many factors which need to be taken into consideration in order to improve the competitiveness of the business operations to many sensitive issues. For this purpose, businesses are set up in order to achieve a given set objectives. Business requires profit making, survival, social responsibility; profit is the main motive of business and survival becomes most paramount amidst stiff competition. There is now an exponential increase in competition. Organization are now charged with the responsibility to continually find better ways to compete against lower labour cost, lower material cost, faster invocation, greater efficiency, higher quality and responsiveness to customers. All these challenges follow the forces of free enterprises and competition that require organization to either change or cease to exist.
A company therefore, cannot talk of existence without due regards to achieving a form of competitive advantage or another over other companies within the same industry. A company achieves an advantage over others when it can produce desired goods and services effectively and efficiently. This in turn depend on how the company perform with regards to driving quality up, cost down, driving increased speed and flexibility companies now consider bench marking against world class. Outsourcing becomes one strategic option that a winning company must consider. A company outsource in order to save on production cost and time. This becomes a solution for companies faced with challenges relating to higher cost of obtaining required raw material, high labour cost – among other things. Outsourcing avails organizations the opportunity to concentrate her core competencies on definable preeminence business area and provide a unique value for customers. Companies now outsource everything ranging from office work to the production of its basic component parts. Apart from cost considerations, other companies outsource in a bid to ensure better quality as well as ensuring faster new product development. Outsourcing then becomes one effective means for ensuring sustained competitiveness especially for companies that want to compete against other global players.
1.2 STATEMENT OF THE PROBLEMS
Crafting a wining strategy has become very critical to the survival of any business today. In a five year study conducted by Nitin Nohura, Willam Joyce and Bruce Roberts on called the evergreen project. They concluded that companies that competitive advantages over others excelled in four primary management practices; strategy, execution, culture and structure. Strategy comes top because it clearly defines the means to the end. The growth and expansion of any business requires that the company achieve a competitive advantage. Outsourcing becomes one strategic way to position one’s company to complete successfully.
This research work specially takes a look at the effect of outsourcing on business competitive positioning in the Nigeria Business Environment. It seeks to find out the core reasons why companies outsource the production of some of its goods and services in their bid to achieve competitive advantage. To this end, the researcher would want to know; what really is outsourcing? how do they outsource? Are there some challenges to outsourcing? Are there any effect of outsourcing on business competitive positioning? Are there any pitfalls to outsourcing?
1.3 OBJECTIVE OF THE STUDY
In line with the core objective of this research work, the researcher would want to find out the following and many more:
1.4 SCOPE OF THE STUDY
The success of any business rests on its ability to position itself competitively in the market place. Outsourcing remains one means to the end. Others could be by means of mergers and acquisition, joint venturing, integration, strategic alliances, low cost, differentiation – among others.
The work is however restricted to outsourcing as a means of achieving this competitive positioning in Nigeria business environment using a study of Nigeria Breweries in Enugu State, South Eastern Part of Nigeria.
1.5 RESEARCH QUESTIONS
To address this research problem, it is necessary to build a framework that will facilitate our understanding of what outsourcing is, as well as its effect on business competitive positioning in Nigeria business environment.
For the purpose of this study, the following research questions are asked:
1.6 LIMITATIONS OF THE STUDY
This research work is however subject to some limitations that made the findings not as extensive as intended. These limitations affected the sample size as the relative thoroughness involved in the entire exercise. Briefly, these and many more are some of the them:
1.7 DEFINITION OF TERMS
During the course of preparing this thesis, a number of terms and terminologies used are worth giving their simple definitions. The various concepts used are defined as follows:
advantage a company has over another with responsiveness to customers.