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Effects of Subcontracting on Modern Day Organizations

Ogbari , M. E. and Ajagbe, Akintunde M. and Isiavwe, David T. and Ade-Turton, Dayo Effects of Subcontracting on Modern Day Organizations. Australian Journal of Commerce Study. ISSN 2203-9422(Print), 2203-9430 (Online)

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Abstract

Many small businesses hire subcontractors to assist with a wide variety of functions. Subcontracting is a business strategy which came about in Nigeria as an outfall of the practices that were inherent in the industrial sector of the 1960s and 1970s. The adoption of subcontracting to most business organizations in advanced nations has been acknowledged to help such organisations attain organisational goals and aids economic growth and development. Empirical literature in Nigeria reported that the concept is not fully adopted despite emergence of manufacturing and services firms as a result of thriving economy. This study investigates the awareness, adoption and impact of the subcontracting strategy among business organizations in Nigeria. Quantitatively designed questionnaires were distributed to 120 respondents from selected manufacturing and service organisations around Lagos. A Multiple Regression Analysis was carried out to investigate the push and pull factors to subcontracting which could help to find out the decision of organisations to subcontract. Results from the Multiple Regression Analysis reported various levels of significance after testing H1-H4. However, the Pearson Correlation also reported different shared variance figures which is the amount of correlation that exists between both the push and pull factors to the subcontracting decision. However, results from analysis finds that majority of the respondents agreed that subcontracting has indeed assisted the company in realizing positive growth. This study has stirred up the need for a more detailed effort in the use of subcontracting as a tool for success in business activities even in light of the current waves of global financial crisis.

Item Type: Article
Uncontrolled Keywords: Subcontracting Strategy, Micro Entrepreneurs, Business Organizations, Multiple Regression, Nigeria.
Subjects: H Social Sciences > H Social Sciences (General)
Divisions: Faculty of Law, Arts and Social Sciences > School of Management
Depositing User: Mrs Hannah Akinwumi
Date Deposited: 24 Aug 2015 13:10
Last Modified: 24 Aug 2015 13:10
URI: http://eprints.covenantuniversity.edu.ng/id/eprint/5413

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