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European Scientific Journal November 2015 /SPECIAL/ edition ISSN: 1857 – 7881 (Print) e - ISSN 1857- 7431IMPACT OF BUSINESS ENVIRONMENT ONORGANIZATION PERFORMANCE IN NIGERIAA STUDY OF UNION BANK OF NIGERIAGloria Obiageli EruemegbeHead of Flexcube Functional Support, Branch Operations Coordination,Union Bank of Nigeria Plc.AbstractThe study seeks to unravel the factors that affect constructionworkers’ motivation and the corresponding effect of the identifiedmotivational factors on workers’ performance and overall productivity. Toanswer research question and test formulated hypotheses, the study relied onquestionnaire to generate relevant data out of 39 questionnaires administeredon officers in Union Bank of Nigeria, Lagos, only 20 were properlycompleted and returned. This gave an effective response rate of 51%. Thesurvey revealed that, among the top ten critical factors (i.e. teamwork, workbased on contract, supervision based on leadership by example and provisionof equipment) had great effect on motivation as well as impact onproductivity. More so communication, love and belongingness, opportunityto undertake challenging task, identification with goal and overtime wereamong the critical factors.Keywords; Concept of Environment, Business Environment, OrganizationalPerformance and Effects of Business Environment on OrganizationalPerformanceIntroductionBusiness is any commercial or economic activity that tends towardsbusiness profit. The primary, objective of business organizations is to makeprofit, grow and survive in the environment in which it operates.The environment in which business organizations operate is acomplex, multi-focus dynamic and has a far reaching effect on suchorganization. The environment tends, shape the outlook, and goal of theorganization by placing constraints on them. These constraints in theenvironment of organizations goal could be in the form of competition, thissets a limit on the goals specify by the organization. For instance, trade unionasking for increase in salary, will affect the shareholder dividend. Unethical478

European Scientific Journal November 2015 /SPECIAL/ edition ISSN: 1857 – 7881 (Print) e - ISSN 1857- 7431behaviour also affects profit. All these settings provide multiple contexts thatinfluence how the organization operates and how and what it produces.(Oghojafor, 1998)In management, the word “Environment” does not necessarily meanphysical surroundings, but is used to describe all those influences that bearupon the individual organizations. Business environment is used to meananything, which surrounds the business organization. It affects the decisions,strategies, process and performance of the business. The environment isconsisting of factors which are beyond the control of the business (STEP)social, technological, economical, legal and political. It providesopportunities or poses threats to the organization.Since business makes demand on the society and the society makesdemands on the business, managers in any organization must interact withand respond to environmental factors internal or external to theirorganizations. The sum of these interrelationships within the business andbetween the business and the society is what is the management regarded asbusiness environment.Organizations survival and success depend on the appropriateadoptions to a complex and over changing environment. It is pertinent fortop management of organization to identify opportunities and threats in theexternal environment. Internal environment, it should focus on strengths andweakness, potential and existing ones. It should respond swiftly, in order toknow where it can have competitive advantage over its rivals. Therefore, anyorganization should look or search its environment continuously. Oghojafor(1998).The Nigerian business environment has witnessed a lot changes fromthe period of the oil boom in the 1960s and the early 1970s. Austeritymeasures in the early 1980s and the structured adjustment programme in thelate 1980s from the company act of 1960s allied matter decree in the 1990s,undoubtedly brought in the eighty’s the opportunities to be exploited bysome firms or the problems that inhibit the survival of so many businessfirm.The need for studying business environment became importantconsidering the fact that business organization do not operate in vacuum andeffective management in complex and dynamic society such as Nigeria,requires the assessment of strengths and weaknesses of the organization andthe opportunities and threats posed and the challenges of the externalenvironment by the challenges of the external environment. For survival andgrowth, organization must adapt to these changes. The objective of this studyis to examine the impact environmental challenges on the performance ofbusiness organization.479

European Scientific Journal November 2015 /SPECIAL/ edition ISSN: 1857 – 7881 (Print) e - ISSN 1857- 7431Objectives of the studyi. To determine the extent at which environment factor affect Nigeriabusiness.ii. To evaluate business environment in order to ascertain the type ofenvironment suitable for growth and developmentiii. To add to existing knowledge in various categories of business sectorsiv. To explore ways in which effective performance can be ascertainedv. To examine the environment and business relationship.Research questionsi. How does an economic problem affect the business environment?ii. How does the improvement on technological level affect development inbusiness environment?iii. How does ethnical behaviour affect the performance of employee or anorganization in the environment?iv. To what extent will political instability affect business environment?Concept of environmentEnvironment is the totality of the surroundings of the organization forwider concept. Harrison (1996) defines environment as all the conditionscircumstances, and influences surrounding and affecting the development ofthe total organization or any of its internal systems. He argued thatenvironment contains forces of complexity that are dynamic to varyingdegrees at differences, and under different circumstances.Atsegbua (2002) described environment as the system of abiotic,biotic and interact and simultaneous to which he adapts and transforms anduses in order to satisfy his needs.The Black Law Dictionary (6th edition) physical, economical,cultural, aesthetic and social circumstances and factors which surround andaffect the desirability and value of property and which also affect the qualityof peoples’ lives.In environment, the word “environment” is used to describe all thoseinfluences that bear upon the individual organization. Bernard (1999) notesthat environment consists of atoms and molecules, agglomerations of thingsin motion, laws of men, emotions of physical laws, social laws, social ideas,norms, action, of forces and resistances. Their number is infinite and they arealways changing.The nature of the constituting the environment often confrontsmanagement with the need to make decisions under considerable uncertainty.The dynamitic nature of variables that are seldom well identified theircontrols over the outcomes of events initiated within the organization arealso complex. However, the frequent lack of control does not mean that480

European Scientific Journal November 2015 /SPECIAL/ edition ISSN: 1857 – 7881 (Print) e - ISSN 1857- 7431management should disregard the environment, but rather that it mustundertake continuous surveillance of the environment so it may respond toadverse reactions or outside changes.Every organization must exist in some extent; no organization is anisland unto itself. Each organization has goals and responsibilities relates toothers in its environment. Not only must or organization deal with itsenvironment in coordinating its everybody’s affairs, but it is must also giveconsideration to the goals of others, as it establishes its own goals andconducts its operations.Business environmentAs a concept, business environment is regarded to be a complex andimportant consequent, the concept has been addressed in a number of waysby different scholars. For example Ola (1993) seems to believe that businessenvironment is phenomenon that is too complex and too varied to becaptured by any one definition.The important of business environment has been attested to bynumerous scholars such as Oyebanji (1994), Lawal (1993) and Aldrich(1979). All these scholars have discussed extensively that businessenvironment is an important process to influence on a group in particularsituation to motivate others to goals achievement. Environment inmanagement does not mean the surrounding but it covers the factors offorces that affect business effectiveness in the process of producing anintending result.Oyebanji (1994) defined business environment as those factors thatcan influence the individual’s business organization. He stressed further bysaying that every organization must take into consideration theenvironmental constraints, material and human resources in their respectivebusiness in spite of their differences in status and that the effect of theenvironment caries from one situation to another.Ola (1993) classified Nigerian business environment as the Nigerianeconomy since the businesses are established and managed within aneconomy. He was of the opinion that the state of affairs has a significant onthe business within that economy.Oyebanji (1994) further testified that Nigerian business environmenthas witnessed a total change, which started from the oil boom era in 1960sausterity measure in the early 70’s and structural adjustment programme inthe 80s.Aldrich (1979) said the environment was made up of stable andunstable homogenous, heterogeneous, rich and poor, complex and simple,unpredictable variables. He further stressed that business environmental481

European Scientific Journal November 2015 /SPECIAL/ edition ISSN: 1857 – 7881 (Print) e - ISSN 1857- 7431factors change along with factors of production and environmentalinfluences may be stable over a certain period of time.The assertion was supported by Ashley and Van de Van (1986),which had the view that the manager’s basic role is to be able to manage andcontrol the organization in the difficult and emergency period. Changes takethe form of adaptation. The manager must perceive the process and respondto a changing environment by re-arranging the internal organizationstructures so as to ensure survival and effectiveness. The need for studyingbusiness environment is important considering the fact that businessorganization do not operate in a vacuum, effective management to complexand dynamic society requires the assessment of strength and weakness of theorganization and the opportunity and threat posed by the challenges of theexternal environment. For survival and growth, organization must adaptthese changes.Types of environmentThere are two types of environment namely, External environmentand internal environment (Lawal, 1993).The Internal EnvironmentThis includes situational factors within the organization. Thesefactors are largely the result of decisions of the management process, mosttimes under management control. It is described as the resources, behaviour,strengths, weaknesses, synergy and distinctive completeness within orinternal to the organization.An organization uses different types of resources produces synergy ordynergy within an organization which leads to the development of strengthsof weaknesses over a period of time.Organizational capability in the design and implementation ofcorporate policy and strategy rests on the organization’s capacity and abilityto use its distinctive competencies to excel in a particular field.There are five major variables within the organization thatmanagement must consider:(i) Objectives (ii) Structure (iii) Tasks (iv) Technology (v) PeopleObjectivesThese are the specific desired results, the group wishes to attain, byworking together. Management’s development of objectives through theplanning process is a powerful mechanism of co-ordination. It helps themembers of the organization know what they are expected to accomplish. Ithelps the members of the organization know what they are expected toaccomplish. The objectives could be in terms of increase in profit,482

European Scientific Journal November 2015 /SPECIAL/ edition ISSN: 1857 – 7881 (Print) e - ISSN 1857- 7431productivity, cost-effectiveness, market shares, quality service, and newproduct development, management training and selection, Socialresponsibility etc.StructureFormal organizations are made up of several levels of managementand sub-units called functional areas in marketing, personnel, finance,productions etc. Structure of an organization is the logical relationship ofspecific management levels and functional areas arranged in such a way as topermit the effective attainment of objectives.TasksAssigned work to be completed in a specified manner within aspecified period of time. An outgrowth of the division of labour is thecreation of tasks. Based on management’s decision on structure, eachposition is assigned a set pf tasks, intended to make a contribution to theattainment of the organization’s objectives.TechnologyThis is a management raw material - people, information, or physical;materials - into desirable goods and services. It also includes machines,equipment supplies of knowledge used in the transformation process.PeopleWhen we speak of organization, management, subordinates, workerswe are simply describing groups of people. When a factory close an abstractman management did not make that decision some individual did. When acompany’s product is of low quality, it is people who have not done their jobcorrectly. Management attains its objectives through people-therefore,people are important and these differences must be learned. Research hasshown that the probability of any two people behaving in an absolutelyidentical manner i