Effects Of Strategic Factors On Business Performance Of ...

Effects Of Strategic Factors On Business Performance Of Small Scale Family

Businesses In Goma Town, Democratic Republic Of Congo

by

Ndagano Alain Birindwa

A thesis presented to the School of Business and Economics

of

Daystar University

Nairobi, Kenya

In partial fulfillment of the requirements for the degree of

MASTER OF BUSINESS ADMINISTRATION

in Strategic Management

May 2019

Daystar University Repository

Library Archives Copy

APPROVAL

EFFECTS OF STRATEGIC FACTORS ON BUSINESS PERFORMANCE OF SMALL SCALE FAMILY BUSINESSES IN GOMA TOWN,

DEMOCRATIC REPUBLIC OF CONGO

by

Ndagano Alain, Birindwa

In accordance with Daystar University policies, this thesis is accepted in partial fulfillment of requirements for the Master of Business Administration degree.

Date:

_______________________________ Mercy Njagi, MBA, 1st Supervisor

________________________

_______________________________ Laban Chesang‟, PhD, 2nd Supervisor

________________________

_______________________________ Samuel Muriithi, PhD, HoD, Commerce

________________________

_______________________________ Evans Amata, PhD, Dean, School of Business and Economics

________________________

ii



Copyright©2019Ndagano Alain Birindwa

iii



DECLARATION

EFFECTS OF STRATEGIC FACTORS ON BUSINESS PERFORMANCE OF SMALL SCALE FAMILY BUSINESSES

IN GOMA TOWN, DEMOCRATIC REPUBLIC OF CONGO

I declare that this thesis is my original work and has not been submitted to any other college or university for academic credit.

Signed: __________________ Ndagano Alain Birindwa 11-1563

Date: __________________

iv



ACKNOWLEDGEMENT

I acknowledge the Almighty God for His grace and strength since I started this

journey to its completion. My immense appreciation goes to my supervisors; Mrs.

Mercy Njagi and Dr. Laban Chesang for their direction and insights throughout this

research.

I am deeply grateful to my parents, Faustin Ndagano and Ghislaine Nabintu

for spiritually and financially supporting me, and most importantly, for having

implanted in me the spirit of distinction and persistence, without which I would have

not finished this work. It would be remiss of me not to mention my sister Annie

Ndagano and her husband Nestor Vuambale and my other lovely siblings, Bertine N.,

Judith N., Marline N., Bertin N., Christelle N. and Angelo N. who have always been

there for me, their love is precious.

I extend my appreciation to Dr. Joanes Kyongo, Dr. Samuel Muriithi, and to

all Daystar University lecturers who guided me through my MBA journey. My sincere

gratitude to Denis Kalenga for being the best friend anyone could ever ask for. Last

but not least my humble appreciation to Christian Rusangiza, Patient Muke, Jeremy

Nsiku, Aubin Lushombo, Clovis Bubala, Tresor Dunia and Harmonie Mukendi for the

moral support and encouragements they showed me during this journey.

v



TABLE OF CONTENTS

APPROVAL ................................................................................................................. ii DECLARATION ..........................................................................................................iv ACKNOWLEDGEMENT .............................................................................................v TABLE OF CONTENTS ..............................................................................................vi LIST OF TABLES ..................................................................................................... viii LIST OF FIGURES ......................................................................................................ix LIST OF ABBREVIATIONS AND ACRONYMS ......................................................x ABSTRACT ..................................................................................................................xi CHAPTER ONE ............................................................................................................1 INTRODUCTION AND BACKGROUND TO THE STUDY .....................................1

Introduction to the Study ...........................................................................................1 Background to the Study ............................................................................................2 Statement of the Problem ...........................................................................................9 Purpose of the Study ................................................................................................10 Objectives of the Study ............................................................................................10 Research Questions ..................................................................................................11 Justification of the study ..........................................................................................11 Significance of the Study .........................................................................................11 Scope of the Study ...................................................................................................12 Limitations and Delimitations the Study .................................................................12 Definition of Key Terms ..........................................................................................13 Chapter Summary ....................................................................................................14

CHAPTER TWO .........................................................................................................15 LITERATURE REVIEW ............................................................................................15

Introduction ..............................................................................................................15 Theoretical Review ..................................................................................................15 General Literature Review .......................................................................................18 Empirical Literature Review ....................................................................................26 Conceptual Framework ............................................................................................31 Chapter Summary ....................................................................................................32

CHAPTER THREE .....................................................................................................33 RESEARCH METHODOLOGY.................................................................................33

Introduction ..............................................................................................................33 Research Design.......................................................................................................33 Population ................................................................................................................34 Target Population .....................................................................................................34 Data Collection Instruments ....................................................................................35 Data Collection Procedures ......................................................................................35 Data Analysis Plan ...................................................................................................36 Pre-test of Data Collection Instruments ...................................................................36 Ethical Considerations .............................................................................................36 Research Limitations ...............................................................................................37 Chapter Summary ....................................................................................................37

CHAPTER FOUR ........................................................................................................38 DATA PRESENTATION, ANALYSIS AND INTERPRETATION .........................38

Introduction ..............................................................................................................38

vi



Presentation, Analysis and Interpretation ................................................................38 Strategic Factors of the Small Scale Family Businesses .........................................45 Role Clarity and Record Keeping ............................................................................47 Appropriate Skills and Employees Trainings ..........................................................49 Summary of Key Findings .......................................................................................65 Chapter Summary ....................................................................................................67

CHAPER FIVE ............................................................................................................68 DISCUSSIONS, CONCLUSIONS AND RECOMMENDATIONS ..........................68

Introduction ..............................................................................................................68 Discussions ..............................................................................................................68 Conclusion ...............................................................................................................72 Recommendations ....................................................................................................73 Areas for Further Research ......................................................................................74

REFERENCES ............................................................................................................75 APPENDICES .............................................................................................................81

Appendix I: Questionnaire ..................................................................................81 Appendix II: Questionnaire‟s French Version .....................................................85 Appendix III: List of SSFBs registered with FEC ................................................90 Appendix IV: Research Permit and Research Authorization ................................97 Appendix V : Ethical Approval .............................................................................99 Appendix VI : Anti-Plagiarism Report ................................................................100

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LIST OF TABLES

Table 4. 1: Response Rate ......................................................................................39

Table 4. 2: Level of Management of the Respondents ............................................42

Table 4. 3: Organization Main Business Activity ...................................................44

Table 4. 4: Part of Owner’s Family........................................................................45

Table 4. 5: Shared Vision .......................................................................................46

Table 4. 6: Owner’s Leadership .............................................................................46

Table 4. 7: Role Clarity ..........................................................................................47

Table 4. 8: Record Keeping ....................................................................................48

Table 4. 9: Confidence in External Management ...................................................48 Table 4. 10: Appropriate Skills .................................................................................49

Table 4. 11: Employee’s Trainings ...........................................................................49

Table 4. 12: Business Money VS Owners Money .....................................................50

Table 4. 13: Culture and Traditions .........................................................................51

Table 4. 14: Mean and Std. Deviation values for Strategic Factors ........................51

Table 4. 15: Sales .....................................................................................................52

Table 4. 16: Market Share ........................................................................................53

Table 4. 17: New Market ..........................................................................................53

Table 4. 18: Employee’s Relationship ......................................................................54

Table 4. 19: Employee’s Commitment ......................................................................55

Table 4. 20: Annual Revenue ....................................................................................55

Table 4. 21: Firm Profitability .................................................................................56

Table 4. 22: Family Satisfaction ...............................................................................57

Table 4. 23: Owner’s Satisfaction ............................................................................57

Table 4. 24: Mean and Std. Dev values for Performance Indicators .......................58

Table 4. 25: Shared Vision on Business Performance .............................................59

Table 4. 26: Owners Leadership on Business Performance.....................................59

Table 4. 27: Roles Clarity and Records Keeping On Business Performance ..........60

Table 4. 28: Confidence in External Managers on Business Performance ..............61

Table 4. 29: Employees Trainings on Business Performance ..................................61

Table 4. 30: Business Capital and Owner’s Money Separation ...............................62

Table 4. 31: Culture and Traditions on Business Performance ...............................63

Table 4. 32: Mean and Std. Dev for Factors Effects on Performance .....................64

Table 4. 33: Model Summary....................................................................................64 Table 4. 34: ANOVA Results ....................................................................................65

Table 4. 35: Reliability Test......................................................................................65

viii



LIST OF FIGURES

Figure 2. 1: Ownership and Management Style .......................................................27

Figure 2. 2: Conceptual Framework ........................................................................31

Figure 4. 1: Age of the Respondents ........................................................................40

Figure 4. 2: Gender of the Respondents ...................................................................41

Figure 4. 3: Highest Education Level of Respondents .............................................42

Figure 4. 4: Length of Running the Business ...........................................................43

ix



LIST OF ABBREVIATIONS AND ACRONYMS

CEO

FB

SME

SSFB

GPRSP

DRC

FEC

IFC

OPEC

RBV

SPSS

US

BSC

IMF

Chief Executive Officer Family Business Small and Medium Enterprises Small Scale Family Business Growth and Poverty Reduction Strategy Paper Democratic Republic of Congo Federation of Enterprises of Congo International Finance Corporation Office of Promotion for Congolese Small and Medium Enterprises Resource-Based View Statistical Package for Social Science United States Balance Score Card International Monetary Firm

x



ABSTRACT

Family businesses are an important global pillar which has shaped business landscape.

It has been a source of employment, income generation and wealth creation for

centuries. This study sought to establish the effects of strategic factors on business

performance of small-scale family businesses (SSFBs). The objectives of the study

were; to identify strategic factors that influence small-scale family businesses

performance, to find out how small scale family businesses measure performance and

to investigate the extent to which strategic factors affect performance of small-scale

family businesses. Descriptive statistical tools helped in describing data and

determining the respondents‟ degree of agreement with various statements. The study

was conducted in Goma town in the Republic Democratic of Congo. The research

collected primary data from managers of SSFBs companies in Goma using

questionnaires and were then analyzed using Statistical Package for Social Sciences

(SPSS 22.0.0.0). Using business and family dimensions as indicators, the study found

that 66.6% of small scale family businesses used appropriate skills as a strategic factor

to enhance performance. The findings also showed that culture and traditions affected

business performance at 50.8%. This findings show that firm culture and tradition did

not have a significant impact on business performance for SSFBs in Goma. The study

recommends that for small scale family businesses to enhance performance, the

owners of SSFBs need to share their vision with employees because a shared vision

not only strengthens the company but also unites family members.

xi



CHAPTER ONE

INTRODUCTION AND BACKGROUND TO THE STUDY

Introduction to the Study

Family businesses have shaped business landscape for centuries and still

remain an important pillar. It is a source of employment, income generation, and

wealth creation in developing countries (Colli & Rose, 2008). In the simplest words,

Chrisman, Sharma, Steier, and Chua (2013) consider family involvement, ownership,

management and business succession as components of family business. These

businesses are small, medium, or large and have existed for centuries (Colli & Rose,

2008). Siebels and Aufseß (2012) argued that family business research field is

relatively young in developing countries compared to established fields such as

strategic management and finance.

In every business regardless of its form of ownership, there are some specific

entities that guide firm‟s performance; these entities are called strategic factors.

Strategic Factors are those elements that a business or organization needs to use right

in order to succeed with its key stakeholders, that is, its customers, suppliers,

employees, owners and any other organization, business unit or individual that

influences its actions (Kenny, 2001). Internal and external factors play a major role in

every business environment. World Bank (2011) reported that in the case of family

business internal factors like innovative capacity, managerial training and experience,

education and skills, leadership and information management and financial

management affect their performance. External factors like technological,

infrastructure and governance are often beyond the control of family members and

owner of the business while internal factors like innovative capacity, managerial

training and experience, education and skills are in their hands (World Bank, 2011).

1



A good business performance is considered as the indicator of a successful

enterprise. According to Nicolae and Violeta (2017) company is considered

performing if it can satisfy the interests of all partners: shareholders, employees,

suppliers, customers, creditors. Radu and Taicu (2009) Considers as performing the

company, which manages to create value for its shareholders and this, is realized

when the return on capital invested is higher than the funding sources. It is not enough

for a company to only have profit but also to create value.

Background to the Study

Strategic Factors

Family business scholars are still trying to understand those Chrisman, Chua,

Chang and Kellermanns (2007), strategic factors that need to be used by family

businesses for performance advantages. It is widely recognized that family businesses

play a significant role in the global economy. Family businesses need to pursue a

planned and controlled business performance, to attain a sustainable and profitable

growth.

In the quest for a positive performance, strategic factors need to be monitored

and used appropriately. According to Adisa, Abdulraheem, and Mordi (2014),

effective use of these strategic factors will affect performance of small-scale family

businesses. Among them Adisa et al. (2014) noted managerial training, information

management with a good record keeping, separation between business capital and

family money and presence of appropriate skills. Most small-scale businesses that are

considered as family owned are managed by their owners and closer family members

and forget to hire experts to run the businesses at a certain level which is very crucial

for the business (Rajaram, 2018). In the same perspective, Neff (2015) suggested a

2



number of strategic factors that have proven to be valuable in the family business

success. He noted that confidence in external managers; a shared vision and role

clarity are elements that family business owners need to consider in order to move to

the next level in a competitive business environment.

Family Businesses

Defining the term “family business” or “FB” is widely and exclusively

conditioned by regional location. Astrachan, Sabine and Kosmas (2005) explain that

in European countries like (Belgium, Finland, and Slovenia) specific features are

considered to determine a family business. He noted: family influence on power,

involvement and culture. “Power” in this case is the level of ownership and

managerial control. “Involvement” means the level of understanding and participation

of family members into the business; this is for example the number of management

and ownership succession that has happened over time. “Culture” deals with values

and commitment of family members towards the enterprise. Astrachan et al. (2005),

further said, in Denmark and France direct ownership is considered as a necessity for

a business to be classified as family business but, for example, the involvement of

family funds is sufficient to satisfy the indicated ownership criterion.

The Annual Report on European SMEs 2013/2014, considers a business as

family owned business, a firm which the majority of decision-making is in the

possession of the natural person(s) who established the firm, or their spouses, parents,

child or children‟s direct heirs, the majority of decision-making rights are indirect or

direct, at least one representative of the family or kin is formally involved in the

governance of the firm the companies meet the definition of family enterprise if the

person who established or acquired the firm (share capital) or their families or

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descendants possess 25 per cent of the decision-making rights mandated by their

share capital (Patrice, Gagliardi, Cecilia, & Nuray, 2014).

In fact Family businesses are among the key sources of job generation in most

countries and represent the majority of companies in the world (Hacker & Dowling,

2012). The presence of these businesses to a country‟s economy is very crucial hence

their stability is required for global economic growth. The influence of FBs is that

they have both economic and social impact (Brigham, 2013). According to Osunde

(2017) FBs are within all categories of businesses, from micro to global enterprises

whether in America, Europe, Asia or Africa. Globally during their start-up stages

most family businesses in developing economies tend to work with informal

organizational structures, owner-manager and tend to only appoint family members as

CEOs (Gonzalez, 2006)

In South Africa, family businesses account for 50% of the economic growth of

South Africa (Fishman, 2009). South African‟s government recognizes the

importance of entrepreneurial activity as means of energizing the country‟s economy

and encouraging growth and development (Maas & Diederichs, 2007). South Africa

family businesses have maintained a consistent level of performance over the last

three financial years (PWC, 2016-2017). These businesses are confident about the

future with 84% expecting to grow and 22% expecting to grow quickly and

aggressively (compared with 15% globally expecting similarly fast growth). Among

those South Africa family businesses expecting to grow by 10% or more, the majority

(83%) will use external financing to help fund their growth (PWC, 2016-2017). This

growth is primarily achieved through an increase in their core business in existing

markets, coupled with expanding into new markets and acquisitions, and also

4



innovation, attraction and retention of talents, and a progressive integration of

professionalization in the firm management (Bureau for Economic Research, 2016).

It has been also noted in Kenya that Small-Scale Family Business sector has

the potential of bringing millions of people from the subsistence level including the

informal economy to the mainstream economy (Wanjohi & Mugure, 2008). Small-

scale family owned businesses contributed over 50% of new jobs created in 2005

(Kenya National Bureau of Statistics, 2006). Recognizing the role played by SMEs

and SSFBs in the Kenya economy, Kenya government plans to strengthen SMEs

through its Vision 2030 program to become the key industries for tomorrow by

improving productivity and innovation (Ministry of Planning, 2007).

Regarding DRC, Small-scale family businesses together with SMEs are the

most used form of business, (IMF Country Report, 2016). Growth and Poverty

Reduction Strategy Paper (GPRSP) aims to improve population‟s living conditions by

laying strong foundations for economy diversification by strengthening infrastructure,

improving governance and institutional capacity, and facilitating a rapid development

of private sector for economic growth. Diversification of the economy in DRC is

required in order to build a strong and sustainable economy for the future said the

former prime minister of DRC (Mponyo, 2018). The former prime minister insisted

that this diversification must be conduct by providing a better business climate for

small scale family business and SMEs in general which are direct agents of

development and industrialization of the country‟s economy.

In recent years an explosion of many small scale FBs has been witnessed

where owners surround themselves with staff recruited from the family community

(Lwanzo, 2009). In DRC, more than 3,730 companies affiliated with the Office of

5



Promotion for Congolese Small and Medium Enterprises (OPEC) operates in the

country, they are either private or family in nature. This sector represents more than

90% of labor market; it creates relatively more jobs than other sectors (Balutidi,

2008). It allows the use of local resources and contributes to the mobilization of

national savings and help on the decentralization of the economy. Moreover this

sector in DRC is facing many of the following difficulties: institutional,

psychological, economic and financial, administrative, technological, legal and

organizational, and in view of this situation it is important to cover the economic

structures related to this sector and to consider integration and promotion strategies to

help FBs grow from small scale businesses to well-structured enterprises (Balutidi,

2008). Family businesses topics in the Democratic Republic of Congo have not been

discussed enough though in other places in Africa and Europe it is a growing field of

research.

Small Scale Family Business

Small-scale family businesses are a subgroup of privately owned firms.

Families either own them or particular families have a very strong influence on their

management (Osunde, 2017). They are very small in size and are made of few

employees and their annual revenue is very limited. Under the (Fair Work

Ombudsman, 2009) small scale family businesses range from fifteen employees, fifty

employees according to the European Union, and fewer than five thousand

employees, to qualify for many U.S. Small Business Administration programs. Small-

scale family businesses in many countries include service provision

or retail operations such as hardware stores, small grocery stores,

restaurants, guesthouses, and very small-scale manufacturing. Small-scale family

businesses have similar characteristics with SMEs but the only difference concerns

6



the interaction between ownership, business and family (Gupta, Levenburg, Moore,

Motwani, & Swartz, 2008).

Furthermore SME is considered as any company regardless of its legal form

that has less than 200 employees and whose total investment does not exceed 350.000

USD. SMEs can be legally registered as individually owned or owned by group of

persons in DRC. They are classified following their annual turnover, which should not

exceed 400.000 USD. These SMEs are characterized by their size and management

style, they are privately owned or family owned. Management of SMEs is generally

very difficult, managers‟ focus mostly on their survival and development (Entreprises,

2009).

Strategic Factors and Business Performance of Family Business

Strategic factors are the key features around which organization managers

must focus on in order to succeed. For a family business to grow good management of

specific strategic factors like managerial training, record keeping, separation of

business capital from owner family money, and appropriate skills attraction which

leads to innovative capacity need to be wisely used (Adisa et al. 2014). Coad,

Frankish, Roberts, and Storey (2013), and Neff (2015) added that confidence in

external managers, roles clarity and a shared vision are considered as strategic factors

and play a significant role in business performance. These strategic factors are linked

to the business performance of the firms.

In family business environment a good performance is regarded as a reflection

of success and particularly as an indicator of continuity and trans-generational wealth

creation (Craig & Moores, 2006). Explaining firm performance has been a huge

challenge in entrepreneurship research. Verboncu and Zalman (2005), consider that

7



"firm performance is a particular result in the management, economics, marketing

domain etc. which gives characteristics of competitiveness, efficiency and

effectiveness to the organization and to the structural and procedural works. Siminica,

Circiumaru and Dalia (2012), considers an enterprise is performing well, when it is

efficient and effective. Therefore the performance is a function of two variables,

efficiency and efficacy. While efficacy reflects the achievement of external

expectations, efficiency is measured by the achievement of internal environment of a

firm. According to Siminica et al. (2012) for a firm to be efficiency, its management

needs to use those internal strategic factors correctly at their operational level by

linking them with a smooth company‟s performance plan (Bridge, O'Neill, & Cromie,

2003).

In order to assess business performance, many performance models have been

developed (Cross & Lynch, 1988; Kaplan & Norton , 1996; Kueng, 2000). The

process performance measurement system of Kueng (2000) is important, and is

visualized as a “goal and performance indicator tree” with five process performance

perspectives: financial, customer, employee, societal, and innovation views. The other

model called Balanced Scorecard (BSC) was developed by (Kaplan & Norton , 1996).

This particular model has a four-dimensional approach to organizational performance:

managerial, customer, internal business process, and “learning and growth”

perspectives. This study has been based on Núñez-Cacho and Torraleja (2012) Work,

which proposes specific family business indicators to evaluate a family business‟

performance, taking in to account both company and family characteristics. Therefore,

this study used a performance scale that integrates the duality of these organizations

(that is, business and family) and measures performance with several groups of

variables, in accordance with (Delaney & Huselid, 1996).

8



Statement of the Problem

Small scale family businesses are the most used business model in DRC but

the majority of these businesses fail to grow or to remain sustainable for the next

generation to take over, according to the (IMF Country Report, 2016). In contrast

SSFBs play an important role in sustaining and diversifying the country economy

from the mineral sector (IMF Country Report, 2016). Some reports and researches

have tried to understand the difficulties encountered by SMEs together with SSFBs to

access credit in Democratic Republic of Congo and their impacts on the country

economy. KfW Bankengruppe, (2012) in its report focuses on the performance of

small-scale family businesses in DRC and underlined that the performance is not very

good due to a lack of financial support.

Balutidi (2008) researched on the contribution of SMEs and SSFBs to the

economic development of DRC. Lwanzo (2009) researched in Bukavu town about

small-scale family businesses but the focal point was based on the existence and

sustainability, through growth and succession, of the competitive advantage deriving

from the family specificities of the business. According to Adisa et al. (2014), Coad et

al. (2013) and Neff (2015) strategic factors like managerial training, record keeping,

separation of business capital from owner family money, appropriate skills,

confidence in external managers, roles clarity and a shared vision play a significant

role in family business performance. These factors are variables that monitor and

influence family businesses performances. Business performance in a SSFB

environment is measured following its business and family characteristic. The current

work will be looking at the effects of these factors on the performance of small scale

family businesses in DRC with a focus on Goma town.

9



There is a lot of literature touching on small-scale family business in different

perspective such as succession and finance discussed by regional scholars such as

Muriithi and Wachira (2016), and Olatunji (2013) and other global scholars

Hernández and Peña (2008), Pearce and Ensley (2004), and Ejemobi (2013) but very

few have discussed a case on DRC. Balutidi (2008) researched on the contribution of

SMEs and SSFBs to the economic development of DRC while Lwanzo (2009)

researched about small-scale family businesses but the focal point was based on

succession in Bukavu town. KfW Bankengruppe, (2012) in its report focuses on the

performance of small-scale family businesses in DRC and underlined that the

performance is not very good due to a lack of financial support. This study hence has

focused on strategic factors that are used by SSFBs to enhance performance. The

research was built on related regional literature on small-scale family businesses in

general and particularly on the effects of strategic factors on performance of small-

scale family businesses.

Purpose of the Study

The purpose of this study was to examine the effects of strategic factors on

performance of small-scale family businesses in Goma Town, DRC.

Objectives of the Study

(i) To identify strategic factors that influence small-scale family businesses

performance.

(ii) To find out how small scale family businesses measure performance.

(iii) To investigate the extent to which strategic factors affect performance of

small-scale family businesses.

10



Research Questions

(i) What are the strategic factors that influence performance of small-scale family

businesses?

(ii) How are small-scale family businesses measuring performance?

(iii) To what extent do the identified strategic factors affect small-scale family

business performance?

Justification of the study

The research was conducted in Goma, DR Congo. This is because Goma is

one of the fastest economically growing city in DR Congo. Goma is also known for

its promotion of Small and medium enterprises due to its diverse commercial

interactions with the Eastern Africa Community. Several SSFBs are created in Goma

on a monthly basis, but little knowledge is available to know how they operates and

manages their daily business routines. It has been seen essential to the research to

look with a scientific view into this field to identify the nature of their performances.

The researcher believed that identifying those strategic factors used in these

businesses will help to know at what extend they affect performance of these SSFB‟s.

Significance of the Study

The findings from this study are beneficial to owner and managers of family

businesses by using research findings to develop strategies for business performance.

The outcomes of the study gives insight to owners and managers of small and medium

scale family businesses on how to manage different obstacles facing SSFB‟s such as

family members and other employee‟s cohabitation to ensure a good performance and

sustainability of family businesses. This study also gives insight to DRC government

on the factors affecting performance of SMEs, which are mostly represented in SSFBs

in Goma town, so that they can develop appropriate strategies that promote the

11



development, growth and maturity of SMEs and FBs. In addition, the findings

enhance understanding of the field of small-scale family businesses for scholars

working in this field.

Scope of the Study

The study focused on small-scale family owned businesses operating in Goma

town in the North-Kivu province. The study targeted SSFBs trading in 2 main

business centers in Goma town namely Katindo and Birere. This study used registered

SSFBs with the Federation of Congolese Enterprises as its population.

Limitations and Delimitations the Study

The researcher anticipated limitation of discretion of the information by study

subjects; sharing business information is a huge risk and a critical action to be done

by an organization therefore divulgating the information to the researcher was a

challenge. However, the researcher dealt with this limitation by approaching the study

subjects and explaining them the benefits of the study; as the research was to help

small-scale family business improve their way of managing their businesses. The

researcher also protected the study subjects through privacy and made sure that the

data of the study subjects did not end up in the hands of the competitors. The

researcher also presented all the necessary documents to prove the purpose of the

study to facilitate the response from the subjects of the study and avoid or minimize

their rejection.

12



Definition of Key Terms

Business Performance: this is the Quantitative and qualitative increase in the

amount of resources owned by a business and the increase in the ability of the

business to attain its goals (Simmons, 2000).

Family Business: Defining the term “family business is widely and exclusively

conditioned by regional location. Family business is a business in which family

involvement in ownership, governance, and management (Chrisman, Chua, Chang &

Kellermanns, 2007)

Strategic Factors: Strategic Factors are features around which organization

managers must focus in order to succeed. They link strategic planning and

performance measurement (Kenny, 2001).

Small Scale Family Business: This is a business with less than fifty employees

with family involvement in ownership, governance, and management (Chua,

Chrisman, & Bergiel, 2009).

13



Chapter Summary

This chapter has provided the background of the study in relation to factors

affecting performance of small scale family businesses. It has presented the

conceptual and contextual discussion of the study in relation to performance of small

scale family business. The chapter has also presented the statement of the problem,

purpose of the study, research questions and objectives, significance of the study

where different stakeholders who will benefit from the study have been outlined. The

chapter has also presented the scope of the study and defines key terms in the study.

14



CHAPTER TWO

LITERATURE REVIEW

Introduction

This chapter covers a theoretical review in which two theories are discussed,

Agency and Resource-based View Theory; the chapter goes on to cover general

literature review under which business performance has been discussed together with

performance indicators divided into two dimension: Business dimension and Family

dimension as discussed first by (Delaney & Huselid, 1996) and lately discussed by

(Núñez-Cacho & Torraleja, 2012). An empirical literature review is also covered in

this chapter under which related studies have been examined in order to inform the

study.

Theoretical Review

A theoretical review is a collection of interrelated concepts linking to the area

of study. Over the years, after realizing the usefulness of family firm in the global

economy, scholars have been trying to establish the influence of existing business

theories to the family business environment and its performance. Many theory have

been found related to Small scale family businesses performance but two of these

theories are particularly relevant to the development of family businesses in

developing economy in this study namely: Agency Theory (Jensen & Meckling, 1976)

and Resource Based Theory (Barney, 1991). Each of these theories approaches family

business performance in a specific perspective, informing the reader on effects of

strategic factors on performance of family businesses.

15



Agency Theory

The agency theory, also known as principal-agent theory is theoretically based

on conflict of interests and opportunistic behavior between an agent, who acts as the

representative of the principal and the principal who delegates work to an agent

(Jensen & Meckling, 1976). This is always associated with agency costs as a result of

conflict in a situation where the two have different interests to protect. Agency theory

suggests that, managers will seek to maximize their own utility at the expense of the

owner of the business. Agents have the ability to operate in their own self-interest

rather than in the best interests of the firm (Ross, 1973). However, agency costs

diminishes when ownership and management unite, because the principal‟s and the

agent‟s interests align. Reduction of agency and monitoring costs occur when an

unselfish behavior is expected. The alignment of Principal and Agent interests

eliminates agency cost therefore affects greatly business performance (Pindado &

Requejo, 2015).

Hence, family-based unselfish behavior guides family managers to focus on

long-term performance, protect the family‟s identity and reputation, and promote non-

economic goals, without expecting any rewards which always determines family

satisfaction toward the business (Chen & John , 2010). Concurrent unselfish behavior

aims to enhance individual and collective growth, because it is concentrated on the

best satisfaction of the firm and family members (Pindado & Requejo, 2015). It is also

a source of competitive advantage, because it eliminates information asymmetries and

promotes communication and creates a sense of belonging to the business (Eddleston,

Kellermanns, & Sarathy, 2008). Furthermore it reduces the development of

relationship conflicts, in family-managed firms when members belong to different

generations or family branches (Eddleston et al. 2008).

16



Regardless of all positive finding about agency theory with the altruistic

behavior an excessive altruistic behavior can lead privileges on employed children

and family priorities to overcome business objectives (Chua, Chrisman, & Bergiel,

2009). In prioritizing family relationships over direct economic profits, family

manager might lose their long-term perspective; by adopt hazardous actions that

endanger firm performance (Siebels & Aufseß, 2012). The family firms might be

affected by the principal–principal agency problem, which arises between majority

and minority shareholders (Villalonga & Amit, 2006). These agency problems will

take different forms in family firms. It appears in second or later generation family

firms, which often face division across separate siblings‟ family units and leads to

intra-family separation of interests and favors self-interested actions that divides

overall family wealth (Bammens, Voorderckers, & Van Gils, 2008).

Resource-Based View Theory

The resource-based view theory (RBV) aims at answering the question of why

some firms perform better than others. It examines the links between a firm‟s internal

characteristics and processes and its performance outcomes (Chrisman, Chua, & Litz,

2004). The value created by different companies depends on how they assemble a set

of valuable, rare, difficult to imitate and substitute resources (Barney, 1991). The

good use of the complementarity of those resources determines the firm performance.

Previous scholars identified the performance of family firms to different, traits such as

a family-oriented industrial atmosphere and collective identity (Welsh and Zellweger,

2010), which enhance employee productivity and information exchanges (Ling and

Kellermanns, 2010). Furthermore, family ties might increase motivation and

commitment to the company‟s vision and long-term objectives (Zellweger &

Astrachan, 2008). Other studies enlighten traits such as community loyalty and

17



respect (Hofman, Hoelscher, and Sorenson, 2006), more flexible decision-making

processes and outstanding reputations (Tagiuri & Davis, 1996).

Most family firms evaluate, acquire, and leverage their resources in ways that

differ from those of non-family firms (Sirmon, Gove, & Hitt, 2008). It is therefore

believed that these differences allow family firms to improve their performances and

to develop a competitive advantage. According to Dyer (2006), three types of

Resources (or assets) defined are involved in a family business and have been

associated with the performance of firms: human resources, social resources, and

physical/financial resources. Family business resources are described as the

“familiness” of a given firm (Habbershon & Williams, 1999). Familiness therefore is

defined as the unique bundle of resources a particular firm has because of the systems

interaction between family, its individual members, and the business

(physical/financial). These interactions create an individual pool of resources and

capabilities. Any of the resources and capabilities that could be associated with a

given firm might influence, either positive or negative. The positive influences are

defined as “distinctive” and hold the potential to provide an advantage; the negative

influences are defined as “constrictive” and hold the potential to constrain

performance (Habbershon & Williams, 1999).

General Literature Review

Strategic Factors

Strategic factors are the most essential features around which organization

managers must focus in order to succeed. They provide not only a route to success but

also a weighting tool that links the way in which strategic planning and business

performance are monitored (Kenny, 2001). Different studies have shown that these

18



strategic factors are found in the organization culture. This culture has a significant

effect on how business operates. Firm culture is particularly positive if it is valuable,

rare, and difficult for other firms to duplicate (Zahra, Hayton, & Salvato, 2004).

Companies culture start with the founders and their vision, values and objectives.

They create a very strong sense of shared purpose, identity, and destiny. The family

culture drives the business.

Shared Vision

A shared vision is central to the long-term growth of any organization

performance. It bonds family member and non-family members together through a

common desired future. An accepted vision is associated with greater affective

organizational commitment among organizational members Dvir, Eden, Avolio, and

Shamir (2002) the nature of an accepted “shared vision” directs the strength and

enhances the performance of the organization in a positive manner. It inspires the

entire organization to success and to grow (Boyatzis & McKee, 2005). Shared vision

in an organization has many positive impacts on the business: it promotes changes,

motivates individuals and improves business performance; it occupies a core role in

the team innovation process (Pearce & Ensley, 2004). Shared Vision not only

strengthens the company, it unites family members, whether or not they are employed

in the business and can reduce unproductive conflict among family members in the

firm (Eddleston & Kellermanns, 2007)

Owner leadership

Most business owners have what is referred to as founders‟ syndrome. This

syndrome arises from the founders‟ unwillingness to share power and authority with

others. The founders become autocratic and paternalistic manager of their

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organizations having all authorities (Muriithi & Wachira, 2016). It is important that

founders include and inspire other stakeholders with employees to be part of decision-

making and other activities. The gap between founders and co-players is eliminated

through approaches that encourage open communication and dialogue. Ultimately this

approach increases teamwork and is favorable to organizational performance.

Owners of family businesses can therefore build a strong culture and

leadership if they are able to multiply their abilities through others. Since the founders

carry the dreams, visions and missions of their organizations, right internal structures

need to be considered to attract talents and competencies that match organizational

needs (Makuwira & Haines, 2014). The Owner must transfer values that reflect his

ideas by delegating their commands to others and let them run the show as he guides

them to the desired objectives. The owner must consider external members as profit to

the organization rather than threats (Muriithi & Wachira, 2016). In this perspective

Owner leadership help construct owners and employees relationship and satisfaction.

Role Clarity and Record Keeping

In Family Businesses environment expectations of the future of the

organizations and role that each party should play must be discussed in an open

dialogue between the founders, employees and other constituents (Muriithi &

Wachira, 2016). Such dialogue will clearly define members‟ authority, power and

responsibilities of different players and specific role required to guide the

organizations to success. Clarification of role may prevent family business to face

internal conflicts hence it promotes employees commitment to the firm enhancing

performance of employees and leading to long-term and overall positive business

performance (Samson & Daft, 2012). It is common for family member employees to

be confused about their roles in the company. Members often play several roles 20



simultaneously such as owner, employee, manager, parent, sibling, child, etc.

(Gersick, Davis, Hampton, & Lansberg, 2007).

In this complex environment, the expectations of these roles may not be clear,

or may even be in conflict (Sundaramurthy & Kreiner, 2008). For some roles, family

harmony may be more important, while for others, return on investment may take

precedence. In the situation of role conflict Memili, Welsh, and Luthans (2013), lack

of clarity in the firm structures business performance may be compromised. Apart

from role clarity small family business to operate successfully, entrepreneur need to

properly manage the business, keep up-to-date records in the business affairs

including meetings, financial documents, and other relevant documents (Ejemobi,

2013). Poor record keeping is always the weakness of many small-scale family

business and stand as a challenge to their success in African countries. The majority

of small business owners in Nigeria for instance do not prioritize record keeping, and

very few that keep records do it professionally (Ejemobi, 2013).

Confidence in External Managers, Appropriate Skills, Employee‟s Training

The introduction of professionals with appropriate skills has been considered

as one of the best strategic factors that influences performance in a family firm

environment (Englisch, Massmann, Specht, Festing, & Harschn, 2016). Enterprises

should develop managerial competences for good performance (Penrose, 2006).

Managerial competences are important because growth involves risk and it depends

on organizational environment with flexibility the presence of external managers

together with appropriate skills play a major role in organization performance (Dobbs

& Hamilton, 2007). Unfortunately external employees and manager find it hard to

adapt within some family business environment. „Hiring and firing‟ practices in the

family business tend to be in the best interest of the family rather than the business 21



(Fishman, 2009). In a family firm, it is always assumed that the company

management must carry all family members along with it. If a small proportion of the

family members are not in agreement with a non-family member, the atmosphere of

tension can arise (Englisch, Massmann, Specht, Festing, & Harschn, 2016). In

everything external managers do, they have to make sure they have the owners on

their side.

According to Adisa et al. (2014) professional qualifications, training, and

acquisition of appropriate skills are very crucial for business performance in a firm

therefore education of family members and appropriate skills brought by external

employees to an organization allows balance and harmony within the organization

and directly affect the general performance of the firm. Muriithi & Wachira (2016),

supported by adding that empowering employees with appropriate skills, experiences

and knowledge enables the founders to delegate responsibilities to others and allow

them to delegate further in the organization because employees are skillful to perform

their tasks therefore they deserve trust in decision making

Business Capital Versus Family Money

Vast majority of small businesses do not have proper accounting system which

is threatening many business performance and survival (Onaolapo, Fasina, Opoola, &

Olatunji, 2011; Olatunji, 2013). The inability to distinguish organization capital from

owner‟s family money is a problem hunting small businesses. Money for the business

and money used in taking care of the family issues should be maintained separately.

This separation helps avoid confusion when dealing with legal payments, holds

accountable for the money that belongs to the business, and helps keep track of

exactly how money is being spent for organizational purposes this helps tracks on the

company financial health.

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Majority of companies have been performing negatively because of this

problem. Many small business owners do not have separate account for their

businesses; they keep only one account for both the business and personal use. This

separation of business capital and Owner‟s family money is considered as one of the

biggest problems confronting small businesses (Ismail & Abdullah, 2012). As the

owner and founder of a family business, the temptation to see all business profits as

personal income is very high, but even if the money is under owner‟s management, it

should not be treated as family funds to maintain complete financial separation

between the business and its owner‟s family money.

Culture and Tradition

Every business is made up by culture and traditions. Many things build up a

family business culture; all of which have their foundation on the assumptions held by

the family business leaders (Dyer, 2006). Culture is perpetuated by the owner-

managers attitudes some who want their family to be involved in the business, some

who put the business first and some who juggled between the two (Birley, 2001).

These assumptions are things like trust, past versus the present and future, how

relationships are formed in the workplace, and more. These assumptions form the

basis for organizational perspectives and values that tie into the family business

culture. Culture is also made up of the perspectives that govern how hiring decisions

are made, how problems are solved, how employees are promoted and the like (Dyer,

2006).

Culture created by assumptions, values and perspectives are manifested in

actual artifacts that employees and outsiders can see as representative of that culture.

Family Businesses are most known for values that they stand for (Elo-Pärssinen &

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Talvitie, 2010). That is, family businesses have implications that involve more than

merely serving a financial purpose; they are means of sharing certain values and

providing a service to the community in which they are integrated (Carlock & Ward,

2010). Family business culture is the linking tie that ties managerial practices with

organizational performance plans.

Business Performance

Business performance is regarded as a reflection of success and particularly as

an indicator of continuity, growth and trans-generational wealth creation over a given

period of time (Craig & Moores, 2006). According to overviews in the performance

literature, a positive business performance does not happen by accident in a firm but it

is a result from internal strategic factors taken within the firm to improve business

performance. Several variables have been used as indicators of performance. Delaney

and Huselid (1996) categorized performance into two areas: organizational

performance and market performance. Organizational performance is based on the

following indicators: the quality of company products and services, the development

of new products, the company‟s potential to attract and retain talent, customer

satisfaction, management-employee relationships, and relationships among

employees. This measure is appropriate for family businesses because it can evaluate

the relationships between employees and management and also between family

employees and non-family employees, including perceptions of fairness. Market

performance is based on the following indicators: sales growth, profitability, and

market share. These variables are suitable for the concept of business performance

implemented by (Hernández & Peña, 2008).

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Performance Indicators

Based on Hernández and Peña (2008) study, supported by Núñez-Cacho and

Torraleja (2012) family business performance have specific indicators to measure its

performance; they noted that we must account for both its company characteristics

and its family characteristics when dealing with family businesses. Therefore, a

performance scale that integrates the duality of these organizations is required

(Delaney & Huselid, 1996). This duality is formed by “business dimension and family

dimension” whereby several indicators are grouped under its related dimension.

Business Dimension

Following Delaney and Huselid (1996), three sets of indicators in the business

dimension are distinctive namely Market presence, Human resource and finance

presence. The first set is grouped under market presence which includes accepted

indicators to measure performance by its dynamic character: market expansion, sales

growth and market share growth. The second set is grouped under human resource

and made by variables related to human resources, which are an important reflection

of an organization‟s success (Delaney & Huselid, 1996). The relationship between

human resources such as the relationships among employees and degree of employee

commitment to the firm are considered as performance indicators. The third set is

grouped under financial indicators, which include annual revenue and profitability

(Núñez-Cacho & Torraleja, 2012). These indicators are used because they are

objective and allow comparing results; they are clear references in family business

research (Hernández & Peña, 2008).

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Family Dimension

The dual nature of family businesses makes it necessary to measure a family‟s

perception of business performance. Frequently, families pay more attention to family

values than to other objective indicators of performance (Chand & Katou, 2007).

Therefore, to measure family business performance, we used a dimension called

“Family”. To evaluate the success of a business, studies have frequently used

satisfaction as an indicator, including the works of (Chand & Katou, 2007). Therefore,

the following indicators compose this dimension: the degree of family satisfaction

with the business, the degree of satisfaction of family employees, and the degree of

satisfaction of the business creator.

Empirical Literature Review

Englisch al. (2016) carried out a study focusing on the recruitment of external

managers in family businesses. They found that the unity between family members

and the relation with the business itself differentiates family businesses from other

non-family businesses. For family members financial stake is not the main point of

interest but the emotional attachment brings a strong need to safeguard the business

for future generations. Family members have a long-term orientation, trust-based

collaboration that is the positive aspects that characterize family businesses (Englisch

al. 2016). When external managers are on board a strong cooperation with family

member is required to avoid unnecessary clashes. External managers are therefore

important for family businesses so that they can overcome the internal and external

challenges that confront them. The presence of external managers enables to ensure

long-term success and the business competitiveness especially as size and complexity

increase.

26



Davila, Foster, and Jia (2010) also find in the same perspective that

performance of a company highly depends on the management. The style needs to

change from a personal management style of the business early-stage into a more

professional style. Putting together strong management infrastructure is associated

with better performance. These systems are adopted proactively when the

management team has the relevant management knowledge.

Figure 2. 1: Ownership and Management Style

Source: (Bloom, Sadun, & Reenen, 2012)

In the above figure Bloom, Sadun, and Reenen (2012) researched on the same

issue and summarized their findings with a classification that shows the average

management quality broken down by various types of ownership. The best run firms

are those that have either private equity or dispersed ownership. Government-run

firms are among the worst run firms as shown in the table. More Family-owned firms

with an outside CEO and managers have a pretty good management score. It is only

when family-owned firms are run by a family member (particularly the eldest son)

that they seem to have very poor performance.

27



Neff (2015) Analyzed the contribution of specific factors that influence

performance of family owned businesses. These included three factors namely

confidence in management, shared Vision and role clarity. According to Muriithi and

Wachira, 2016 in order to guarantee effective performances and efficient service

delivery, employee‟s development should be continuous through different trainings.

The founders need good methods of identifying a pool of professionals and skillful

candidates to recruit. Muriithi and Wachira (2016) Continue stating that the

foundation of such recruitments should be integrity, competencies, experience,

availability and reliability. This recruitment will bring out confidence and trust and

suggests that having qualified external experts lead to achieve the vision within the

organization‟s management team.

Role clarity is viewed by many as a positive attribute and on an individual

level is positively related to job performance (Tubre & Collins, 2000). While greater

role clarity is a common recommendation from family business research and

practitioners Tubre and Collins (2000), Neff (2015) findings suggested that high role

clarity is not universally positive. Given the prominence of the family in the context

of family owned businesses, he anticipated that family functionality would play a

meaningful role in firm culture; however, analysis revealed that family functionality

did not display a direct influence on the business performance, its effect appeared to

be fully covered by: Confidence in Managers, Shared Vision, and Role Clarity.

Family Functionality and intervention had very strong influence on supporting the

three factors cited. The presence and impact of family in the family business is

foundational to the field, without which the business will lose its form.

Dana and Ramadani (2015) In their research on the context and uniqueness of

family businesses found that family businesses have to be prepared to manage

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business and family overlaps, by balancing business requirements and opportunities

with family needs and obligations. The balance between these businesses and family

overlaps can be achieved based on five crucial elements known as strategic factors.

These strategic factors are: setting of clear roles for everyone, separate family and

business capital and, a strong culture brought by the founder of the business with a

clear vision, objectives and strong values in the early development of the firm (Dana

& Ramadani, 2015). Family interferences in the business are the essential problem in

functioning family enterprises. One way to overcome this institutional collision is to

acknowledge the contradictory decisions, arising between family and business

principles is to plan and support training of the family members that work in the

family business in order to equip them with necessary skills.

Cadbury (2000) in his research on family firms identified similar elements that

guide family business success. He found that a clear vision and strong values drive the

result for the business, when the enterprise starts, the family has a single goal to which

all its members can subscribe. Long-term perspective is the sense of building a

business for future generations, which underlies the policies of successful family

firms. In the same study he found that sharing power between family and non-family

members is critical during the growing phase, he noted that this is a hard issue but it

brings good result if well managed. According Cadbury (2000), if family firms are to

manage their performance successfully, they have to adapt their structure to cope with

its objectives by clearly defining Roles. Therefore in case of a failure of any employee

to align personal goals with those of the business, the individual should be questioned

within a professional setting on their position or status in the business.

In Nairobi a study from Murathe (2016) on strategic factors affecting

performance of micro and small-scale family businesses established that the founders‟

29



leadership style affected performance to a great extent. The owner has the overall say

in the matters concerning the business but could at times involve the employees in the

decision making of the organization. It shows that employees are trusted and common

interest for the business is shared. This encouraged creativity and innovation among

the employees. The study also established that majority of the leaders in family

businesses across Nairobi had set clear roles for their employees in attaining

organizational goals and constantly monitored them closely to ensure they performed

their tasks. It was concluded that good governance structures influences family

businesses performance.

Murathe (2016) Continued noting that specialized training for senior managers

is not taken with much attention but agreed that special skills within the organization

were identified and developed. The study finds that family members are assigned

duties that they are not qualified for and family members opposing expert advice from

non-family members. Conflicts of interests, allocation of responsibilities and sharing

of resources are matter of concern in family business management. The study

established that some family members fight to have control of the entire business.

Mugo (2012) stated that education and training of managers are the missing puzzle in

the SMEs environment in Nairobi. To merge business resources effectively depends

on the employee‟s ability and education. Business owner who are educated and have

done some specific training can operate the enterprises effectively and efficiently

(Macharia, 2007).

30



Conceptual Framework

Independent Variables Dependent Variables

Strategic Factors Business Performance

Confidence in external managers

Business capital versus Owner‟s family capital

Appropriate Skills

Employee‟s trainings

Shared vision

Owner leadership

Role Clarity

Record keeping

Business Dimension

Market Presence

Human Resource

Financial Family Dimension

Satisfaction

Culture and tradition

Intervening Variable

Figure 2. 2: Conceptual Framework

Source: (Author, 2019)

31



Chapter Summary

This chapter has provided literature review that reviewed the various strategic

factors affecting performance of SSFBs. The chapter discussed two approaches

commonly used in the study of family businesses namely: Agency and Resource-

based View Theory which are connected to internal factors and business performance;

this chapter also covers general literature review under which business performance

and different performance indicators have been discussed by different scholar,

Perspectives of different scholars and researchers were presented in the empirical

literature review so as to establish what had already been done that was relevant for

the study.

32



CHAPTER THREE

RESEARCH METHODOLOGY

Introduction

As it is indicated in the title, this chapter includes the research methodology of

the study. Research methodology refers to the study of the general approach or

strategy to guide the research. It is simply an organized way to solve the research

problem (Rajaram, 2008). This chapter discusses methods of research and various

processes involved in order to meet research objectives. This includes an outline for

the collection, processing and analysis of data. A comprehensive discussion on the

research design, target population, data collection‟s methods, data analysis, research

limitations and various ethical considerations of the research are outlined. This

research adopted both quantitative and qualitative means of data analysis.

Research Design

Research design consists of the arrangement of data collected and analyzed in

relevance to the research purpose. This study adopted descriptive research; the main

purpose of a descriptive research is description of the situation as it is at present. The

main characteristic of this method is that the researcher has no control over the

variables; he can only report what has happened or what is happening (Kothari &

Garg, 2014). Therefore in the current study the aim was to describe the situation on

the effects of strategic factors on business performance of small-scale family

businesses in Goma/DRC. The researcher gathered information about SSFBs by

collecting data, this helped to describe properly SSFBs situation in order to generalize

the findings to a larger population.

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Population

According to Cooper and Schindler (2008), population is the total collection

of elements with common visible characteristics about which some interpretations can

be made. The population of this research was small-scale businesses with a strict

focus on family owned businesses in Goma town in DRC. This research considered

SMEs holding the characteristics of FBs registered with the FEC Goma. In its 2018,

Annual manual, 70 firms were registered as SMEs holding SSFBs characteristics in

Goma town. The names of these Businesses are attached in the Appendix III.

Target Population

A target population is the specific group to be studied within a population

(Cooper & Schindler, 2008). The population of this study was 70 SSFB‟s in Goma,

The target population for this research was managers of these small-scale family

businesses found in Goma town. Every SSFB was represented by one manager as a

subject of this study.

Census

The study used census to collect data; census is one of the survey methods

relevant for a research and applied in a descriptive research (Kothari & Garg, 2014).

There are two kinds of surveys: sample and census surveys. In a sample survey, data

are collected from only a fraction of units of the population while in a census survey;

data are collected for all units in the population (Kayande, 2009). According to the

FEC 2018 annual report 70 SSFBs were registered at the time of this study hence the

researcher found it reasonable to use census.

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Data Collection Instruments

The researcher collected primary data using questionnaire, this instrument

made the researcher and the respondents to come in contact with each other. It is the

most extensively used method in economic and business surveys (Kothari & Garg,

2014). Questionnaires were given to the respondents with a request to return after

completion. Questionnaires used were prepared very carefully to be effective in

collecting the relevant information. They comprised of closed ended questions in line

with the objectives of the study. According to Brace (2008), in a descriptive research,

Quantitative data is often collected through surveys and questionnaires are carefully

developed and structured to provide numerical data that can be explored statistically

and produce a result that can be generalized to a larger population.

Types of Data

In the research field, two types of data are distinguished: Primary and

secondary data. The research had only considered primary data. Primary data is the

raw data, data that is collected for the first time from respondents, for the purpose of a

research (Sekaran, 2004). On the other hand, secondary data details data that has

already been collected from other sources and referred to by other researches.

Secondary data is much easy to access and cheap to collect compared to primary data

but does not, cover the primary purpose of the research (Kothari & Garg, 2014).

Data Collection Procedures

In terms of data collection, the researcher used a research assistant together

with whom; they oversaw the handing out and collection of questionnaires from the

study subjects. The use of a research assistant helped because of data collection

timeframe and the fact that study subjects were spread geographically across Goma

35



town. To ensure that the research assistants was up to the intended task, the researcher

provided efficient training on the objectives of the research and how data should be

handed out. He also provided all required documents to his assistant to avoid any

rejection from the study subjects when he had handed out the questionnaire and when

reclaiming them back.

Data Analysis Plan

In this study, collected data was analyzed using descriptive statistics. Descriptive

statistical tools helped in describing the data and determining the respondents‟ degree

of agreement with the various statements under each factor. Statistical Package for

Social Sciences (SPSS 22.0.0.0) was the tool used for data analysis. This analytical

tool helped the researcher to interpret and make conclusions on effects of strategic

factors on business performance of small-scale family businesses in Goma town and

to generate descriptive and qualitative reports.

Pre-test of Data Collection Instruments

Before starting the main process of data collection, the researcher conducted a

pre-test of the questionnaire. The pre-test was done in 5 SSFBs in Beni, which is a

neighboring town to Goma. Pre-testing proved to be very useful because it helped

discover probable responses and few relevant weaknesses of questions it therefore

leads to a formulation of more meaningful questions. The researcher clarified the

questions and eliminated gaps that could have interfered with the objectives of the

research (Kothari & Garg, 2014).

Ethical Considerations

This research respected intellectual property by honoring patents, copyrights

and any other forms of intellectual property. The study intended to be open to the

36



world by sharing its results to the academic world as well as the concerned small-

scale family business in Congo and Africa in general. Integrity was also upheld by

making sure that agreement of anonymity and free will was kept with all the subjects

of this study. This research was compliant with all the concerned boards that regulate

researches before it was carried out.

Research Limitations

As it is for every study, this research had the following limitations:

The original language of the study being English while the language used by

the population is French seemed to be a barrier but the researcher translated

the research questionnaire into French.

The fear of the study subjects to release internal information to the research at

first due to fear of government officials, the letter demonstrating the scientific

nature of the study helped the research to overcome this barrier.

Chapter Summary

In this chapter the researcher has discussed the research methodology, which

is a way to systematically answer the research problem. In the process the researcher

in studying the problem adopted various steps. The study was based on a quantitative

research. The quantitative research is done by collecting data through questionnaires

and creating statistics based on the evidence collected to answer the research

questions.

37



CHAPTER FOUR

DATA PRESENTATION, ANALYSIS AND INTERPRETATION

Introduction

This chapter involves the findings, analysis and interpretation of the findings

of this study. This chapter begun by presenting results on background information of

the participants of the study, descriptive findings on each of the strategic factors

affecting performance of SSFB‟s selected for this study, results of indicators of

performance guiding different stakeholders of Small scale family businesses in Goma

town and effects of the selected strategic factors on performance of Small scale family

businesses. The findings were presented using tables and charts.

Presentation, Analysis and Interpretation

This section presents the findings and interpretations to the findings as made

by this study. These include background information of the participants of the study

and study findings established on the research objectives. Descriptive statistics of

frequency, mean, percentages and standard deviation were used. The findings were

presented using Tables and figures.

Response Rate

A total of 70 respondents took part in the research and the study administered

an equivalent number of questionnaires. A total of 63 questionnaires were filled and

returned, this representing 90% response rate. The high response rate was attributable

to two data collection procedures which are direct filling of the questionnaire with the

presence of the researcher or his assistant or drop and pick later to give the

respondents enough time to respond to the questionnaire. Based on the

recommendations of Fishman (2009) that a response rate of above 70% is adequate

38



for descriptive analysis, this study considered the response rate of 90% as sufficient

for the purpose of analysis. Table 4.1 shows the findings on the response rate of the

study.

Table 4. 1: Response Rate

Frequency Percent

Returned 63 90 Not Returned 7 10

Total 70 100.0

Background Information

Background characteristics of the respondents of this study in terms of age,

gender, highest level of education, level of management in the business and length of

working in the business are presented in this section. The section also presents results

of type of business activity that the respondents were involved in and the belonging to

the owner‟s family by the respondent. The study used figures and tables in order to

represent the results.

Age of the Respondents

The study established the age bracket of the respondents of this study and the

results are as presented in Figure 4.1. The purpose of examining the age brackets of

the respondents was to ensure that all age groups were involved in the study to avoid

bias.

39



50

40

30

20 47.6

31.7

10 20.6

0

20-30 31-40 Above 40

Figure 4. 1: Age of the Respondents

Findings of the study as shown in Figure 4.1 indicated that (30)47.6% of the

respondents were aged between 20 and 30 years representing the majority in this case

followed by (20)31.7% who were aged between 31 and 40 and finally (13)20.6%

were above 40 years. The findings indicated that the great majority of the respondents

were millennial aged between 20 and 30 years meaning SSFB‟s workforce in Goma

is made up with young people with minimum responsibility such as family.

Gender of the Respondents

The study also established the gender of the respondents of this study. The

results are as presented in Figure 4.2. The purpose of examining the gender of the

respondents was to ensure gender diversity and representation of all genders in the

research.

40



70

60

50

40

30 61.9

20 39.1

10

0

Male Female

Figure 4. 2: Gender of the Respondents

The findings of the study as shown in Figure 4.2 indicated that (39) 61.9% of

the respondents were male and represented the majority while (24) 39.1% of the study

subjects were female employees. The findings showed that majority of managers in

SSFB are but female employees were also represented and are also occupying

managerial positions in the study.

Highest Education Level of Respondents

The study further examined that highest level of education of the respondents

and the results are as presented in Figure 4.3. This was done to ensure that

respondents of this study had adequate level of education to provide the study with

accurate and reliable information.

41



40

35

30

25

20 36.5

15

30.2

10 19 14.3

5

0

Secondary Diploma Graduate Masters

Figure 4. 3: Highest Education Level of Respondents

The findings of the study as shown in Figure 4.3 indicated that (23) 36.5% of

the study subjects had a Graduate degree, followed by (19) 30.2% of study

participants who had diploma. The results also showed that (12) 19% of the

respondents had completed secondary school while (9) 14.3% had a Master‟s degree.

The findings indicated that majority of the respondents were educated implying they

provided the study with accurate and reliable information.

Level of Management of the Respondents

The study also sought to establish the Level of management of the respondents

who participated in the study and the findings are as presented in Table 4.2. This was

done to ensure that suitable respondents that are well informed about the business

were involved in the study.

Table 4. 2: Level of Management of the Respondents

Frequency Percent Top Management 18 28.6 Middle Management 36 57.1 Low Management 9 14.3 Total 63 100.0

42



The findings of the study as shown in Table 4.2 indicated that (36) 57.1% of

the study subjects were at middle level of management and represented the majority in

this case followed by (18) 28.6% of respondents who were at the top management

level and (9) 14.3% who were at low management level. The findings indicated that

majority of the respondents were at middle management level and therefore

understood the dynamics of the business with regard to strategic factors adopted.

Length of Running the Business

The study further determined the length of operating the small scale family

business by the respondents of the study. The results are as presented in Figure 4.4.

The purpose of this assessment was to determine the duration of existence of the

business and respondents had requisite experience to run the business and understand

its growth patterns.

50 47.6

45 40 35 30 25

19

17.5

20

15.9

15 10

5 0

Less than 1 1-5 Years 6-10 Years More than 10 Year Years

Figure 4. 4: Length of Running the Business

Findings of the study as shown in Figure 4.4 indicated that majority of the

study subjects, (30) 47.6%, had worked in the business for a period of between 1-5

years followed by (12) 19% of the respondents who indicated that they had worked in

the business for less than one year and (11) 17.5% between 6-10 years. A further (10)

43



15.9% of the respondents indicated that they had worked in the business for a period

of more than 10 years. The findings indicated that majority of the respondents had

been long association with the business implying that they had gained enough

experience to steer the business in the right direction.

Organization Main Business Activity

The study finally sought to establish the main activity that the business was

involved in. The results are as presented in Table 4.3. The purpose of this assessment

was to determine the specific type of economic activity that the business was involved

in.

Table 4. 3: Organization Main Business Activity Frequency Percent

Livestock, Agriculture, 13 20.6 Fishing General commerce 16 25.4 Mining 8 12.7 Construction 2 3.2 Transport 7 11.1 Oil and fuel 6 9.5 Telecommunication Industry 3 4.8 Services 8 12.7 Total 63 100.0


respondents revealed that majority of small scale family businesses were involved in

general commerce activities followed by (13) 20.6% who indicated that small scale

family businesses were involved in livestock, agriculture and fishing. A further (7)

11.1% of the participants of the study revealed that small scale family businesses were

involved in transport activities while (8) 12.7% indicated services and (8) 12.7%

44



mining activities. The findings revealed that majority of small scale family businesses

were involved in general commerce activities followed by livestock, agriculture and

fishing activities.

Table 4. 4: Part of Owner’s Family

Frequency Percent

Yes 36 57.1

No 27 42.9

Total 63 100.0


the subjects of the study were members of the family while (27) 42.9% were not

member of the owner‟s family. The findings indicated that majority of the

respondents belonged to the family therefore had a good idea about the business.

Strategic Factors of the Small Scale Family Businesses

The first objective of this study was to identify strategic factors that influence

small-scale family businesses performance. Some of the strategic factors that this

study examined were managerial training, record keeping, and separation of business

capital from owner family money, appropriate skills, and confidence in external

managers, roles clarity and a shared vision. Respondents were asked to rate various

statements on each of these strategic factors that affect business performance of SSFB

based on a scale of 1-5 (1 =No Extent All; 2= Small Extent; 3= Moderate Extent; 4=

Great Extent; 5= Very Great Extent) in order to identify the factors that most affected

growth of SSFB. The results were presented in tables using percentages, means and

standard deviation. To determine presence of shared vision strategic factor considered

as vital for a small scale family business growth, the study used statements of these

variables as shown in the following tables.

45



Table 4. 5: Shared Vision

Frequency Percent No Extent All 3 4.8 Small Extent 8 12.7 Moderate Extent 34 54.0 Great Extent 13 20.6 Very Great Extent 5 7.9 Total 63 100.0

The findings in Table 4.5 assessed whether small scale family businesses used

a shared vision to enhance their performance, the study used a statement which sought

to determine whether the owner has set a clear vision for the firm and shares it with

all employees and the findings showed that majority of the subjects of the study

indicated moderate extent (34) 54.0% and great extent (13) 20.6% with a mean of

3.14 confirming these findings. The findings in this section confirmed that small scale

family businesses used shared vision as a strategic factor to guide business

performance. These findings agreed with Boyatzis and McKee (2005) work who

discussed about resonant leaders he described them as believers, who communicated

well with their employees, and share their vision and feelings about the future of the

firm.

Table 4. 6: Owner’s Leadership Frequency Percent No Extent All 10 15.9 Small Extent 7 11.1 Moderate Extent 25 39.7 Great Extent 16 25.4

Very Great Extent 5 7.9 Total 63 100.0

In order for the study to also assess whether small scale family businesses used owner

leadership to enhance business growth, the study used a statement as shown in table

4.6. The statement sought to determine whether owner leadership style is clear and

46



uses it appropriately to lead the firm, (25) 39.7% agreed to a moderate extent while

(16) 25.4% of the participants of the study indicated great extent with a mean of 2.98

confirming these findings. The findings in this section confirmed that small scale

family businesses relied on owner‟s leadership as a strategic factor to manage the

organization. They supported Muriithi and Wachira (2016) work which found that the

Owners of family businesses must build a strong leadership in managing the business

since they carry the dreams, visions and missions of their organizations.

Role Clarity and Record Keeping

Table 4. 7: Role Clarity


The study sought to assess whether small scale family businesses used role clarity to

enhance business performance. The statement sought to determine whether all

employees have clear roles and attributions and majority of the participants of the

study indicated as highlighted in Table 4.7 small extent, (24) 38.1%, followed by (23)

36.5% of the respondents who indicated moderate extent with a mean of 3.41

confirming these findings. The findings in this sections showed that role clarity was

used at a small extent as a strategic factor. These findings did not support Samson and

Daft (2012) findings which found that using clarification of roles in a family business

prevents internal conflicts hence it promotes employees commitment to the firm

enhancing individual and overall business performance.

47



Table 4. 8: Record Keeping


Table 4.8 sought to show whether information is well recorded and kept while

facilitating its accessibility by everyone within the firm. The findings showing that

(25) 39.7% of the respondents representing majority in this case indicated small

extent followed by (21) 33.3% who indicated moderate extent with a mean of 3.49

confirming these findings. The findings in this section confirmed that the small scale

family businesses used record keeping as a strategic factor. This conclusion support

Ejemobi (2013) findings who found that most African family businesses didn‟t

prioritized on record keeping and very few that keep records do it professionally.

Table 4. 9: Confidence in External Management Frequency Percent

No Extent All 1 1.6 Small Extent 8 12.7 Moderate Extent 32 50.8 Great Extent 16 25.4 Very Great Extent 6 9.5

Total 63 100.0

The study also sought to assess whether small scale family businesses used

confidence in external management to enhance business growth as shown in table 4.9.

The statement sought to determine whether external managers (non-family) receive

maximum confidence and support whereby the findings revealed that majority of the

subjects of the study, (32) 50.8% indicated to a moderate extent, supported by (16)

25.4% of the respondents who indicated great extent with a mean of 3.28 confirming

48



these findings. These findings here supported Englisch et., (2016) work which insisted

that the introduction of professionals‟ managers is one of the best strategic factors that

influences performance in a family firm environment.

Appropriate Skills and Employees Trainings

Table 4. 10: Appropriate Skills

Frequency Percent


Total 63 100.0

In order for the study to assess whether small scale family businesses used

appropriate set of skills to enhance business performance, the study used a statement

which sought to determine whether the business has qualified staff and appropriate

skills as shown in Table 4.10. The majority of the subjects of this study indicated

moderate extent (14) 34.9% and great extent (20) 31.7% with a mean of 3.06

confirming the findings. They therefore confirmed that small scale family businesses

used appropriate skills as a strategic factor to improve their performance. The above

findings agreed with Adisa et al. (2014) who found that professional qualifications

and appropriate skills are very crucial for business performance in a firm, appropriate

skills brought by external employees to an organization affect the general

performance of the firm.

Table 4. 11: Employee’s Trainings

Frequency Percent No Extent All 19 30.2 Small Extent 19 30.2 Moderate Extent 18 28.5 Great Extent 4 6.3 Very Great Extent 3 4.8

Total 63 100.0

49



Table 4.11 demonstrated whether employee skills are developed through different

trainings whereby the findings showed that (19) 30.2% No extent at all and another

(19) 30.2% agreed at small extent with a mean of 2.95 confirming these findings.

They therefore showed that small scale family businesses didn‟t used employee‟s

trainings as a strategic factor to improve their performance. These findings are in

contrast with Muriithi and Wachira (2016) who found that empowering employees

with appropriate skills, experiences and knowledge enables the founders to delegate

responsibilities to others and therefore increase business performance.

Table 4. 12: Business Money VS Owners Money


The study wanted to find out whether business money was used solely for

business purposes and the owner has no right to use it for any personal or family

reasons. Table 4.12 showed that (20) 31.7% indicated no extent at all and another (14)

22.2% indicated at a moderate extent with a mean of 2.49 confirming these findings.

They therefore showed that small scale family businesses owners used business

money for their personal and family purposes therefore failed to use Capital

separation as a strategic factor to improve their business performance. These findings,

above supported Onaolapo, Fasina, Opoola, and Olatunji (2011); Olatunji (2013)

works, they found that the majority of small family businesses do not have proper

accounting system and are unable to distinguish organization capital from owner‟s

family money. Money for the business and money used in taking care of the family

issues are used interchangeably.

50



Table 4. 13: Culture and Traditions


The study wanted to find out if business processes are based and guided by

firm culture and traditions. The findings showed in Table 4.13 that (21) 33.3%

indicated moderate extent and another (15) 23.8% indicated at a great extent with a

mean of 2.92 confirming these results. The findings therefore showed that many small

scale family businesses were based on culture and traditions which played an

important role in business processes and management. The findings in this section

showed that the current study agrees with Dyer (2006) work who found that business

culture help govern businesses and guide management processes.

Table 4. 14: Mean and Std. Deviation values for Strategic Factors

F1 F2 F3 F4 F5 F6 F7 F8 F9

N Valid 63 63 63 63 63 63 63 63 63

Missing 0 0 0 0 0 0 0 0 0 Mean 3.4127 2.9841 3.1429 3.2857 3.4921 3.0635 2.9524 2.4921 2.9206

Std. .91329 1.1569 .94417 .86934 .93106 .99795 1.0227 1.3182 1.1402 Deviation

Table 4.14 shows different means and std. Deviation values for different strategic

factors assessed in this study. The strategic factor with the highest Mean value of

3.492 was “Confidence in External managers” the SD of the same was 0.931,

followed by shared vision between the Owner and all employees with a mean of 3.412

with a SD of 0.913.

51



Performance Indicator Used to assess SSFB‟s Performance

The second objective of this study was to find out how small scale family businesses

were performing. The indicators used and examined are classified into two: Business

dimension and family dimension. Respondents were asked to rate various statements

on each of these performance indicators of SSFB based on a scale of 1-5 (1 =No

Extent All; 2= Small Extent; 3= Moderate Extent; 4= Great Extent; 5= Very Great

Extent). The results were presented in tables using percentages, means and standard

deviation. The study used statements of these indicators variables.

A. Business Dimension

Market Presence

Table 4. 15: Sales

Frequency Percent No Extent All 3 4.8 Small Extent 8 12.7 Moderate Extent 34 54.0

Great Extent 15 23.8 Very Great Extent 3 4.8

Total 63 100.0

In order for the study to assess small scale family businesses performance

status the study sought to know whether business sales had grown during the previous

year. The findings in Table 4.15 showed that majority of the respondents indicated

moderate extent (34) 54.0% and great extent (15) 23.8% with a mean of 3.11

confirming these results. These findings mean that SSFB‟s performance is positive.

The findings in this section followed Núñez-Cacho and Torraleja (2012) and

Hernández and Peña (2008) respective works which provides a scale for measuring

52



family business performance and has confirmed its reliability and validity in sample

family businesses.

Table 4. 16: Market Share


On whether to know if the firm had increased its market share from previous

year range Table 4.16 showed that majority of the subjects of the study indicated

moderate extent, (30) 47.6% and great extent, (20) 31.7% with a mean of 3.23

confirming these findings. These findings showed that many SSFB‟s are performing

well with their market share increasing. The findings in this section followed Núñez-

Cacho and Torraleja (2012) and Hernández and Peña (2008) respective works which

provides a scale for measuring family business performance and has confirmed its

reliability and validity in sample family businesses.

Table 4. 17: New Market

Frequency Percent


Total 63 100.0

Finally in assessing the businesses market presence the study sought to

identify whether the firms had invested in new market. The findings in Table 4.17

showed that majority of the participants of the study indicated no extent at all (33.3%)

and small extent (27.0%) with a mean of 2.66 confirming these results. The findings

53



in this section indicated that small scale family businesses didn‟t invest in new

market. These findings didn‟t follow Núñez-Cacho and Torraleja (2012) and

Hernández and Peña (2008) respective works which provides new market as a scale

for measuring family business performance and has confirmed its reliability and

validity in family businesses firms.

Human Resource

Table 4. 18: Employee’s Relationship Frequency Percent


Total 63 100.0

In order for the study to assess whether small scale family businesses

performance was good the study sought to know the state of the relationship between

employees in the firm. The findings in Table 4.18 showed that majority of the

respondents indicated moderate extent, (30) 47.6% and great extent (24) 38.1% with a

mean of 3.26 confirming these results. Meaning that SSFB‟s the relationship between

employees had been good implying workspace is viable and that the business

performance is generally healthy. The findings in this section followed Núñez-Cacho

and Torraleja (2012) and Hernández and Peña (2008) respective works which

provides employee‟s relationship status as a scale for measuring family business

performance and has confirmed its reliability and validity in a family businesses firm.

54



Table 4. 19: Employee’s Commitment


In the quest to assess whether small scale family businesses performance was

noble the study sought to know the degree of commitment of employee to the firm.

Table 4.19 showed that majority of the respondents indicated moderate extent, (30)

47.6% and great extent (23) 36.5% with a mean of 3.22 confirming these results.

Meaning employees commitment to SSFB‟s had been good implying that employees

are satisfied to work in the environment which suggests that the business is

performing well. The findings in this section followed Núñez-Cacho and Torraleja

(2012) and Hernández and Peña (2008) respective works which provides employee‟s

commitment status as a scale for measuring family business performance and has

confirmed its reliability and validity in a family businesses firm.

Financial

Table 4. 20: Annual Revenue

Frequency Percent

Small Extent 10 15.9 Moderate Extent 31 49.2 Great Extent 18 28.6 Very Great Extent 4 6.3

Total 63 100.0


decent the study sought to know if SSFB‟s annual revenue increased from the

previous year. Table 4.20 shows that majority of the respondents indicated moderate

extent, (31) 49.2% and great extent (18) 28.6% with a mean of 3.25 confirming these

results. This means that SSFB‟s had been performing good implying that annual

55



revenue had increased from previous according to the study subjects. The findings in

this section followed Núñez-Cacho and Torraleja (2012) and Hernández and Peña

(2008) respective works which used annual revenue status as a scale for measuring

family business performance and has confirmed its reliability and validity in a family

businesses firm.

Table 4. 21: Firm Profitability

Frequency Percent Small Extent 9 14.3 Moderate Extent 32 50.8 Great Extent 21 33.3 Very Great Extent 1 1.6 Total 63 100.0


good the study tried to find if SSFB‟s profitability had improved than the previous.

The findings shown in Table 4.21 showed that majority of the respondents indicated

moderate extent (32) 50.8%, great extent (21) 33.3% with a mean of 3.22 confirming

these results. This means that SSFB‟s had been performing well following that the

majority of the respondents indicated that firm‟s annual profits had improved. The

findings in this section followed Núñez-Cacho and Torraleja (2012) and Hernández

and Peña (2008) respective works which used firm profitability status as a scale for

measuring family business performance and has confirmed its reliability and validity

in a family businesses firm.

56



B. Family Dimension

Satisfaction

Table 4. 22: Family Satisfaction


In the quest on assessing whether small scale family businesses performance

was good the study tried to find the degree of satisfaction of family members involved

in the businesses to find if the business performance was bringing satisfaction in the

family. Table 4.22 showed that majority of the respondents indicated moderate extent,

(25) 39.7% and great extent (22) 34.9% with a mean of 3.07 confirming these

findings. This means that SSFB‟s performance had been satisfying family members

involved in the business. The findings in this section followed Núñez-Cacho and

Torraleja (2012) with Hernández and Peña (2008) respective works which used

family satisfaction to measure family business performance and has confirmed its

reliability and validity in a family businesses firm.

Table 4. 23: Owner’s Satisfaction


Total 63 100.0

The Owner of the business being the main stakeholder, the study tried

therefore to find the degree of his satisfaction about his business performance. The

study asked the respondents whether the owners of the family business satisfied by

57



the business performance. The findings presented in Table 4.23 showed that majority

of the respondents indicated great extent, 41.3% and moderate extent 30.2% with a

mean of 3.31 confirming these results. This means that owners of SSFB‟s had been

satisfied by the performance his business. The findings in this section followed

Núñez-Cacho and Torraleja (2012) and Hernández and Peña (2008) respective works

which used Owner‟s satisfaction to measure family business performance and has

confirmed its reliability and validity in a family businesses firm.

Table 4. 24: Mean and Std. Dev values for Performance Indicators 11 I2 I3 I4 I5 I6 I7 I8 I9 N Valid 63 63 63 63 63 63 63 63 63 Missing 0 0 0 0 0 0 0 0 0 Mean 3.1111 3.2381 2.6667 3.2698 3.2222 3.2540 3.2222 3.0794 3.3175 Std. Dev .86343 .81744 1.21814 .86521 .90597 .80258 .70584 .92111 .99718

Table 4.24 shows different means and std. Deviation values for different performance

indicators assessed in this study. The indicator with the highest Mean value of 3.3175

was “Owner satisfaction on the business performance” the SD of the same was 0.997,

followed by “Market share” with a mean of 3.238 with the SD of 0.817.

Effect of Strategic Factors on Business Performance

The third and final objective of this study was to investigate the extent to which every

strategic factor identified affected performance of small scale family businesses. The

statements framed for the study to establish the effects are specifically adapted for

every Strategic factor on business performance. Business performance in this case

refers to both dimension meaning business and family dimension. Respondents were

asked to rate the statements based on the scale of this study. The findings are as

shown in different Table for each factor.

58



Table 4. 25: Shared Vision on Business Performance


Total 63 100.0

In order to investigate at what extent a shared vision affected performance of small

scale family businesses, the study used a statement which sought to know if a shared

vision between the Owner and all employees has played a major role in business

performance. The findings in Table 4.25 showed that majority of the subjects of the

study indicated moderate extent (30) 47.6% and great extent (16) 25.4% with a mean

of 3.11 confirming that a shared vision in SSFBs had an impact on business

performance. The findings in this section confirmed that small scale family businesses

using a shared vision as a strategic factor are having a relatively positive business

performance. The findings agreed with Boyatzis and McKee (2005) work which

found that businesses where leaders communicated well with their employees, and

shared their vision and feelings about the business with employees had a positive

business performance.

Table 4. 26: Owners Leadership on Business Performance

Frequency Percent


Total 63 100.0

In order to investigate at what extent Owners leadership affected performance of

small scale family businesses, the study sought to know if Owners leadership has been

59



crucial in increasing business performance. The findings in Table 4.26 showed that

majority of the subjects of the study indicated moderate extent (22) 34.9% followed

by great extent (18) 28.6% with a mean of 2.90 confirming that owners leadership in

SSFBs had an impact on business performance. The findings in this section confirmed

that Owners with a clear leadership style influenced the performance of small scale

family businesses using his leadership as a strategic factor to manager the firm. These

findings supported Muriithi and Wachira (2016) work which found that the Owners of

family businesses with a strong leadership in managing the business affected the

performance of the business.

Table 4. 27: Roles Clarity and Records Keeping On Business Performance


Total 63 100.0

In the quest to assess at what extent roles clarity and records keeping affected

performance of small scale family businesses, the study sought to know if roles

clarification and records keeping has been pillars in improving business performance.

The findings in Table 4.27 showed that majority of the subjects of the study indicated

small extent (25) 39.7%) followed by moderate extent (22) 34.9 % with a mean of

3.25 showing that roles clarity and records keeping in SSFBs didn‟t have an impact

on business performance. The findings in this section confirmed that roles clarity and

records keeping didn‟t influence the performance of small scale family businesses.

These findings didn‟t support Samson and Daft (2012) findings which stated

that clarification of roles in a family business promotes employees commitment to the

60



firm enhancing individual and overall business performance while supporting

Ejemobi (2013) findings which found that African family businesses didn‟t prioritized

on record keeping and very few that keep records do it professionally.

Table 4. 28: Confidence in External Managers on Business Performance

Frequency Percent

Small Extent 7 11.1 Moderate Extent 32 50.8 Great Extent 20 31.7 Very Great Extent 4 6.3 Total 63 100.0

In the quest to assess at what extent Confidence in External managers affected

performance of small scale family businesses, the study sought to know if Confidence

in External managers brought a good business performance balance. The findings in

Table 4.28 showed that majority of the subjects of the study indicated moderate extent

(32) 50.8% followed by great extent (20) 31.7% with a mean of 3.33 confirming these

results by showing that Confidence in External managers in SSFBs had moderate

influence on business performance. The findings in this section indicated that

Confidence in External manager was used by SSFBs for their performance and had

affected many SSFBs performances when used as a strategic factor within a firm. The

findings here supported Englisch et al. (2016) work which insisted that the

introduction of professional‟s managers is one of the best strategic factors that

influence performance in a family firm environment.

Table 4. 29: Employees Trainings on Business Performance


Total 63 100.0

61



In the quest to evaluate at what extent appropriate skills and employees trainings

affected performance of small scale family businesses, the study sought to know

whether appropriate skills in the firm and employees trainings is associated to positive

business performance. The findings in Table 4.29 showed that majority of the subjects

of the study indicated great extent (20) 31.7% followed by moderate extent (20)

31.7% with a mean of 3.03 confirming these results, meaning that appropriate skills

and employees trainings in SSFBs had an adequate influence on business

performance. The above findings agreed with Adisa et al. (2014) who found that

professional qualifications and appropriate skills had an effect on business

performance in a firm but also empowering employees with appropriate skills,

experiences and knowledge enables the founders to delegate responsibilities to others

and therefore increase business performance as discussed by (Muriithi & Wachira ,

2016).

Table 4. 30: Business Capital and Owner’s Money Separation Frequency Percent No Extent All 15 23.8 Small Extent 16 25.4 Moderate Extent 14 22.2 Great Extent 13 20.6

Very Great Extent 5 7.9 Total 63 100.0

In the quest to evaluate at what extent business money and owner‟s money

separation affected performance of small scale family businesses, the study sought to

know whether business money and owner‟s money separation have been major in


of the study indicated small extent (16) 25.4% followed by no extent at all (15) 23.8%

with a mean of 2.69 confirming these results meaning that business money and

62



owner‟s money separation in SSFBs had an small influence on business performance.

The findings in this section indicated that business money and owner‟s money

separation was not considered as major by SSFBs for their performance and had not

stopped many SSFBs to positively perform at some extent therefore it is not

considered as a crucial strategic factor in SSFBs. These findings supported Onaolapo

et al., (2011); Olatunji (2013) works, which stated that the majority of small family

businesses are unable to distinguish organization capital from owner‟s family money.

Table 4. 31: Culture and Traditions on Business Performance


In the quest to evaluate at what extent organization Culture and Traditions

affected performance of small scale family businesses, the study wanted to know

whether Culture and traditions guides business processes hence helps in improving


of the study indicated small extent (18) 28.6% followed by moderate extent (17)

27..0% but also a significant number indicated no extent at all (14) 22.2% with a mean

of 3.00 confirming these findings meaning that Culture and Traditions in SSFBs

didn‟t have an important impact on business performance for SSFBs. The findings in

this section shows that the current study did not agreed with Dyer (2006) work which

found that business culture help govern businesses and guide management processes

which affect performance of businesses.

63



Table 4. 32: Mean and Std. Dev for Factors Effects on Performance

E1 E2 E3 E4 E5 E6 E7

Valid 63 63 63 63 63 63 63

Missing 0 0 0 0 0 0 0 Mean 3.2540 2.9048 3.1111 3.3333 3.0317 2.6984 3.0000

Std. Deviation .95227 1.21435 .91525 .76200 .98322 1.27804 1.19137

Table 4.32 shows different means and std. Deviation values for different

performance indicators assessed in this study. The factor with the highest Mean value

of 3.3333 was “Confidence in External managers” the SD of the same was 0.762,

followed by shared vision between the Owner and all employees with a mean of

3.2540 with the SD of 0.95.

Reliability Test

This section presents the findings different analysis between strategic factors

and performance of small scale family businesses in DR Congo the case of Goma

Town. The findings presented show the model summary, ANOVA and reliability

statistics.

Table 4. 33: Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate 1 .740

a .547 .470 .62842

a. Predictors: (Constant), F9, F6, F4, F5, F7, F3, F2, F8, F1

The model summary findings in Table 4.33 showed that the model had an R-

square of 0.547 which implied that 54.7% of the variation of performance of small

scale family businesses in DR Congo the case of Goma Town was accounted for by

the use of strategic factors which include ownership leadership, role clarity, shared

vision and other strategic factors discussed in the study.

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Table 4. 34: ANOVA Results Source Sum of Squares Df Mean Square F Sig. Regression 37.162 35 1.062 3.164 .001 Residual 9.060 27 .336 Total 46.222 62 a. Dependent Variable: Performance of SSFBs b. Predictors: (Intercept), F1, F2, F3, F4, F5, F6, F7, F8, F9

The findings of ANOVA presented in Table 4.34 shows f-statistics = 3.164

and p=0.001. These findings implied that the regression model use to link the external

management, appropriate skills and employee‟s training, ownership leadership, role

clarity, shared vision, and performance of small scale family businesses in DR Congo

had a goodness of fit. The findings similarly showed strategic factors significant

influence performance of small scale family businesses in DR Congo.

Table 4. 35: Reliability Test

Cronbach's Alpha Cronbach's Alpha Based on N of Items Standardized Items .944 .948 32

A reliability coefficient of 0.70 or higher is considered “acceptable”. The

alpha coefficient for the study is 0.944, as shown in Table 4.35; therefore the current

research had a high internal consistency.

Summary of Key Findings

The first objective of this study was to identify strategic factors that influence small-

scale family businesses performance.

1. The findings of the study confirmed that (47) 74.6% of small scale family

businesses used shared vision at moderate and great extent as a strategic factor

to improve performance.

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2. The findings confirmed that (41) 65.1% of small scale family businesses used

owner leadership at moderate and great extent as a strategic factor to improve

their performance.

3. The findings indicated that (48) 76.2% of small scale family businesses used

confidence in external management at moderate and great extent as a strategic

factor to improve their performance.

4. The findings indicated that (42) 66.6% of small scale family businesses used

appropriate skills at moderate and great extent as a strategic factor to enhance

performance.


were measuring performance. The indicators used and examined were classified into

two: Business dimension and family dimension.

5. The study used business and family dimension indicators to measure SSFBs

performance the findings show respectively that (49) 77.8%, (50) 79.3%, (49)

77.8%, (53) 84.1% of respondents agreed at moderate and great extent that

sales, market growth, annual revenue and profitability had grown during the

previous year while (38) 60.3% of the study subjects investing at a small

extent and no extent at all in new market. The findings continued by assessing

the degree of commitment by employee and the relationship between

employees and it had been find respectively that (53) 84.1% and (54) 85.7% of

the study subject agree at moderate and great extent that the workspace is

viable implying that business performance was healthy. Finally the study

found that (47) 74.6%, (45) 71.5% of study subjects responded respectively

that family members and owner of the business were satisfied at a moderate

extent and great extent by their business performance.

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The third and final objective of this study was to investigate the extent to which

strategic factors affect performance of small-scale family businesses.

6. The findings in this section confirmed that owners with a clear leadership style

(40) 63.5%, confidence in external manager (52) 82.5%, shared vision (46)

73%, appropriate skills and employees trainings (40) 63.4% influenced at

moderate and great extent performance of small scale family businesses when

used as strategic factor by family firm. The findings further showed (47)

74.6% of the study subject indicated that roles clarity and records keeping

affected at small and moderate extent the performance of small scale family

businesses.

7. The findings showed (32) 50.8 % and (31) 49.2% respectively of the study

subjects indicated that Culture and traditions with business money and

owner‟s money separation affected business performance at small or no extent

at all. This findings means that firm culture and tradition with business money

and owner‟s money separation did not have a significant impact on business

performance for SSFBs in Goma.

Chapter Summary

This chapter entailed the presentations of the findings, analysis and

interpretation of the findings. The chapter presented findings on background

information of the respondents, results on strategic factors identified that are adopted

by small scale family businesses in Goma town, performance indicators used by

businesses and effect of the identified strategic factors on performance of small scale

family businesses. The findings were presented using Tables and charts.

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CHAPER FIVE

DISCUSSIONS, CONCLUSIONS AND RECOMMENDATIONS

Introduction

The areas that are presented in this chapter include discussions of the key

findings based on each of the three objectives of the study, conclusions,

recommendations made by the study and suggestions of areas for further research. In

the discussion of the findings, the study compares the finding of this study and those

of other scholars analysed in the empirical review section. Conclusions were also

based on the findings of the study on each of the specific objectives of the study.

Recommendations were then made based on the conclusions to guide policy

formulation.

Discussions

The objectives of the study were: to identify strategic factors that influence

small-scale family businesses performance, to find out how small scale family

businesses were performing and to investigate the extent to which strategic factors

affect performance of small-scale family businesses. This section therefore presents

the findings based on the specific objectives and discussion of the same based on the

empirical literature.

Strategic Factors that Influence Small Scale Family Businesses

The first objective of this study was to identify whether small scale family

businesses used some strategic factors to guide their performance. Strategic factors

that this study examined were confidence in external management, business capital

and owner‟s money separation, appropriate skills and employee‟s trainings, shared

vision, owner leadership and role clarity and record keeping. The findings confirmed

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that small scale family businesses use shared vision this result is supported by Tubre

and Collins (2000) and with Boyatzis and McKee (2005) who suggested that a shared

vision had a positive trait for business performance and it is related to a positive job

performance. The results further indicated that small scale family businesses had

adopted confidence in external management as a strategic factor to improve their

performance, this findings of the study agree with Davila et al. (2010) and Englisch et

al. (2016) who suggested that bringing on board non-family managers is important for

the business to overcome both internal and external challenges that confront them and

the introduction of professionals managers is one of the best strategic factors that

influences performance in a family firm environment.

The results finally indicated that small scale family businesses used

appropriate skills and owner leadership as a strategic factor to improve performance,

these supports Muriithi and Wachira (2016) work which identified that the owner of

the business needs some methods of identifying appropriate skills when recruiting.

Nevertheless the findings show that the businesses relied at a small extent on

employee‟s trainings to improve performance although Muriithi and Wachira (2016)

suggested that in order to guarantee effective performances and efficient service

delivery, building capacity of workers should be continuous. The finding continued by

showing that Business capital and owner‟s money was separated at a small extent

meaning the owner could use business money for his personal and family needs did

not prevent business to perform. These findings did not agreed with Dana and

Ramadani (2015) who found that family businesses have to manage business and

family overlaps, by balancing business requirements and opportunities with family

needs. These findings confirmed Onaolapo et al. 2011); Olatunji (2013) works, which

found that the majority of small family businesses do not have proper accounting

69



system and were unable to distinguish organization capital from owner‟s family

money.

Business Performance Measurement used by Small Scale Family Businesses


were measuring their performance. The indicators used and examined were classified

into two: Business dimension and family dimension. Every dimension had specific

indicators which were used to assess performance. These indicators were Market

presence, human resource, financial and satisfactions. Following Delaney and Huselid

(1996) work which identified that Market presence will help to notice a well

performing firm.

Research findings indicated that SSFBs Sales, Market share was increasing

moderately from previous years while SSFBs were penetrating new market at a small

extent, these findings helped therefore the researcher to evaluate SSFBs performance

status in Goma. The findings also showed that Employee‟s relationship and

Employee‟s commitment are indicators to measure SSFBs performance. Employee‟s

relationship and Employee‟s commitment hence was moderately good meaning that

employees were satisfied by the treatment received from SSFBs which translated that

SSFBs performance was good, following Delaney and Huselid (1996) work the

relationships among employees and degree of employee commitment to the firm will

differentiate a business which is performing well to another which is not performing

well. These findings therefore had helped the researcher to assess performance

position in the current study.

The findings in this study continued by showing that firm Annual Revenue

and Firm Profitability was increasing moderately as shown in this study findings.

70



According to Núñez-Cacho and Torraleja, (2012) Annual Revenue and Firm

Profitability will show how a given business is performing, these indicators are

objectives of the current study and allow comparing results; they are clear references

in family business research thus the study followed Hernández and Peña (2008) work

to help evaluate SSFBs performance.

Finally the current study showed that family member‟s satisfactions, together

with the owner‟s satisfaction on business can be used as indicators to measure SSFBs

performance. In this study family members and business owner were satisfied with

the business performance at a great extent. To evaluate the success of a business,

studies have frequently used satisfaction as an indicator, including the works of

(Chand & Katou, 2007). The study agreed with these different works and used

satisfaction as an indicator because the degree of satisfaction among family member

will determine whether the business is performing well therefore answering the

business purposes. The results helped to have a clear idea on SSFBs performance

status in Goma with business owner‟s perception.

Extent of to which Strategic Factors affect Small scale Family Businesses

Performance

The third objective of this study was to investigate the extent to which

strategic factors identified affect performance of small scale family businesses. The

findings indicated that the identified strategic factors affected differently small scale

family businesses performance. The results showed that showed that Culture and

traditions together with the lack of record keeping and roles clarity were selected at a

small and moderate extent, while appropriate skills and other factors affected

performance at moderate and great extent. The results showed that all these factors

were selected at a certain extent on their effects on performance.

71



The results of the study agree with Kenny (2001) that strategic factors are the

most essential features around which SSFBs organization managers must focus in

order to succeed because not only do they provide a route to success but also a

weighting tool that links the way in which performance is monitored. The results are

also in agreement with the argument by Pearce and Ensley (2004) that having a

shared vision not only strengthens the company but also unites family members

together with non-family employees and can reduce unproductive conflict in the firm.

The results are also consistent with Ejemobi (2013) who posited that for

small-scale family business to operate successfully there is need to involve external

managers who may help settle family conflicts, and also hire employees who have

appropriate skills for different position. According to Ejemobi (2013), the

introduction of appropriate skills is considered as one of the best strategic factors to

improve performance of a family firm.

The results also agree with Englisch et al. (2016) that Business owner‟s

experience and leadership abilities are very crucial for a good performance for every

business therefore education and appropriate skills brought by external employees to

an organization allows balance and harmony within the organization and directly

affect positively performance of the firm.

Conclusion

Based on the findings, the study concluded that small scale family businesses

operating in Goma town adopted strategic factors such as external management,

appropriate skills, shared vision and owner‟s leadership to improve their performances.

Nevertheless many SSFBs did not separate business capital with owner‟s money also

they did not focus on role clarification and employee‟s training to

72



improve performance. The study found that culture helped to shape business

performance positively and guided internal management and business processes. The

study used business and family dimension as performance indicators to measure

performance which helped to identify SSFBs performance status. The results showed

that these adopted strategic factors had adequate influence and affected SSFBs

performances.

Recommendations

This study made several recommendations that can be effective for not just

small scale family businesses in Goma town but also other organisation seeking to

improve their performance.

i. The study recommends that for small scale family businesses to enhance

its performance, introducing external managers (Non-Family) with

appropriate skills is required. The introduction of professionals with

appropriate skills improves performance especially in a family firm

environment.

ii. The study also recommends that for small scale family businesses to

enhance performance, the owners of SSFBs need to share their vision with

employees because a shared vision not only strengthens the company but

unites family members and non-family employees.

iii. The study finally recommends that SSFBs need to use Owner‟s leadership

qualities to enhance performance because a good leader brings balance and

harmony within the business.

73



Areas for Further Research

The focus of the study was on effects of strategic factors on performance of

selected small scale family businesses in Goma town. The specific strategic factors

that were examined include confidence in external management, separation of

business capital and owner‟s money, appropriate skills and employee‟s trainings,

shared vision, owner leadership, organization culture and tradition, role clarity and

records keeping. However, these are not the only strategic factors that affect

performance. Further studies should therefore focus on other factors that affect

performance of small scale family business other than the ones identified and

examined by this study such as government regulation and other external factors. This

will help bridge the conceptual knowledge gaps.

The study further recommends that similar studies should be carried out using

different methodologies such as correlation analysis to test the strength of the

relationship between strategic factors and performance of small scale family

businesses. Similarly, further research can focus on the effect of strategic factors on

the growth of other organisations other small scale family businesses and be

conducted outside Goma town in order to fill the existing contextual gaps.

74



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APPENDICES

Appendix I: Questionnaire

QUESTIONNAIRE

My name is Alain Birindwa Ndagano, a student at Daystar University currently pursuing a Master‟s in Business Administration in Strategic Management. I am undertaking a research on effects of selected strategic factors on the growth of small-scale family businesses in DR Congo the case of Goma Town.

By the attributes of being part of Small-scale family businesses, you qualify as

a respondent for this research. Please accept my invitation to participate in this research by sparing some time to fill this questionnaire. It is being administered for research purposes and any information provided will be used purely for academic purposes and will be treated with strict confidentiality. Please read the questions carefully and feel free to respond to them by giving your response by ticking [√] whichever option best describes you or applies to you or your company.

SECTION A: GENERAL INFORMATION

(a) Please state your age:

20 years - 30 Years [ ]

31 years – 40 years [ ]

Above 40 years [ ]

(b) Please specify your gender: Male

[

]

Female

[

]

(c) What is your highest education level?

Secondary level [

]

Diploma level [

]

Graduate level [

]

Post-graduate level [

]

(d) What is your level of Management in the company?

Top Management [ ]

Middle Management [

]

Low Management [

]

(e) For how long have you been working in this company {Tick as

appropriate} Less than 1 year [ ]

1 years - 5 years [ ]

6 years - 10 years [ ]

More than 10 years [ ]

(f) What is the organization main business activity {Please fill the empty space below}

Livestock, Agriculture and Fishing[ ] General commerce[ ]Mining [ ]

Construction[ ] Transport[ ] Oil and fuel[ ] Telecommunication[ ] Industry[ ]

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Services [ ]

(g) Are you a close family member of the Owner of the business? Yes [ ] or No [ ]

SECTION B: SELECTED STRATEGIC FACTORS

This section seeks to determine those selected strategic factors used by small-scale family business for growth.

The statements below relate to the effects of those strategic factors considered as vital for a small-scale family business performance. Kindly rate the statements on the scale given below.

KEY: 1 =No Extent All; 2= Small Extent; 3= Moderate Extent; 4= Great Extent; 5= Very Great Extent

1. Shared vision 1 2 3 4 5

F1 The owner has set a clear vision which is shared with all employees.

2. Owner leadership

F2 The owner leadership style is clear and uses it appropriately to lead the firm

3. Roles clarity

F3 All employees have clear roles and attributions

4. Record keeping

F4 Relevant business documents and records are well kept and can be accessible when needed by authorized persons

5. Confidence in external managers

F5 All non-family managers receive maximum confidence and support

6. Appropriate skills

F6 Appropriate skills sets are used for different business positions

7. Employees trainings

F7 Employees skills are developed through different trainings

8. Business money VS Owners money

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F8 Business money is used solely for business purposes and the

owner has no right to use it for any personal or family reasons

9. Culture and traditions

F9 Business processes are based and guided by firm culture and traditions

SECTION C: PERFORMANCE INDICATORS

This section seeks to determine indicator used to measure family business performance.

C. Business Dimension

The statements below relate to business dimension as performance indicators. Kindly rate the statements on the scale given below.


Statement 1 2 3 4 5

1. Market presence

I1 Our business sales has gone up last year

I2 Our market share has increased last year

I3 Our business has expended to new market

2. Human Resource

I4 The relationship between employees has been good

I5 Employees commitment to the firm is has been good

3. Financials

I6 Organization annual revenue has increased last year

I7 Firm profitability has improved last year

D. Family Dimension

The statements below relate to family dimension as performance indicators. Kindly rate the statements on the scale given below.


83



Statement 1 2 3 4 5

1. Satisfaction

I8 Family employees are satisfied by personal and business outcomes

I9 The creator (Owner) of the firm is satisfied by his business performance

SECTION D: EFFECT OF STRATEGIC FACTORS ON BUSINESS PERFORMANCE

This section seeks to determine the effect of strategic factors on growth of small scale family businesses. Kindly rate the statements on the scale given below.


Statement 1 2 3 4 5

E1 A shared vision between the Owner and all employees has played a major role in business performance

E2 Owners leadership has been crucial in increasing business performance

E3 Roles clarification and records keeping has been pillars in improving business performance

E4 Confidence in External managers brought a good business performance balance

E5 Appropriate skills in the firm and employees trainings is associated with positive business performance

E6 Business money and owner‟s money separation have been major in our business performance

E7 Culture and traditions guides our business processes hence it helps in improving business performance

THANK YOU FOR YOUR RESPONSE.

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Appendix II: Questionnaire‟s French Version

QUESTIONNAIRE D‟ENQUETE

Je suis Alain Birindwa Ndagano, étudiant en maîtrise en administration des affaires en gestion stratégique à Daystar University Kenya. Je mène une recherche sur les effets de certains facteurs stratégiques sur la croissance des petites entreprises familiales en République démocratique du Congo, le cas de la ville de Goma.

Selon certains attributs que vous portez, vous faites partis des petites entreprises

familiales, cela étant vous aviez êtes sélectionné en tant que répondant pour cette recherche. Veuillez accepter mon invitation à participer à cette recherche en ménageant un peu de temps pour remplir ce questionnaire. Il est administré à des fins de recherche scientifique et toute information fournie sera utilisée uniquement à des fins académiques et sera traitée avec une stricte confidentialité. Veuillez lire attentivement les questions et n'hésitez pas à y répondre en donnant votre réponse en cochant [√] l'option qui vous décrit le mieux ou qui s'applique à vous ou à votre entreprise.

SECTION A: INFORMATIONS GÉNÉRALES

(a) Veuillez indiquer votre âge: 20

ans - 30 ans [ ] 31 ans -

40 ans [ ] Au-dessus de

40 ans [ ]

(b) Veuillez préciser votre sexe: Homme [ ] Femme [ ]

(c) Quel est votre niveau de scolarité le plus élevé?

Niveau secondaire [ ] Graduat [ ] licence [ ] Master [ ]

(d) Quel est votre niveau dans la hiérarchie de gestion de l‟entreprise?

Top Management [ ] Middle Management [ ] Low Management [ ]

e) Depuis combien de temps travaillez-vous dans cette entreprise? {Cochez la case}

Moins de 1 an [ ]

1 an - 5 ans [ ]

6 ans - 10 ans [ ]

Plus de 10 ans [ ]

(f) Quelle est l'activité principale de l'organisation? {Veuillez remplir l'espace

vide} Bétail, agriculture et pêche [ ] Commerce général [ ] Exploitation minière [ ]

Construction [ ] Transport [ ] Pétrole et combustibles [ ]

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Industrie des télécommunications [ ] Prestations de service [ ]

g) Etez-vous un membre proche de la famille du propriétaire de l‟entreprise

? Oui [ ] Non [ ]

SECTION B: FACTEURS STRATÉGIQUES SÉLECTIONNÉS

Cette section cherche à déterminer les facteurs stratégiques utilisés par les petites entreprises familiales pour leur performance.

Les déclarations ci-dessous sont des facteurs stratégiques considérés comme vitaux pour la bonne performance d‟une petite entreprise familiale. Veuillez noter les déclarations sur l'échelle indiquée ci-dessous.

KEY: 1 = pas du tout; 2 = petite étendue ; 3 = étendue modérée; 4 = grande étendue; 5 = très grande étendue

1. Vision partagée 1 2 3 4 5

Le propriétaire a défini une vision claire pour l'entreprise et cette vision est partage avec tous les employés.

2. Le leadership du propriétaire

Le style de leadership du propriétaire est bien clair et l‟utilise correctement pour diriger l‟entreprise correctement.

3. Clarté de rôles et tenue des registres commerciaux

Les rôles et attributions de toutes les personnes impliquées dans les activités de l'entreprise sont très clairs.

Les documents importants et les données relatives à l‟entreprise sont bien gardés et peuvent être accessible au moment opportun par les personnes autorisées.

4. Confiance aux Managers externe (Non-familiale)

Tous les employés externes comme internes reçoivent un maximum de confiance et de soutien.

5. Compétences appropriées et formations des employés

Notre organisation dispose d'un personnel qualifié et utilise certain critères de compétences pour diverse positions.

Les compétences des employés sont développées à travers différentes formations.

6. Capital de l‟entreprise et l‟argent du propriétaire

Le capital d‟entreprise est utilisé uniquement pour les besoins

86



internes et le propriétaire n‟a aucun droit de l‟utilise pour ses raisons personnels ou familiales

7. Culture and traditions

Les procédures internes de l‟entreprise sont fondées et guidées par les us et coutumes de l‟entreprise

SECTION C: INDICATEUR DE LA PERFORMANCE

Cette section cherche à déterminer les paramètres utilisés par les entreprises familiales

à petite échelle pour évaluer leur

performance. a) Dimension commerciale

Les déclarations ci-dessous concernent dimension commerciale en tant que indicateur

de la performance. Veuillez noter les déclarations sur l'échelle indiquée ci-dessous.


Déclaration 1 2 3 4 5

1. Présence commerciale

Notre entreprise a enregistré une croissance de vente l‟année précédente.

Notre part du marché a augmenté l'année dernière

Notre entreprise pénètre de nouveaux marchés.

2. Ressource humaine

Les relations entre les employés ont toujours été bonnes

L‟engagement des employés vis a vis de l‟entreprise a toujours était bonnes.

3. Financier

87



Le chiffre d'affaires annuel de l'organisation a augmenté l'an dernier

La rentabilité de l‟entreprise s'est améliorée l'année dernière

b) Dimension familiale

Les déclarations ci-dessous concernent la dimension familiale en tant que indicateur de la performance. Veuillez noter les déclarations sur l'échelle indiquée ci-dessous.


Déclaration 12345

1. Satisfaction

Les membres de la famille employés dans l‟entreprise sont satisfais par les rendements sur le plan personnel et de l‟entreprise

Le propriétaire de l‟entreprise est satisfait par les performances de l‟entreprise

SECTION D: EFFET DES FACTEURS STRATÉGIQUES SUR LA PERFORMANCE DE L'ENTREPRISE

Cette section cherche à déterminer l‟effet des facteurs stratégiques sur la performance des petites entreprises familiales. Veuillez noter les déclarations sur l‟échelle donnée ci-dessous.


Déclaration 1 2 3 4 5 Le partage de la vision du propriétaire à tous les employés a joué un rôle majeur dans la performance de l'entreprise

Le leadership du propriétaire a été crucial pour accroître les affaires

La clarification des rôles et la tenue des registres de commerce ont été les piliers de l'amélioration des performances de l‟entreprise

La confiance donnée aux managers externes (personnes n‟appartenant pas à la famille) a apporté un bon équilibre de performance de l‟entreprise

88



Des compétences appropriées dans l'entreprise et la formation des employés sont associées à des performances commerciales positives

Le capital de l‟entreprise étant séparé de l‟argent du propriétaire a joué un rôle majeur dans notre performance

La culture et les traditions internes guident nos procédures de la gestion des affaires et contribuent donc à améliorer les performances de l‟entreprise.

MERCI POUR VOTRE RÉPONSE

89



Appendix III: List of SSFBs registered with FEC

NORD-KIVU /GOMA

COMPANY NAME SECTOR CONTACTS

DOMAINE DE Nom : SOKONI KAMBALE Katale KATALE

Sous-Secteur : Elevage

Tél : +243 997041493

[email protected]

EMIDO Nom : EUDOXIE NZIAVAKE Goma CONFECTION SAANANE

Tél : +243 997728273

Sous-Secteur : Elevage [email protected]

ETS MAKUTA Nom : EMMANUEL 28, A.Mont Goma, C/Goma, Q Les KAMANZI KAMANZI volcans BUSINESS

Sous-Secteur : Elevage

Tél : +243 816220626

[email protected]

LAPROVIDENCE Nom :Olive KAVUGHO AV. Alindi, n°20, C/Goma, Q.HIMBI AGRO-VET METYA

Tél : +243 977528599


THOMAS & Nom : RAJAN Des Ibis, C/Goma COMPANY VALIYAPARAMBIL

Tél : +243 991204214 AFRICALTO


15 ORAISONS Nom Goma

Sous-Secteur : COMMERCE Tél : +243 995471599

[email protected]

ACAD Nom ; Antoine KASUNGULA IMMEUBLE POSTE DE GOMA

Sous-Secteur : COMMERCE Tél : +243 997796571

[email protected]

AFRICAN OIL Nom 360, Av Walikale, BâtimeentJambo Safari SARL

Sous-Secteur : Transport

Tél : +243 997745179

Carburant [email protected]

AMI DU CHRIST Nom 34, Av, Bunia

Sous-Secteur : Alimentation Tél : +243 998669983

AMOUR DIVIN Nom : Floribert PALUKU 41, Av, Walikale, C/Goma. Q ; Himbi 2

Sous-Secteur :Alimentation Tél : +243 997743286

ATLAS DE Nom : ADRIEN Av. Mikeno C/Goma SECTEUR HABAMUNGU

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mailto:[email protected]









[email protected]

BOUTIQUE Nom Av.Touriste GLOCIA

Sous-Secteur : Alimentation

Tél : +243 997132541

[email protected]

BOUTIQUE YORN Nom : Sola HAMISI 21.Av. de la Corniche


[email protected]

CENTRE DE Nom : Muhindo LUSENGE Kanyabayonga NEGOCE DE


Tél : +243 995956829 KANYABAYONGA

COFFEE LAC Nom Av.Gabisha, Bujovu, Goma SARL

Sous-Secteur : Exportation Café

Tél : +243 974214758

[email protected]

ETABLISSEMENT Nom : KASEREKA MUHINDO 188, AV Mutakato, Commune de YETU

Sous-Secteur : Habillement KArisimbi

Tél : +243 973766147

[email protected]

ETS AKONKWA Nom : Josias CHIREZI 8.AV. du Marcé, Commerce, C/Karisimbi MUNGU NTAKUINJA

Tél : +24 997780711

Sous-Secteur :

ETS AMAZONE Nom : JEANNINE UZA Av. du Commerce. C/Karisimbi BUTSIRI

Tél : +243 997780711

Sous-Secteur : [email protected]

ETS BARAKA Nom : N‟SHOMBO KABA Avenue MIKENO, Goma

Sous-Secteur : Tél : +243 81183288

[email protected]

ETS COMPUTER Nom : BAHATI KIBANJA 18, AV du Gouverneur, C/Goma ,Q.les TECHNOLOGY

Sous-Secteur : Informatique Volcans

TELE- Tél : +243 998676799 COMMUNICATION

[email protected]

ETS HANI Nom : CLAUDE 28, Av, Accassian III, C/Goma HAKIZIMANA

Tél : +243 998753969


ETS LA Nom :Fanny TEMBO MOLO 14, Av. Butembo, C/Goma, Q.Les volcans MIGNONNE

Sous-Secteur : Electroménager

Tél : +243 998548828

[email protected]

91













ETS LA Nom : Faustin NDAGANO 96. Av. Présidentielle, C/Goma, Himbi/ PROGRESSION

Sous-Secteur : Alanine

[email protected]

ETS MAISON Nom : IRENE BUHORO 20, Av. Tulipier, C/Goma, Q.Les volcans IRENE


Tél : +243 993829261

[email protected]

ETS MAISON LA Nom : Goma VICTOIRE

Sous-Secteur : Vente Ciment

Tél : +243 998088010

[email protected]

ETS MALAIKA Nom : RICA BOLOGNA Goma (MADAMERICA

Sous-Secteur : Hôtellerie,

Tél : +243 815300835 BOLOGNA)

Habillement, Agriculture, [email protected] élevage

ETS MAUWE Nom : MAUWE MASSA 48. Av. Bukavu, Mikeno MASSA

Sous-Secteur :

Tél : +243 998674900

ETS MOKOTO Nom : Bertin KIRIVITA Av. Walikale, C/Goma


[email protected]

ETS MONTIGOMO Nom : Edouard MUSOLE 25, Av. Beni, C/Goma AMANI

Tél : +243 995652009

Sous-Secteur : Electroménager [email protected]

ETS MUSIHIRO Nom : Jacqueline CYETU Av. du Commerce, Q.les Volcans. MUHOZA C/Karismbi


ETS MWAJUMA Nom : MWAJUMA Boulevard Kanyamuhanga


[email protected]

ETS TSOKAS Nom : TSONGO KASEREKA Goma


GROUPE Nom : MOAEJ MUKHIDA 11, Av.Butembo, C/Goma.C/KArisimbi D‟INTERET


Tél: +243 972361111 ECONOMIQUE

KIM HOUSE Nom : ISAAC KAMBALE 31. Av. Nyiragongo.C/Karisimbi MUKAMA

Tél : +243 997296014

Sous-Secteur : Electroménager [email protected]

KIVU MOTOR Nom : OT JACQUES PASCAL 12. Av. Ishasha. C/Goma, Katindo Gauche

Sous-Secteur : Automobiles ou

92











pièces de rechange Tél: +243 998714045

[email protected]

www.kivumotor.com

MATONDO Nom : Antonia ELEANYA Touriste, n°02.C/Goma. Q. Les volcans UWAOMA

Tél : +243 998187941

Sous-Secteur : Habillement [email protected]

MAVWE MASA Nom : EMMANUEL Av. BlvdKarisimbi, C/Goma KAMBALE KIOMA

Tél : +243 998674900

Sous-Secteur : Habillement

MEGABYTES Nom : KAMBALALA RUSINA Av. Karisimbi, C/Goma. Q.Les volcans SYSTEM

Sous-Secteur : Informatique

Tél : +243 98623111

[email protected]

MWANAW‟EKA Nom : Elias MUHINDO Av. Touriste MWANAW‟EKA

Tél : +243 998625535

Sous-Secteur : Papeterie mwanaw‟[email protected]

PREMIER Nom : SIMON MUHAYIRWA Route Aéroport, N°20, C/Karisimbi, LOGISTICS KAZUNGU Q.Byahi


[email protected]

SEULE LA FOI Nom : Marie ULIMUBENSHI Av. de Touriste

Sous-Secteur : Import-Export Tél : +243 994033405

[email protected]

SOCIETE KINSHOP Nom : Boulevard Kamnyamuhanga SARL

Sous-Secteur :

Tél : +243 994076309

[email protected]

TOP GOMA Nom : JEAN-CLAUDE 13, Av. butembo, C/Goma BUSINESS SIMPEZE

Tél : +243 990105178


www.tgb-cim.net

TOP QUALITY Nom : DANNY MUDERWA Av. Butembo, C/Goma. Q. Les volcans GROUP DUNIA

Tél : +243 994008545


A.S.G MINES

Nom : Yvette MWANZA 36. Avenue Grevilleas

Sous-Secteur : Exploitant Tél : +243 990664039

[email protected]

93




http://www.kivumotor.com/







http://www.tgb-cim.net/



ALPHAMIN BISIE Nom : Richard ROBINSON 32, Av. du Lac, Commune de Goma. Q. MINING

Sous-Secteur : Exploitant Himbi

Tél : +243 810003943

[email protected]

METACHEM SARL Nom : 37, Avenue Tulipier, Goma


[email protected]

www.metachemsarl.com

SOCIETE MINIERE Nom : BEN Av. de la Corniche, Goma DE BISUNZU SARL MWANGACHUCHU

Tél : +243 974341323

Sous-Secteur : Exploitant [email protected]

www.smb-sart.com

ETS MY FRIEND CONSTRUCTION AV.Du Commerce

Nom : SIMON MATONDO Tél : +243 99413752 MANSIANTIMA www.smb-sart.com

Sous-secteur : Matériaux de construction

SOCIETE Nom : MODESTE 360 AV.Walikale, C/Goma CONGOLAISE DE MAKABUZA

Tél : +243 997745179 CONSTRUCTION

Sous-secteur : Entreprise de [email protected] construction

BUSY BEE CONGO TRANSPORT 8 , AV. Grevelleas, C/Goma.Centre Ville

Nom : MARIAM MATONDO Tél : +243 8110011

MY FRIEND Nom : SIMON MATONDO AV.duCommere, C/Goma. Q. Les Volcans

Sous-secteur : Routier Tél : +243 9941352

[email protected]

STATION JAMBO Nom : Makuza Goma SAFARI

Sous-secteur

Tél : +243 998513662

[email protected]

TRANSPORT ET Nom : JOSE ESSELEN 250/04, Av.de l‟Industrie MESSAGERIE DU

Sous-secteur : Routier

Tél : +243 998802743 KIVU SARL

www.tmkcongo.com

ARIANA Nom : TSONGO KAVIRA Du 20 Mai, C/Karisimbi ,Q. MURARA

Sous-secteur : hydrocarbures Tél : +243 998668104

[email protected]

STATION KMJ Nom : Jean KASHABANA AV. Rondpoint-Goma

Sous-secteur : Importateur Tél : +243 994404201

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http://www.metachemsarl.com/


http://www.smb-sart.com/

http://www.smb-sart.com/




http://www.tmkcongo.com/


[email protected]

STATION NI YETU Nom : KAMBALE MONDO Route Sake

Sous-secteur : Distributeur Tél : +243 994401166

[email protected]

STATION Nom : Paul BIZIMANA BIN 7.AV.DU 30 Juin, Commune de Goma PARAKOUSSAS RWEMA

Tél : +243 99776985

Sous-secteur : Importateur [email protected]

STATION SIMBA Nom : Dieudonné [email protected] SERVICE KOMAYOMBI SIMBA

Sous-secteur : Distributeur

M&ICT Nom : VICKY SANGARA 1,AV.Bishweka, C/Goma, Q. Les Volcans SOLUTIONS

Sous-secteur : Province Internet

Tél : +243 997740385

[email protected]

GOPHER Nom : Philippe KASEREKA AV.Tulipiers, C/Goma.Q. Les Volcans LUBUNDU [email protected]

Sous-secteur : GSM

ETS MAISON LA Nom : THANA 32.AV.NYAKAGOZI,C/Karisimbi, VICTOIRE TWAGIRAYEZU Q.Bujovu

Sous-secteur : Production de la [email protected] cigarette

ETS MAISON 30 AV, Touriste, Q. Les Volcans, C/Goma MBIZA

MAIZEKING Nom : KAMBALE KANDUKI 1, AV. Mont Hoyo, C/Karisimbi

[email protected]

NEW DEAL SARL SERVICE 43. AV. La Frontière, C/Goma CIMAK

Nom : PACIFIQUE

Tél : +243 998668422

NYAKABASA [email protected]

Sous-secteur :

NGOJA-NGOJA Nom : ANDRE NGOJANGOJA Tél : +243 998624964

Sous-secteur : Hôtel, restaurant [email protected]

BUSINESS Nom : EVARISTE RUYANGE IHUSI Bulding, 2ème

Niveau Goma CONSULTING

Sous-secteur : Tourisme

Tél : +243 975912000 CORPORATION

d‟affaires

SARL [email protected]

GOUPE CONGO Nom : ALAIN MATHURE 162, AV. ALINDI, C/Goma, Q.Himbi LODGE

Sous-secteur : Hôtel, restaurant

Tél : +243 971839028

[email protected] , www.congo- lodge.com

95















http://www.congo-lodge.com/

http://www.congo-lodge.com/

ETS Nom : MUSANGANYA 114, AV. LA Frontière, Katindo MUSANGANYA LUBONGERA

Tél : +243 998766500 LUBONGERA

Sous-secteur : Hôtel, Restaurant [email protected]

ETS COTECH-TEL Nom : Paon BAHATI 18, AV, Du Gouverneur KIBANJA

Tél : +243 998676799

Sous-secteur : Hôtel, Restaurant [email protected]

Source FEC 2018 Annual Report

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Appendix IV: Research Permit and Research Authorization

97



98



Appendix V : Ethical Approval

99



Appendix VI : Anti-Plagiarism Report

100



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