Factors influencing organizational culture on business performance among employers in technological micro-enterprises

Microenterprises are crucial in sustaining the economy, especially in developing economies like Nigeria. Many of these microenterprises do not take cognizance of necessary determinants like organizational culture and its factors to ensure proper running of their day-to-day activities. The study aims to identify some demographic statistics of employers in technological microenterprises, investigate the factors influencing organizational culture and assess organizational culture's influence on business success among employers in selected technological microenterprises in southwest Nigeria. The study was carried out in three southwestern states in Nigeria with 213 business owners (employers) as respondents. Seventeen factors were explored, but eight were extracted to be considered in measuring the employers' organizational culture: climate, customer demand, technological changes, observed behaviour, norms, consistency, adaptability


Introduction
Microenterprise is a cottage industry.According to the 13 th National Council on Industry (2001) meeting, it is a type of industry whose maximum asset base is ₦1.5 million as working capital without the cost of land and has a staff strength of not more than ten.The National Policy on MSMEs report (2010) defines microenterprises as business enterprises with maximum assets of N1 million with staff capacity between one and ten without land cost.Microenterprise is the least in all features of available enterprises.Other enterprises are small, medium, and large.They vary by working capital, land mass, and number of staff.All these enterprises are the bedrock of moving economies (Marquez and Ortiz, 2020;Ahmad, 2016;Adekunle, 2011;Effiom and Edet, 2018).
Microenterprises are known for performing the responsibility of providing goods and services, motivating entrepreneurial spirit, providing credit, and repairing secondhand products.Employment opportunities and a high standard of living are generated; they ensure competition and supply the needs of society and raw materials for other firms (Okunbanjo, Ojenike and Fakunmoju, 2022;Ajibefun and Daramola, 2003).Using Nigeria as a case study, microenterprises play a vital role in economic development and are recognized as the main engine of economic growth.They also help promote private sectors and partnerships (Etuk, Etuk, and Baghebo, 2014).The Nigerian government confirmed that about 98 percent of the 1.8 million jobs generated yearly since 2011 are from microenterprises (NBS, 2016).Microenterprises have significantly increased economies by generating employment and improving economic growth and development.Challenges paramount to developing economies, like unemployment, hunger, poverty, and regional imbalance, are curbed by promoting microenterprises.Technical microenterprises promote the nation's economic growth by creating new ideas and renovating the ideas into realities to better the nation's economy (Kale, 2019;Chen, 2010).
The study aims to identify some demographic statistics of employers in technological microenterprises, investigate the factors influencing organizational culture, and assess organizational culture's influence on business success among employers in selected technological microenterprises in southwest Nigeria.

Literature Review
Entrepreneurship can be classified into commercial and technical entrepreneurship based on the risk and uncertainty associated with entrepreneurship.The latter involves producing technical services or manufacturing products, while the former consists of buying, selling, and trading non-technical services (Siyanbola, Aderemi and Egbetokun., 2011;Mignenan, 2023;Estrin, Mickiewicz and Stephan, 2016;Afonja, 1999).Technological microenterprises are enterprises with between one to ten employees, less than ₦5 million capital assets, and use technology during operations (Bailetti, 2012;Motiei, 2023).These sets of enterprises are in production with the use of machinery.Chowdhury (2011) ascertained that technological microenterprises are the engines of economic growth due to their substantial contribution to production and employment-generating opportunities.Other than entrepreneurs that are classified as technical entrepreneur, commercial entrepreneurs are also encouraged to adopt the use of technology for their businesses to be relevant in modern business environment (Qureshi, Kamal and Good, 2008).According to Wolcott, Qureshi and Kamal (2007), microenterprise experiences the same growth barrier as technology such as access to capital, educational level of the entrepreneur and the legal barrier.These problems are more obvious in developing countries.However, it was also noticed that it is easier to start a microenterprise in developing countries more than developed once based on various administrative bottleneck required for small businesses to be established and the varying level of incomes of people (Fajnzylber, Maloney and Roja, 2006;Jayachandran, 2020).One of the determinants in the performance of these technological microenterprises is the understanding of organizational culture by the owners or employers.
There is no generally acceptable explanation of organizational culture (OC).Understandably, human beings are essential members of various cultures with no option to select nationality, ethnicity, family, religion, and others (Alan, 2016;Can Bicer, 2022).Individual organizations have specific cultures, so OC differs for every organization.Therefore, each organization needs to retain its unique culture, which will be reflected in the actions of its staff or employers.Some organizational cultures may not be directly related to higher productivity and effectiveness than others.Research work from all over the world with various areas of studies like anthropology, sociology, and business management have explained culture and treated culture as something inherent in social life which develops for an extended period as entities relate with each other and come together as a recognized social group such as nonprofit organizations (NGO), communities, tribes, states, companies, and countries.To elucidate organizational culture, academia has drawn various ideas and theories from different disciplines (Sociology, Anthropology, and Psychology) (Petraite and Ceicyte, 2012).Researchers from management science, organizational behaviour, and communication define organizational culture as an open outcome of the decisions made by a group of people to accept their behaviour as they interact with each other and external key stakeholders of the organization, such as regulators, suppliers, and customers relationships, and practice to improve ways to handle their wider social environment (Wuthnow and Witten, 1998).Hill and Jones (2001) defined organizational culture as the precise collection of norms and values shared by people and groups in establishing and controlling how they relate with each other and with outside stakeholders in the organization.Organizational culture is further defined by Schein (2005) as a series of common assumptions that a group of people absorbed to curb internal integration and external adaptation that has a pattern of shared basic assumptions that the group learns as it solves its problems of external adaptation and internal integration that has functioned well enough to be rated valid and also to be transferred to new generations as a means to think, perceive and feel related to existing challenges.From the above definitions, organizational culture involves how people in an establishment, organization, or firm share tangible and non-tangible assets both within and outside the involved organization.Organizational culture provides a cognitive map and mechanism, values, or norms of the organization that members follow, which determines how people in such an organization think, behave, or make decisions consciously or unconsciously (Eyibio 2022).Lubis and Hanum (2020) explain that Organizational Culture clarifies and reinforces standards of behaviours and work routines of employees.It also increases interaction, communication, and mutual respect between individuals.
Nigeria is a developing economy with a high rate of unemployment, poverty, and hunger with other challenges, which led to the introduction of Millennium Development Goals (MDGs) in 2000 and a few years after the inception of Sustainable Development Goals (SDGs) in 2015 have made room for improvement in encouraging the growth and development of microenterprises in Nigeria.The inception and sustenance of these microenterprises have faced and are still facing many challenges.One of the challenges is that some enterprises do not take proper notice of their organizational culture to achieve business success, which adversely affects their performance (Etuk et al., 2014;Adeyinka and Umar, 2021;Halim, Ahmad and Ramayah, 2019).Also, some researchers, such as Mashal and Saima (2014), have reiterated the effect of organizational culture on business performance and, hence, the need for organizational culture in management research.Moreover, an assessment of academic literature on organizational culture and business performance by Olu (2014) shows a dearth of literature on organizational culture and business performance in developing countries, in which Nigeria is a case study.The effects of organizational culture on business performance among microenterprises in Nigeria are not well studied.This gap was identified, and this study was designed to address the challenge.

Research & Methodology
The study adopted a quantitative approach and purposefully selected three states from six in southwestern Nigeria due to the highest numbers of microenterprises.The respondents are divided by the ratio of microenterprises in each state to the total number of microenterprises using population/probability proportion to size (PPS) (Skinner, 2016).The respondents were employers of microenterprises who produce using technology.The study used Yemen's sample size rule to calculate the sample size of the known population.The result provides 213 respondents, and 169 properly completed copies of the questionnaire were retrieved from study participants.The PPS results made the study have 106 respondents from Lagos State, 62 from Oyo State, and 45 from Osun State.However, only 87 were returned from Lagos State, 46 from Oyo State, and 36 from Osun State, totalling 169 respondents.The study used factor analysis (Extraction methodprincipal component analysis) to analyze the data.Seventeen factors were measured to investigate the influence on employers' organizational culture.The factors are climate, leadership experience, global competition, customer demand, technological change, uncertainty, employee management, strategic focus, criteria for success, observed behaviour, norms, dominant values, rules, involvement, consistency, adaptability, and sense of mission.Linear regression analysis was also used to measure the impact of organizational culture on the business performance of technological microenterprises, with SPSS used as a statistical tool.

Socio-Demographic Characteristics of Employers' Organizational Culture
Table 1 shows the socio-demographic characteristics of employers of technological microenterprises in selected states in Southwest Nigeria.The maturity age is presently rated eighteen (18) years, and it is believed that individuals of this age can make the best decisions for themselves (NFS, 2018).Most employers fell within the range of 38 to 47 years, followed by 48-57 years, then 28-37 years, and 18-27 years.These outcomes fell within the workforce populace in Nigeria (NFS, 2018).Also, the study shows more males (56.8%) in technological microenterprises than females.
Nevertheless, the involvement of females is now increasing in technical enterprises compared to how it has been in the past.Also, field results showed that most of the microenterprises were being coordinated like family businesses, which involved the husband, wife and children.Their educational level was also measured, and the result shows that almost all business owners in this category of microenterprises were educated, which means almost all of them could read and write.The largest proportion of them were graduates of either polytechnic or University.About 94% of them have a minimum of secondary school leaving certificates, allowing them to reason towards innovation faster.This conforms to Onyeneke and Iruo (2012), who state that over 90% of entrepreneurs were educated, contrary to Odebiyi and Olaoye (2012), most enterprise owners are illiterate or semi-illiterate who happened to be formal school dropouts.

Factor Analysis
Table 2 shows the descriptive analysis of 17 factors for the organizational culture of employers.The mean was measured using a Likert scale ranging from 1 to 5 with a mean value of 2.5.The result of the analysis shows that all the factors are above average.The values are very much above the mean.From the table, the standard deviation outcome shows little deviation of the factors from the mean values.

Assumptions of factor analysis:
Table 3 shows the basic conditions in factor analysis that should be met.The conditions are KMO and Bartlett's test of sphericity and determination.Kaiser -Meyer -Olkin (KMO) measure of sampling adequacy assumption ranges between 0 and 1.Any value less than 0.5 is said to be inadequate for the analysis.The solution is either to add to the respondents or add to the variables.Any value above 0.5 is acceptable for further analysis, but there are standard levels according to the result.If the outcome is between 0.5 and 0.7, they are assumed to be mediocre, 0.7 to 0.8 are good, 0.8 to 0.9 are very good or great, and above 0.9 is assumed to be excellent or superb (Kaiser, 1960).The KMO result from Table 3 is 0.897, which is between 0.8 and 0.9, and it is assumed to be great or very good.Therefore, factor analysis using the KMO test is acceptable for these data.
Bartlett's test of sphericity measures the significant value of the factors, and it is to confirm if the original correlation is the same as the identity matrix.The assumption of Bartlett's test of sphericity should be less than 0.05.Bartlett's test outcome for this study is 0.000, which confirms that the data set for this analysis is appropriate.
The third assumption is that the determinant value from the correlation matrix must be greater than 0.00001 for the data set to be appropriate for further analysis.The determinant value for this study is 0.0001786 (1.786 E -04), which is greater than 0.00001.Therefore, the basic assumptions of factor analyses were met.

Correlation matrix:
Table 4 is the correlation matrix table, which shows the pattern of relationship between the correlation coefficient of the factors.
Checking through the correlation coefficients in Table 4, no value is greater than 0.9.If any value is found, the data set will have a problem of singularity.If there is a singularity problem, such a variable will be removed from the other variables for further analysis.The determinant value is also important in determining if there is multicollinearity in the data set and determining the variables to be eliminated.Still, the output here is 0.0001786, which is greater than 0.00001.So, there is no problem of multicollinearity and no variable to be eliminated from the factors in the data set.

Total Variance Explained
Table 5 explains the total Variance, consisting of initial eigenvalues and the extracted sum of squared and rotated sums of squared loadings.Each factor (component) has its initial eigenvalues.The initial eigenvalues decrease from the first to the last on the   Therefore, three factors were extracted.The eigenvalues after rotation are to optimize the three components before rotation.They were optimized to reduce the gap between the variables.Looking at Table 5, the first factor before rotation has 49.113, the second factor has 7.031, and the third factor has 6.214, with a large gap, especially between the first and second factors.Still, after rotation, the first factor is 29.481, the second is 25.551, and the third is 7.326.Comparing the output before and after rotation, the gap has been reduced to optimize the three factors.

Communalities
Table 6 is the communalities table showing the communality values before and after the extraction of variables.The initial communality values before extraction for all factors are 1.000.In contrast, after extraction, the values are always less than 1-the communality values after extraction help in knowing the factors to extract.Table 5 has given us a pre-knowledge that a minimum of 3 factors will be extracted.In understanding the factors to extract, some considerations are to be checked.The first is pre-knowledge from the table of Variance explained, which made the study know that a minimum of 3 factors will be extracted.Jolliffe (1972) suggested that factors with values above 0.7 should be selected, but after extraction from Table 6, the values have just two factors greater than 0.7, which contradicts the conclusion from Table 5.The study further investigated Field's (2005) criterion that average communalities' value should be obtained, and any factors with values greater than average communalities' values should be extracted.The average communalities value is (10.602/17)= 0.624.All communality values after extraction greater than 0.624 were extracted.Therefore, eight factors were extracted, and the factors are climate (the employers can manage the challenges of the external environment of the organization), customer demand (employers easily meet the customers' requirements), technological changes (employers adhere to changes in technology), observe behaviour (employers do manage the daily Attitude at the place of work), norms (employers do obey the rules and regulations of the organization), consistency (employers are always participating in every action at work), adaptability (employers always make the working environment conducive for all), and sense of mission (employers knows what to do and what not to do per time).Linear regression analysis was used to show how organizational culture affects business performance among employers of technological microenterprises.Table 7 is the model summary of linear regression analysis for microenterprise employers.It shows the correlation between the dependent and independent variables.The R (0.251) is the Pearson correlation between independent variables (organizational culture) and dependent variables (business performance).R-squared (0.063) is the linear correlation coefficient showing that the independent variables explain just 6.3% of Variance in the dependent variable.The adjusted R 2 (0.057) is the degree of fitness within the variables.At the same time, the standard error shows variation from the population of microenterprises in Southwest Nigeria due to variability within the explanatory variables. of freedom (df) = 168, which is calculated as (N-K-1) where N = total number of respondents and K is the number of variables used in the study, which is 1 in this case.The significant F value F (1, 167) = 11.249,sig = 0.001 (p<0.05)means that there is a positive and significant relationship between business performance and organizational culture.Table 9 shows the coefficient values for linear regression equations.The B is the unstandardized coefficient, and Beta is the standardized coefficient.Considering the p-value of the t-test of each independent variable (0.001), it can be concluded that organizational culture significantly and positively influences business performance.

Conclusion
In summary, 17 factors were analyzed for the organizational culture of employers in microenterprises.The basic assumptions of factor analysis were met.The correlation matrix coefficient has no problem of singularity.The total Variance explained shows that the first factor explains about 49% of the total Variance and that only three factors can be extracted.Going with other criteria of variable extractions, eight variables were extracted: climate, customer demand, technological changes, observed behaviour, norms, consistency, adaptability, and sense of mission.The results from linear regression analysis show that organizational culture positively impacts business performance, which means the kind of organizational culture in microenterprises determines the level of business performance.In conclusion, the eight variables extracted are important factors to consider when measuring employers' organizational culture in technological microenterprises in southwest Nigeria for better business production.Also, organizational culture positively and significantly influences business performance at a 5% significance level.

Table 1 :
Employers' socio-demographics characteristics and background information

Table 2 :
Descriptive Statistics of Employers' Organizational Culture

Table 3 :
KMO and Bartlett's Test of Employers' Organizational Culture

Kaiser-Meyer-Olkin of Sampling Accuracy 0.897
table.Each initial eigenvalue shows the amount explained in the total Variance.For instance, the first factor explained 49.113% of the total Variance; likewise, each of the other factors has the value it explained in the total Variance.The extraction sum of squared loadings is the eigenvalue before rotation.It only consists of values when the initial eigenvalues are greater than 1.There are three factors whose initial eigenvalues are greater than one, and these three factors explained 62.358% of the cumulative Variance in the 17 components.The second component explained 7.031% of the total Variance.The eigenvalues before rotation show the number of factors to be extracted from the table.

Table 5 :
Total Variance Explained of Employers' Organizational Culture

Table 7 :
Model Summary

Table 8
is the Analysis of Variance (ANOVA) table of linear regression analysis for microenterprise employers.The table's degree