Content uploaded by Suleiman Usman
Author content
All content in this area was uploaded by Suleiman Usman on Nov 09, 2022
Content may be subject to copyright.
The International Journal of Business and
Management Research
A refereed journal published by the International Journal of Business and Management
Research
2020 Issue
The International Journal of Business and Management Research (IJBMR) is published annually on
December of every year via digital media and available for viewing and/or download from the
journal’ s web site at http://www.ijbmr.org
Volume 13, Issue 1
The International Journal of Business and Management Research (IJBMR) is a peer reviewed
publication, USA. All Rights Reserved
www.ijbmr.org
ISSN: 1938-0429
Editorial Review Board
Editor-In-Chief: Dr. John Phillips
Dr. C. Abid
Dr. F. Albayati
Dr. H. Badkoobehi
Dr. A. Ben Brik
Dr. A. Caplanova
Dr. I-Shuo Chen
Dr. Firend A. Rasch
Dr. F. Castillo
Dr. J. Fanning
Dr. K. Harikrishnan
Dr. J. Hamra
Dr. Anthea Washington
Dr. Ahmad Jaffar
Dr. M Al Kubaisy
Dr. M. Khader
Dr. M. Lakehal-Ayat
Dr. B. Makkawi
Dr. Mona Mustafa
Dr. P. Moor
Dr. P. Malyadri
Dr. R. Pech
Dr. N. Maruti Rao
Dr. J. Ryan
Dr. K. Rekab
Dr. I. Rejab
Dr. M. Shaki
Dr. P. Moore
Dr. S. M. Safaei
Dr. R. Singh
Dr. M. Shaki
Dr. B. Swittay
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
4
Dr. R. Wilhelms
Dr. Jui-Kuei Chen
Dr. R. Sergio
Dr. R. Tahir
Dr. D. Wattanakul
Dr. Soe Mynt Than
Dr. Aysar Philip Sussan
Dr. K. Kooli
Table of Content
Antecedents and consequences of organizational gendering
Meredith Downes, Alex J. Barelka ………………………………….…………………………6
Developing Female Intrapreneurship-A study about the role of Female Entrepreneurs employed in
the University Partnership Programme in London, U.K.
Dr Rebecca Natrajan SFHEA ……………………………………………………………………………………17
Factors Influencing Customer’s Trust in Online Shopping in Selangor, Malaysia
Sunny Omenazu ……………………………………………………………….………23
Social media and small business in the U.K. The case of Bournemouth
Firend Al. R, PhD, Shedrack I. Sedrack ……………………………………………………… 33
Cash flow and corporate financial performance of listed conglomerate companies in Nigeria
Aminatu Sani Mohammed …………………………………………………………………………42
Explicating the Nexus in perceived organizational support, career development and academic staff
intention to stay in Nigerian Universities context: A mediating approach
Ismaheel Adewumi Raji, Nasiru Abdullahi, Ismail Iyanda Abdussalaam, Sharafadeen Iyanda Ganiyu ………52
The Impact of COVID-19 on Myanmar Travel and related businesses
Soe Myint Than, Aye Aye Nyein, Shein Min Thu, Latt Pwint, Phyo Yin Win, Phyo Thinzar Thant, Than Yaw Zin, Snow, Aye Aye
Sint, Nay Shin Thant, Zin Mar, Pyae Pyae, Ayemy Ko Ko, Nilar Moe, Ni Ni Aye …..……………..………… 64
Perceived Organizational Support, Job Satisfaction and Turnover Intention: Does Organizational
Commitment Matter in the Development Context?
Ismaheel Adewumi Raji, Idris Bashir Bugaje, Suleiman Usman, Muhammed Kudu Aliyu, Abu Mohammed Ardo
……………………………………………. 69
An analysis of student engagement and personal well-being among business management students:
A study of a premier business school in India
Singh, Kavita & Dey, Soma ..…………………………………………………………82
Antecedents and consequences of organizational gendering
Meredith Downesa, Alex J. Barelkab
a bIllinois State University, MQM Department, Normal IL 61790-5580, U.S.A
Abstract
This paper centers on organizational gendering, assessing the effects of old boys’ networks, women’s networking and risk-taking
behaviors on gendering, as well as the impact that gendering has on turnover intentions. Several theories are invoked to explain
these relationships, as well as the mediating effect of organizational commitment on the relationship between gendering and
turnover intentions. Electronic surveys were administered to members of a women’s alumni center of a well-known university in
the northeastern United States. The survey was intended to ascertain the respondents’ perceptions of a variety of organizational
and career-related issues. Perceived obstacles associated with old boys’ networks enhance perceptions of gendering, and women’s
risk-taking behaviors reduce these perceptions. However, women’s networking exacerbates perceptions of gendering. In addition,
gender perceptions increase turnover intentions, and this relationship is stronger through organizational commitment, and as a
result commitment mediates this relationship.
Keywords: Organizational Gendering; Old Boys’ Network; Networking; Risk-Taking; Turnover Intent; Organizational Commitment
1. Introduction
Gender can be debilitating to women’s careers (Ortiz‐Walters et al., 2010; Schruijer, 2006), particularly as it is socially
constructed throughout society and its microcosms and manifested in perceptions of glass ceilings, glass cliffs, and
other barriers to success. As a result, females continue to perceive gender inequality and discrimination in the
workplace significantly more than do their male counterparts (Florentine, 2017; Parker, 2017). A 2016 survey
conducted jointly by InHerSight and Kununu found women to be less satisfied than men when it came to the overall
female-friendliness of their companies’ policies and practices. Women believe they have less opportunities for
promotions and salary increases than men, whereas men see little differences in opportunities across gender.
Evidence from the Pew Research Center shows that women employed in majority-male workplaces are much more
likely to perceive gender discrimination (Parker, 2017). An imbalance of male and female representation tends to
gender an organization, whereby the organizational culture takes on many of the stereotypical traits of the majority. As
such, male-gendered cultures favor ambition, the acquisition of wealth, and differentiated gender roles, all of which
have traditionally typified men in society. Since men have been participating in the workforce far longer than women,
organizations have predominantly developed masculine cultures rather than valuing the contributions of those who fit
the more traditional female stereotypes. In fact, Kalaitzi et al. (2017) identified organizational culture as a prevailing
barrier to women’s advancement, citing stereotypes about organizational resistance to women in top leadership
positions.
While the demographic make-up of an organization can influence perceptions about who and what is valued (Kartolo
and Kwantes, 2019), organizations which actively recruit women find themselves with more female representation in
management (Ng and Sears, 2017), and so it is possible to shift the balance and thus the culture. In that vein, this study
centers around perceptions of gendering, using organizational culture as the focal point. Under the premise that
gendering is socially constructed, it is through the female lens that gendered organizations become salient to a variety
of individual and organizational outcomes.
A review of the gendering literature suggests that gendering has an indirect effect on turnover intentions, as mediated
by organizational commitment. We therefore address this mediating effect, as compared to the direct effect of
gendering on turnover intentions, to determine whether mediation is the stronger of the two. In addition, to more fully
understand the role of organizational gendering, we have identified old boys’ networks and women’s networking and
risk-taking behaviors as potential antecedents to perceptions of gendering. Our literature review addresses these
antecedents of gendering perceptions, and then turnover intentions as a consequence, along with the mediating effect
of organizational commitment (see Figure 1). We then present empirical results, address their theoretical and practical
contributions, and make suggestions for future research on organizational gendering.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
7
Figure 1. Hypothesized Model
2. Background and Hypotheses
2.1 Organizational Gendering
Gendering is not a new area of study, having been developed in the 1960s as a way for women’s rights proponents to
increase the visibility of women’s experiences across a variety of realms. Distinct from the physiology of sex, gender
is socially constructed. Gendering begins at childhood, through interaction with others, such as parents, teachers, and
peers, whereby boys and girls are often treated differently. They often play separately on the playground, with boys
tending to play rules-based, competitive games, and girls playing more cooperatively. As a result, children develop
gendered identities that carry over into adulthood, reproducing the values, attitudes, and behaviors that are deemed
appropriate for that identity (Sociology of Gender). Based on societal expectations of gender appropriateness for adults,
women should display communal (nurturing, interpersonally sensitive) qualities and men should display agentic
(independent, assertive and ambitious) qualities (Wood and Lindorff, 2001).
The fact that women and men are socialized to be different represents a gendered social order, and it is deeply rooted
in many aspects of life in Western societies. It made its way into the organizational consciousness in 1990 when Joan
Acker coined “gendered organizations”, to capture the advantage, exploitation and control that distinguishes males
from females in the work environment. Hartmann, (1976) added patriarchy to the concept of organizational gendering,
asserting that women are subordinated in the workplace in a number of ways, including being disadvantaged upon entry,
and that men act to maintain that subordination while protecting their own privileges. It is therefore not surprising that
a dominant theme in the literature is that bureaucratic organizations are inherently gendered masculine (Britton, 2000).
Most studies on organizational gendering have investigated the ways in which industries (Ringblom and Johansson,
2020; Saifuddin et al., 2019), as well as occupations and jobs (Symeonaki and Filopoulou, 2017), are gendered. Other
attempts to understand gendering have been framed within the organizational culture paradigm (Mills, 2005).
According to Acker (1990), it is a mistake to think of any institution (including culture) as gender free. As a result,
company policies, management behavior and the like can be gendered. Specifically, what we see in organizations is
that men generally hold more instrumental attitudes, whereas women hold more altruistic and socially conscious
attitudes (Ng and Sears, 2010), each of which further shape organizational culture.
The organizational gendering process occurs through interpersonal interactions between and among men and women.
However, there appears to be limited research on what precipitates those interactions and hence gendering.
Contemporary practices, such as flattened hierarchies, team-based approaches, and telecommuting, seem to affect
organizational gendering to some degree (Conrad et al., 2010), but the persistence of old boys’ networks appears to
best mirror the social construction of gendering in early life. This is particularly evident in the way that boys play
competitive games among themselves and typically erect borders to defend against female intruders. These parallels
are supported through several aspects of social networking theory, as described below.
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
8
2.2 Old Boys’ Networks and Organizational Gendering
Networks can be thought of as the relationships that create a system of information, contact, and support (Whiting and
de Janasz, 2004). Their presence can help individuals understand the political and cultural aspects of an organization
(Ibarra and Andrews, 1993), and can provide a source of social capital (Molloy, 2005) and power (Perriton, 2006)
through increased exposure to others. Networks have been shown to affect career success, with research linking them
to increased salary, promotions, and career satisfaction (Seibert et al., 2001). Networks can be formal or informal, with
most research focusing on the informal types, which are not officially recognized by the organization (McGuire, 2000),
include members with common interests, and often used to socialize with colleagues. Whether formal or informal,
networks are characterized in terms of nodes (individual actors, people, or things within the network) and the ties or
edges (relationships or interactions) that connect them.
Research shows that networking is important for both men and women (Metz and Tharenou, 2001), although there are
basic differences in the structures of men’s and women’s networks. Men’s (or old boys’) networks tend to be larger,
with weaker ties and greater membership diversity (Ibarra, 1997). They also tend to be highly embedded, composed
of actors who show preference for transacting with other actors inside rather than outside the network (Granovetter,
1985; Uzzi, 1996). Finally, men have proportionately more formal networks than women do, but it is men’s informal
networks that are the more fully developed. Given that many conversations occur in traditionally male-dominated
environments, networks of friendships and connections help men to use their positions of influence by providing favors
and information to help other men. As such, these networks also tend to provide instrumental benefits, including
advancement (Forret and Dougherty, 2004).
Using the social constructionist perspective (Ely, 1995), it can be argued that old boys’ networks contribute to
organizational male gendering. The socialization that takes place through these informal interactions solidifies one’s
place as part of an in-group. Even when women may not be officially excluded from these venues, early socialization
results in less perceived extra-organizational time to participate, in which case male dominated networks can be
perceived as obstacles to women’s careers. It is therefore expected that the perception of the obstacles created by old
boys’ networks play an important role in the social construction of a male-gendered organizational culture.
H1: The perception of old boys’ networks as an obstacle to career success will increase perceptions of organizational
gendering.
2.2 Women’s Networking and Organizational Gendering
2.3
As pervasive as gender is, it is constructed and maintained through daily interaction and therefore can be resisted
(Lorber, 2000). In fact, research suggests that women who do their own networking perceive less male gendering in
their organizations. Further, a meta-analysis has shown that social capital, which is comprised of the quantity of people
an employee knows in other functions or at higher levels (e.g. Seibert et al., 2001) and the extent to which an employee
engages in networking activities (e.g. Igbaria et al., 1994; Ng et al., 2005), have the largest positive impacts on
promotion.
While networking can be beneficial across genders, research shows that men and women engage in networking
activities for different reasons, with men networking in order to promote their careers, and women doing so for the
purpose of social support (Ibarra, 1992) or to increase their agency (Biese and Choroszewicz, 2019). However,
networking can also have a positive effect on women’s careers (Forret and Dougherty, 2001), including accelerated
promotions (Sabatier & Carrère, 2015) and can increase their self-confidence and personal development (Stamm, 2010).
This leads to in an increase in their perceived ability to take on leading roles and pursue better job opportunities. Some
have speculated that these benefits are due to increased access to information, greater visibility, career advice, social
support, and business leads (Green, 1982). Therefore, we would expect that women who believe networking is
beneficial and therefore participate in networking activities will perceive significant career benefits and as a result, feel
less like their organizations are dominated by males and/or stereotypical masculine values.
H2: Women who view networking behaviors as helpful to their careers will perceive less organizational gendering
than those who do not.
2.4 Women’s Risk-Taking and Organizational Gendering
2020 The International Journal of Business and Management Research, Vol.13 Number 1
9
It is well-documented that women are adverse to risk, whereas men are typically more tolerant of it (Rolison and
Shenton, 2020) and even tend to view risky situations as opportunities. There continues to be a societal stereotype, with
such instrumental behaviors considered legitimate for men but not for women. As a class, then, women may not be
perceived as management material (Dunegan and Duchon, 1989). However, women who engage in risk-taking
behavior take on characteristics displayed primarily by males and thus improve person-environment fit in organizations
that are male-gendered.
Further, according to Cooper-Thomas et al., (2014), proactive behaviors have benefits beyond their immediate scope,
whether intended or not. For example, in the absence of strong networks of relationships, trusting others in the
organization is a risk-taking behavior. Even if the system and policies are primarily by and for men in the organization,
displays of trust are stereotypically masculine and also improve person-environment fit, therefore precluding any sense
that the organization is gendered against them.
H3: Women who view risk-taking behaviors as helpful to their careers will perceive less organizational gendering than
those who do not.
2.5 Organizational Gendering and Turnover Intent
Turnover is the culmination of an employee’s intentions to leave the organization and continues to receive attention in
the OB literature for good reason. The costs of turnover are both direct and indirect, disrupting operations in a number
of ways. These include the selection, recruitment, and training of new employees (Staw, 1980), as well as reduced
morale, loss of social capital, and an increased workload for those that remain (Dess and Shaw, 2001). Given that more
than 38 percent of all turnover in 2018 was attributable to employees who quit in the first year (Work Institute, 2019),
research continues to address what drives turnover intentions, with several studies suggesting that organizational
gendering in one form or another plays an important role, particularly for females.
According to Tiwari et al. (2019), females are likely to develop intentions to quit when their organizations are male
dominated, with cultures are characterized by biases that increase the glass ceiling. In studying the job attitudes of
accountants, Baird et al. (1998) reported that women may be just as committed to their careers but are more likely to
leave for better opportunities elsewhere. Reasons cited by women were solely related to affective measures such as
how much they liked their jobs and tasks and whether they felt that they were part of their organizations. Men, on the
other hand, expressed intentions to leave for additional reasons such as economic factors.
Evidence from other research, though not gender-specific, connects turnover intentions to many of the issues found in
gendered organizations. In a study of medical representatives working in Pakistan, Nazim and Shahid, (2012) found
turnover intentions to be significantly impacted by both distributive and procedural justice perceptions, attitudes which
are often addressed in the glass ceiling literature. Turnover intentions have also been empirically and significantly
linked to a lack of opportunities to participate and make influential decisions (Kuean et al., 2010). In addition, increased
effort leads to turnover intent (Kuean et al., 2010), as it increases perceptions of inequity. Finally, intentions to leave
are reduced when employees accept company values (Wright and McMahan, 1992), although this will be less likely
when cultures are gendered and values are not shared.
Powell and Butterfield (2015) invoked several existing theories of gender discrimination to demonstrate the effect of
organizational gendering on promotions to top management positions, including theories of patriarchy (e.g. Marshall,
1984; Strober, 1984) and rational bias theory (Larwood et al., 1988), both of which are helpful in explaining how
gendering might affect turnover intentions as well. Patriarchy, for example, marginalizes women as decision-makers,
and the literature reviewed in this section suggests that this will increase turnover intentions as well. Rational bias
theory explains why men in the organization perpetuate gender discrimination as long as they believe their
organizations are not interested in eliminating it. This creates perceptions of bias and injustice, which the literature
associates with turnover intentions.
H4: Women’s perceptions of organizational gendering will be positively related to their intentions to leave.
2.6 Gendering and Turnover Intent: Organizational Commitment as Mediator
Just as turnover intent is among the strongest predictors of actual turnover, organizational commitment is one of the
leading drivers of turnover intentions. The link is well-established in the literature (Allen and Meyer, 1990; Van Dyk
and Coetzee, 2012; Guzeller and Celiker, 2019; Taing et al., 2011). Although studies have argued that the different
commitment dimensions (affective, continuance, and normative) interact to create distinct profiles of commitment
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
10
which may bear on outcomes (e.g Meyer et al., 2013; So et al., 2016; Stanley et al., 2013), all three dimensions are
theorized to have an adverse relationship to turnover intentions (Meyer and Herscovitch, 2001). In fact, Stanley et al.,
(2013) argue that internal drivers (such as affective commitment) are closely related to employees voluntarily leaving
their organizations.
While the previous section suggests that organizational gendering leads to turnover intentions, there is perhaps more
evidence to suggest that gendering reduces commitment which then impacts turnover intentions, and commitment has
been found to differ by gender (Kulesa et al., 2005; Voloshin, 2016). Commitment among males has been linked to
leadership practices, rewards, and company image. Achievement orientation, more typical among males than females,
creates a perception that ongoing commitment will lead to career advancement. Commitment among females has been
linked to empowerment, development opportunities, work-life balance (Kulesa et al., 2005) and just-world beliefs
(Jones, 2002).
Organizational gendering can potentially reduce commitment for a number of reasons, depending on how that
gendering is displayed. For instance, according to the theory on Perceived Insider Status, when an organization offers
different inducements to different groups (Hipple, 1998) who contribute equally, employees may either see themselves
as part of the well-treated group or the one that is marginalized. As this inducement-contribution cycle continues, it
creates a pattern of differential treatment, resulting in perceptions that some employees are more valuable (i.e. insiders)
and that others are expendable (i.e. outsiders). Human Capital Theory (Becker, 2009) suggests that organizations tend
to invest in employees who they expect will provide returns to the organization. The support, as it is perceived, is
another signal regarding insider or outsider status. When organizations are in fact male-gendered, men are perceived
as insiders and women are perceived as outsiders. Additionally, Lind and Tyler (1988) suggest that perceived justice
is important to commitment because of the belief that the organization cares about employee well-being.
In a study of accounting employees (Baird, 1996), men and women were equally likely to leave their jobs, but their
intentions to do so were motivated by different factors. While organizational commitment (and affective commitment
in particular) was the sole predictor among women, men were additionally motivated by economic factors. More
recently, Tiwari et al. (2019) found a strong relationship between organizational commitment and turnover intentions
among a sample of women, with glass ceiling perceptions as a strong predictor of commitment. Based on this, together
with the discussion above, we have reason to believe that it is through commitment to the organization that gendering
leads to turnover intentions.
H5: Affective organizational commitment will mediate the relationship between organizational gendering and
intentions to leave.
3. Methods
3.1 Data Collection
Electronic surveys were administered to members of a women’s alumni center of a well-known university in the
northeastern United States. The survey was intended to ascertain the respondents’ perceptions of a variety of
organizational and career-related issues. 399 completed surveys were submitted directly to the researchers, who ensured
their confidentiality. Sample demographics are shown in Table I.
Table 1. Sample Demographics (as percentage of total sample)
Current Position
Age
Marital Status
Org Tenure (yrs)
Education
Clerical
1.2
>25
13.5
Single, no dependents
38.9
3 or less
45.2
Bachelors
49.0
Staff
9.5
26-30
18.0
Single with dependents
4.0
4-6
26.0
Master
49.5
Professional
33.1
31-35
12.3
Married, no dependents
19.2
7-10
11.8
Doctorate
1.5
Supervisor
8.0
36-40
12.3
Married with dependents
37.2
11-15
11.0
Mid.Manager
27.6
41-45
13.3
16-20
6.0
Executive
14.8
46-50
14.0
No Answer
5.8
51-55
11.3
56 +
5.3
2020 The International Journal of Business and Management Research, Vol.13 Number 1
11
3.2 Measures
3.21 Old Boys’ Network
This three-item measure was based on items from Afza and Newaz (2008) and Tran (2014) that asked respondents to
rate the extent to which they perceived such networks to be obstacles to women’s careers. The items addressed
corporate structure and practices that favor male employees, as well as male domination of senior positions. Responses
were given on a 5-point Likert scale from “not an obstacle” to “high obstacle”. Cronbach’s Alpha for this measure was
0.85.
3.22 Organizational Gendering
This four-item measure was taken from Jawahar and Hemmasi (2006) and asked respondents to indicate their agreement
to statements about whether women are respected equally in their organizations and whether there are equal career
development opportunities for men and women. Responses were given on a 5-point Likert scale from “Strongly
Disagree” to “Strongly Agree”. Cronbach’s Alpha for this measure was 0.89.
3.33 Women’s Networkin
This three-item measure was also based on items from Afza and Newaz (2008) and asked respondents to rate how
helpful they believed certain activities were to women’s advancement in general. These included spending time (e.g.,
socializing) in the workplace with superiors and influential individuals, as well as socializing with superiors and
influential individuals outside of the workplace. Responses were again given on a 5-point Likert scale from “not helpful”
to “greatly helpful”. Cronbach’s Alpha for this measure was 0.73
3.34 Risk-Taking
This three-item measure was based on items from Afza and Newaz (2008) and asked respondents to rate how helpful
they believed certain characteristics were to women’s advancement in general. These included the willingness to take
business risks, expressing interest in high-stake, challenging and visible assignments, being entrepreneurial, and taking
initiative. Responses were given on a 5-point Likert scale from “not helpful” to “greatly helpful”. Cronbach’s Alpha
for this measure was 0.79
3.35 Affective Organizational Commitmen
This four-item measure came from Allen and Meyer (1990) and asked respondents to indicate their level of agreement
with statements regarding their sense of belonging to their organizations and their emotional attachment to their
organizations. Responses were given on a 5-point Likert scale from “Strongly Disagree” to “Strongly Agree”.
Cronbach’s Alpha for this measure was 0.86
3.36 Turnover Intent
This four item measure came from the Michigan Organizational Assessment Questionnaire (Cammann, 1983) and
asked respondents to indicate their level of agreement with statements about whether they would leave their current
employer if given the choice and how often they think about doing so. Responses were given on a 5-point Likert scale
from “Strongly Disagree” to “Strongly Agree”. Cronbach’s Alpha for this measure was 0.95.
4. Results
Confirmatory Factor Analysis (CFA) was performed using AMOS and indicated that the six-factor model provided a
good fit to the data, .90; CFI = 0.97; TLI = 0.96; RMSEA = 0.05. Table II provides the means, standard deviations,
and correlations among the variables.
Table 2. Means, Standard Deviations, and Correlations
Mean
St Dev
Old Boys’
Network
Gendering
Networking
Risk- Taking
Org Commit
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
12
Old Boys’ Network
3.78
1.01
Org Gendering
2.68
.97
.52*
Networking
3.53
.90
.24*
.27*
Risk-Taking
3.97
.78
-.08
-.29*
.22*
Org Commit
3.38
.92
-.19*
-.50*
-.13*
.27*
Turnover
2.62
1.17
.24*
.58*
.22*
-.25*
-.73*
P<.05** n=399
4.1 Direct Effects
Hypotheses 1, 2 and 3 were tested using multiple regression. As shown in Table III, the results of the regression
indicated that the three predictors explained a significant amount of the variance (R2=.38, F(3,395)=79.88, p<.05).
Hypothesis1 suggested a positive relationship between a participant’s perceptions that old boys’ networks will act as
an obstacle to career success and the degree to which they consider their organization to be male-gendered. The beta
coefficient for OBN is positive and significant ( =.43, p<.05). Therefore, H1 is supported.
Hypothesis 2 suggested a negative relationship between a participant’s perceptions that women’s networking behavior
will be helpful to their careers and the degree to which they consider their organization to be male-gendered. However,
the beta coefficient for networking is positive and significant ( =.24, p<.05). Therefore, H2 is not supported.
Hypothesis 3 also suggested a negative relationship between a participant’s perceptions that risk-taking will enhance
career success and the degree to which they consider their organizations to be male-gendered. The beta coefficient for
Risk-taking is negative and significant ( =-.37, p<.05). Therefore, H3 is supported.
H4 was tested using the bivariate correlations shown in Table 2. The relationship between women’s perceptions of
organizational gendering and intentions to leave is significant and positive (r = .58, p <.05). As a result, H4 is supported.
Table 3. Regression Results
Model
B
SE B
p (sig)
OBN
0.43
0.04
0.44
0.00
Networking
0.24
0.05
0.23
0.00
Risk-taking
-0.37
0.05
-0.30
0.00
R2
0.38
4.2 Mediation effects
H5 was tested using the bootstrapping procedures described by Hayes and Scharkow (2013). For this we conducted a
mediation analysis with the PROCESS macro (Model 4; 5000 bootstrapped samples) to test the mediation effects of
organizational commitment on the relationship between perceptions of organizational gendering and turnover intentions.
The direct path from perceptions of gendering and organizational commitment was negative and statistically significant
(b=-.47, p<.05). In addition, the direct path from gendering and to turnover intentions was positive and statistically
significant (b=.35, p<.05), and the direct path from commitment to turnover intentions was also negative and
statistically significant (b=-.75, p<.05). The indirect effect was tested using non-parametric bootstrapping. In this case
the Indirect Effect (IE) was positive (IE=.35) and statistically significant: 95% CI = (.28, .44). Therefore, H5 is
supported.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
13
5. Discussion
This paper provides insight on organizational gendering, explaining why it persists, what it means for organizational
outcomes, and how it can be decreased. Four of the five hypotheses were supported, confirming expectations that
perceived obstacles associated with old boys’ networks enhance perceptions of organizational gendering, and that the
perceived benefits associated with risk-taking reduce perception of gendering. However, counter to expectations,
women who believed networking helps their careers actually perceived gendering to a greater degree. Expectations
about the consequences of gender perceptions were confirmed, with results showing that gender perceptions indeed
increase turnover intentions, and that this relationship is even stronger through organizational commitment than without
it and as a result commitment mediates this relationship.
While beliefs in the power of risk-taking are manifested in lower perceptions of gendering, the opposite is true for the
belief in the power of networking, and these seemingly contradictory findings deserve attention. With the effect of
risk-taking in the expected negative direction, we find that women who believe in risk-taking do not perceive their
organizations as particularly male-gendered. This is consistent with our theoretical arguments that risk-taking, as a
stereotypical masculine behavior, helps level the playing field since both women and men are then displaying similar
traits. It also improves person-environment fit for women who now exhibit the traits that are more accepted and
rewarded in male-gendered organizations. The effect of women’s networking on perceptions of gendering was also
significant but not in the anticipated negative direction. As a result, women who believe that networking will help their
careers perceive more gendering, perhaps due to the limited opportunities that women have to network in the first
place. Women are often excluded from social events and workplace interactions in which men engage (McCarthy,
2004). They disproportionality face several situational and social barriers that may discourage them from participating
(Tonge, 2008), given that networking is often conducted after work hours and may conflict with family
responsibilities. As such, women may not benefit from networking to the same extent as their male counterparts (Ibarra,
1992). In fact, efforts expended toward networking may underscore the barriers that they face and only strengthen their
perceptions of gendering.
5.1 Theoretical Implications
While studies on gendering in organizations date back 30 years, most have used jobs or occupations as the unit of
analysis, with very few considering the gender of organizational culture (Britton, 1997). Organizations are often
microcosms of their national cultures, and since masculine/feminine cultures exist at the national level (Hofstede, 1980),
it makes sense that organizational cultures will feed off the same stereotypes. In addition, this study adopts a social
constructionist perspective to assessing gendering, suggesting networking and risk-taking as a means to reduce those
perceptions. Finally, both antecedents and consequences are addressed here, making gendering the true focal point of
the investigation. The paper is comprehensive in its literature review of the effects on gendering and, in turn, the direct
effects of gendering on other outcomes, and includes moderating and mediating variables.
5.2 Practical Implications
Organizational cultures tend to support those who fit with their values, norms and behaviors, and when women perceive
male gendering, they may leave for other opportunities or even start businesses of their own. If they stay, neither the
female employees nor their organizations benefit in such an environment. As shown in the literature review and
supported in this study, both the employees and their organizations play a crucial in creating and managing these
perceptions. Organizations that perpetuate old boys’ networks, where members share bonds that extend beyond work
and where the unwritten rules define the insiders and outsiders, will begin to lose female employees, whether in
physicality or in spirit. This is particularly true when women join the workforce with predispositions regarding the
obstacles presented by old boys’ networks. The prevailing view of leadership should perhaps shift from conventional
displays of confidence (e.g. swagger, firm handshakes, boastfulness) to recognize those whose gendered upbringings
discourage those behaviors. Organizations can incentivize diverse perspectives and perhaps balance gender
representation in leadership roles. Meanwhile, women can take action as well to lessen their perceptions of gendering,
in which case organizations should consider orientations and development programs that encourage and incentivize
them to take risks which allow them to reconstruct their organization’s gendered social order. Organizations might
therefore be wise to promote female risk-taking behaviors in order to neutralize the male/female differences with
respect to person-environment fit and thus reduce perceptions of gendering that can ultimately lead to an exodus of
female employees.
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
14
5.3 Limitations and Future Directions
To our knowledge, this study is the first to address organizational gendering within the cultural paradigm since the
emergence of the “Me Too” movement is therefore particularly timely. However, it does come with some limitations.
For example, it is commonly thought that studies with single sources of data are less robust as those using multiple
sources, and this be especially true for subjective data. In addition, data were collected from women who are all
members of the same university association in the northeast United States. As a result, generalizability to other female
populations may be limited. Future studies may address this with matched samples from other university centers as
well as within and across organizations. In addition, it might be interesting to compare findings across male and female
respondents, since they tend to differ on an overall basis when it comes to perceptions of gendering. Another avenue
of inquiry might be whether gendering perceptions are more prevalent in masculine societies, as well as whether
national culture characteristics such as masculinity/femininity are mirrored by the perceptions held by local nationals.
References
Acker, J. (1990), “Hierarchies, jobs, bodies: A theory of gendered organizations”, Gender & Society, Sage Publications, Vol. 4 No. 2, pp. 139–158.
Afza, S.R. and Newaz, M.K. (2008), “Factors Determining the Presence of Glass Ceiling and Influencing Women Career Advancement in
Bangladesh”, BRAC University Journal, Vol. 5 No. 1, pp. 85–92.
Allen, N.J. and Meyer, J.P. (1990), “The measurement and antecedents of affective, continuance and normative commitment to the organization”,
Journal of Occupational Psychology, Wiley Online Library, Vol. 63 No. 1, pp. 1–18.
Becker, G.S. (2009), Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education, University of Chicago Press.
Biese, I. and Choroszewicz, M. (2019), “Opting out: professional women develop reflexive agency”, Equality, Diversity and Inclusion, Vol. 38
No. 6, pp. 619–633.
Britton, D.M. (1997), “Gendered organizational logic: Policy and practice in men’s and women’s prisons”, Gender & Society, SAGE Periodicals
Press, Vol. 11 No. 6, pp. 796–818.
Britton, D.M. (2000), “Feminism in criminology: Engendering the outlaw”, The Annals of the American Academy of Political and Social Science,
Sage Publications Sage CA: Thousand Oaks, CA, Vol. 571 No. 1, pp. 57–76.
Cammann, C. (1983), “Assessing the attitudes and perceptions of organizational members”, in Lawler, E.E., Mirvis, P.H., Cammann, C. and
Seashore, S. (Eds.), Assessing Organizational Change: A Guide to Methods, Measures, and Practices, John Wiley & Sons Inc, New York,
NY, pp. 71–138.
Conrad, P., Carr, P., Knight, S., Renfrew, M.R., Dunn, M.B. and Pololi, L. (2010), “Hierarchy as a barrier to advancement for women in academic
medicine”, Journal of Women’s Health, Vol. 19 No. 4, pp. 799–805.
Cooper-Thomas, H.D., Paterson, N.L., Stadler, M.J. and Saks, A.M. (2014), “The relative importance of proactive behaviors and outcomes for
predicting newcomer learning, well-being, and work engagement”, Journal of Vocational Behavior, Elsevier, Vol. 84 No. 3, pp. 318–331.
Dess, G.G. and Shaw, J.D. (2001), “Voluntary turnover, social capital, and organizational performance”, Academy of Management Review, Vol. 26
No. 3, pp. 446–456.
Dunegan, K.J. and Duchon, D. (1989), “Gender, task complexity and risk taking: Catch 22 for women”, American Journal of Business, MCB UP
Ltd, Vol. 4 No. 1, pp. 23–32.
Van Dyk, J. and Coetzee, M. (2012), “Retention factors in relation to organisational commitment in medical and information technology services”,
SA Journal of Human Resource Management, Sabinet, Vol. 10 No. 2, pp. 1–11.
Ely, R.J. (1995), “The power in demography: Women’s social constructions of gender identity at work”, Academy of Management Journal, Vol.
38 No. 3, pp. 589–634.
Florentine, S. (2017), “How workplace equality perceptions are shaped by gender”, available at: https://www.cio.com/article/3155947/how-
workplace-equality-perceptions-are-shaped-by-gender.html.
Forret, M.L. and Dougherty, T.W. (2001), “Correlates of networking behavior for managerial and professional employees”, Group & Organization
Management, Vol. 26 No. 3, pp. 283–311.
Forret, M.L. and Dougherty, T.W. (2004), “Networking behaviors and career outcomes: differences for men and women?”, Journal of
Organizational Behavior: The International Journal of Industrial, Occupational and Organizational Psychology and Behavior, Vol. 25 No.
3, pp. 419–437.
Granovetter, M. (1985), “Economic action and social structure: The problem of embeddedness”, American Journal of Sociology, Vol. 91 No. 3, pp.
481–510.
Green, M. (1982), “A Washington perspective on women and networking: the power and the pitfalls”, Journal of the NAWDAC, Vol. 43 No. 1, pp.
17–21.
Guzeller, C.O. and Celiker, N. (2019), “Examining the relationship between organizational commitment and turnover intention via a meta-
analysis”, International Journal of Culture, Tourism and Hospitality Research, Vol. 14 No. 1, pp. 102–120.
Hartmann, H. (1976), “Capitalism, patriarchy, and job segregation by sex”, Signs: Journal of Women in Culture and Society, Vol. 1 No. 3, Part 2,
pp. 137–169.
Hayes, A.F. and Scharkow, M. (2013), “The relative trustworthiness of inferential tests of the indirect effect in statistical mediation analysis: Does
method really matter?”, Psychological Science, Vol. 24 No. 10, pp. 1918–1927.
Hipple, S. (1998), “Contingent work: results from the second survey”, Monthly Labor Review, Vol. 121, pp. 22–35.
Hofstede, G. (1980), Culture’s Consequences: International Differences in Work-Related Values, Sage, Beverly Hills, CA.
Ibarra, H. (1992), “Homophily and differential returns: Sex differences in network structure and access in an advertising firm”, Administrative
Science Quarterly, pp. 422–447.
Ibarra, H. (1997), “Paving an alternative route: Gender differences in managerial networks”, Social Psychology Quarterly, JSTOR, pp. 91–102.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
15
Ibarra, H. and Andrews, S.B. (1993), “Power, social influence, and sense making: Effects of network centrality and proximity on employee
perceptions”, Administrative Science Quarterly, pp. 277–303.
Igbaria, M., Parasuraman, S. and Badawy, M.K. (1994), “Work experiences, job involvement, and quality of work life among information systems
personnel”, MIS Quarterly, pp. 175–201.
Jawahar, I.M. and Hemmasi, P. (2006), “Perceived organizational support for women’s advancement and turnover intentions”, Women in
Management Review, Vol. 21 No. 8, pp. 643–661.
Jones, O.D. (2002), Target Model of Glass Ceiling Phenomena., Dissertation Abstracts International: Section B: The Sciences and Engineering,
Saint Louis University.
Kalaitzi, S., Czabanowska, K., Fowler-Davis, S. and Brand, H. (2017), “Women leadership barriers in healthcare, academia and business”,
Equality, Diversity and Inclusion, Vol. 36 No. 5, pp. 457–474.
Kartolo, A.B. and Kwantes, C.T. (2019), “Organizational culture, perceived societal and organizational discrimination”, Equality, Diversity and
Inclusion, Vol. 38 No. 6, pp. 602–618.
Kuean, W.L., Kaur, S. and Wong, E.S.K. (2010), “The relationship between organizational commitment and intention to quit: The Malaysian
companies perspectives”, Journal of Applied Sciences(Faisalabad), Vol. 10 No. 19, pp. 2251–2260.
Kulesa, P., Masson, R. and Simonds, K. (2005), “Predictors of organizational commitment by gender and management level”, Annual Meeting of
the American Sociological Association, Philadelphia.
Larwood, L., Szwajkowski, E. and Rose, S. (1988), “Sex and race discrimination resulting from manager-client relationships: Applying the rational
bias theory of managerial discrimination”, Sex Roles, Vol. 18 No. 1–2, pp. 9–29.
Lind, E.A. and Tyler, T.R. (1988), “Procedural Justice in Organizations”, The Social Psychology of Procedural Justice, Springer, Boston, MA, pp.
173–202.
Lorber, J. (2000), “Using gender to undo gender: A feminist degendering movement”, Feminist Theory, Vol. 1 No. 1, pp. 79–95.
Marshall, J. (1984), “Women in Management”, Management Education and Development, Vol. 15 No. 2, pp. 121–131.
McCarthy, H. (2004), Girlfriends in High Places: How Women’s Networks Are Changing the Workplace, Demos.
McGuire, G.M. (2000), “Gender, race, ethnicity, and networks: The factors affecting the status of employees’ network members”, Work and
Occupations, Vol. 27 No. 4, pp. 501–524.
Metz, I. and Tharenou, P. (2001), “Women’s Career Advancement: The relative contribution of human and social capital”, Group and
Organization Management, Vol. 26 No. 3, pp. 312–342.
Meyer, J.P. and Herscovitch, L. (2001), “Commitment in the workplace: Toward a general model”, Human Resource Management Review, Vol. 11
No. 3, pp. 299–326.
Meyer, J.P., Stanley, L.J. and Vandenberg, R.J. (2013), “A person-centered approach to the study of commitment”, Human Resource Management
Review, Elsevier, Vol. 23 No. 2, pp. 190–202.
Mills, J.H. (2005), “Organizational change and representations of women in a North American utility company”, Gender, Work & Organization,
Vol. 12 No. 3, pp. 242–269.
Molloy, J.C. (2005), “Development networks: Literature review and future research”, Career Development International, Vol. 10, pp. 536–547.
Nazim, A. and Shahid, J. (2012), “Relationship between organizational justice and organizational commitment and turnover intentions amongst
medical representatives of pharmaceuticals companies of Pakistan”, Journal of Managerial Sciences, Vol. 6 No. 2, pp. 202–2012.
Ng, E.S. and Sears, G.J. (2017), “The glass ceiling in context: the influence of CEO gender, recruitment practices and firm internationalisation on
the representation of women in management”, Human Resource Management Journal, Vol. 27 No. 1, pp. 133–151.
Ng, E.S.W. and Sears, G.J. (2010), “What women and ethnic minorities want. Work values and labor market confidence: A self-determination
perspective”, International Journal of Human Resource Management, Vol. 51 No. 5, pp. 678–698.
Ng, T.W.H., Eby, L.T., Sorensen, K.L. and Feldman, D.C. (2005), “Predictors of objective and subjective career success: A meta‐analysis”,
Personnel Psychology, Vol. 58 No. 2, pp. 367–408.
Ortiz‐Walters, R., Eddleston, K. and Simione, K. (2010), “Satisfaction with mentoring relationships: does gender identity matter?”, Career
Development International, Vol. 15 No. 2, pp. 100–102.
Parker, K. (2017), “Women in majority-male workplaces report higher rates of gender discrimination”, available at:
https://www.pewresearch.org/fact-tank/2018/03/07/women-in-majority-male-workplaces-report-higher-rates-of-gender-discrimination/.
Perriton, L. (2006), “Does woman+ a network= career progression?”, Leadership, Vol. 2 No. 1, pp. 101–113.
Powell, G.N. and Butterfield, D.A. (2015), “The glass ceiling: what have we learned 20 years on?”, Journal of Organizational Effectiveness:
People and Performance, Emerald Group Publishing Limited.
Ringblom, L. and Johansson, M. (2020), “Who needs to be ‘more equal’ and why? Doing gender equality in male-dominated industries”, Equality,
Diversity and Inclusion, Vol. 39 No. 4, pp. 337–353.
Rolison, J.J. and Shenton, J. (2020), “How much risk can you stomach? Individual differences in the tolerance of perceived risk across gender and
risk domain”, Journal of Behavioral Decision Making, Vol. 33 No. 1, pp. 63–85.
Saifuddin, S., Dyke, L. and Hossain, M.S. (2019), “Walls all around: barriers women professionals face in high-tech careers in Bangladesh”,
Equality, Diversity and Inclusion, Vol. 38 No. 7, pp. 705–726.
Schruijer, S.G.L. (2006), “Do women want to break the glass ceiling? A study of their career orientations and gender identity in the Netherlands”,
Management Revue, pp. 143–154.
Seibert, S.E., Kraimer, M.L. and Liden, R.C. (2001), “A social capital theory of career success”, Academy of Management Journal, Vol. 44 No. 2,
pp. 219–237.
So, K.K.F., King, C., Sparks, B.A. and Wang, Y. (2016), “Enhancing customer relationships with retail service brands: The role of customer
engagement”, Journal of Service Management, Vol. 27 No. 2, pp. 170–193.
Stamm, J. (2010), “Women in Science--Why Networking Matters”, European Review, Vol. 18 No. 2, p. 121.
Stanley, L., Vandenberghe, C., Vandenberg, R. and Bentein, K. (2013), “Commitment profiles and employee turnover”, Journal of Vocational
Behavior, Vol. 82 No. 3, pp. 176–187.
Staw, B.M. (1980), “The consequences of turnover”, Journal of Occupational Behaviour, pp. 253–273.
Strober, M.H. (1984), “Toward a general theory of occupational sex segregation: The case of public school teaching”, in Reskin, B.F. (Ed.), Sex
Segregation in the Workplace: Trends, Explanations, Remedies, National Academy Press, Washington, DC, pp. 144–156.
Symeonaki, M. and Filopoulou, C. (2017), “Quantifying gender distances in education, occupation and employment”, Equality, Diversity and
Inclusion, Vol. 36 No. 4, pp. 340–361.
Taing, M.U., Granger, B.P., Groff, K.W., Jackson, E.M. and Johnson, R.E. (2011), “The multidimensional nature of continuance commitment:
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
16
Commitment owing to economic exchanges versus lack of employment alternatives”, Journal of Business and Psychology, Vol. 26 No. 3,
pp. 269–284.
Tiwari, M., Mathur, G. and Awasthi, S. (2019), “A Study on the Effects of Glass Ceiling & Organizational Commitment on Corporate Women’s
Turnover Intentions”, Academy of Strategic Management Journal, Vol. 18 No. 2, pp. 1–10.
Tonge, J. (2008), “Barriers to networking for women in a UK professional service”, Gender in Management, Vol. 23 No. 7, pp. 484–505.
Tran, T. (2014), Identifying the Existence of the Glass Ceiling and Examining the Impact on the Participation of Female Executives in the
Vietnamese Banking Sector, Unitec Institute of Technology.
Uzzi, B. (1996), “The sources and consequences of embeddedness for the economic performance of organizations: The network effect”, American
Sociological Review, pp. 674–698.
Voloshin, G. (2016), Differences in Organizational Commitment between Male and Female Coaches at the High School Level, St. John Fisher
College.
Whiting, V.R. and de Janasz, S.C. (2004), “Mentoring in the 21st century: Using the internet to build skills and networks”, Journal of Management
Education, Vol. 28 No. 3, pp. 275–293.
Wood, G.J. and Lindorff, M. (2001), “Sex differences in explanations for career progress”, Women in Management Review, Vol. 16 No. 4, pp.
152–162.
Work Institute. (2019), “2019 Retention Report”, available at: https://info.workinstitute.com/hubfs/2019 Retention Report/Work Institute 2019
Retention Report final-1.pdf.
Wright, P.M. and McMahan, G.C. (1992), “Theoretical perspectives for strategic human resource management”, Journal of Management, Vol. 18
No. 2, pp. 295–320.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
17
Developing Female Intrapreneurship-A study about the role of
Female Entrepreneurs employed in the University Partnership
Programme in London, U.K.
Dr Rebecca Natrajan SFHEA
London, United Kingdom
Abstract
Female academics from a business background produce better results and appreciation than female academics who do not have a
business background. These female academics who demonstrated intrapreneurial characteristics were more celebrated for their
academic contributions by the students than the female academics who were from non-business background. Student’s feedback
revealed that female academics who own business may influence the results of entrepreneurship education and facilitate the
students learn from their direct commercial experience. By combining policy analysis with empirical data, the present qualitative
study explored two important issues: how female academics demonstrate intrapreneurial competencies which are influencing the
students’ achievements, and how to groom female academics with entrepreneurial exposure in the University partnership setting.
The findings indicated that the success patterns of female academics who were involved in business outside their university are
able to strengthen the entrepreneurial knowledge of the students than the female academics who came from a non-business
background.
Keywords: University Partnership programme, Female academics, Intrapreneurship Non-business background;
1. Introduction
Educational institution acquaint with policy makers introduces Entrepreneurship Education to stimulate the higher
education students and prepare them for employment and business opportunities. It is equally the responsibility of
higher education institution, to train the learners for commercial world where the cognitive thinking and proactive
way is a key driver of success (Audretsch 2014).Cognitive Entrepreneurship education should focus more on
developing the individual’s ability to turn their ideas in to opportunities as an entrepreneur or as an intrapreneur. The
mainstream universities can easily achieve this by allowing their academics to connect and collaborate with business
directly or indirectly. However, Universities partnership programmes recruit academics in their early research stage
or academics who are not connected with any business as their focus is teaching not on the research. This stifles the
university partnership programme students to increase the employability skills or the entrepreneurial abilities.
The recent feedback and the final results from the non-traditional students revealed that the female academics
connected with business provided better classroom experience than the female academics who hailed from non-
business background. So the author in this paper discusses about the challenges faced and opportunities available for
female academics from – business and non-business background. The author also provides an insight about how
female academics from business background have demonstrated intrapreneurial competencies within the institution
and also in the classroom. The following research objectives and questions explained the purpose of this research.
Research questions:
1) how female academics connected with the business background can demonstrate their intrapreneurial
competencies?
2) What are the challenges encountered by female academics from a non-business background in University
Partnership programme?
Research Objectives:
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
18
• To study the intrapreneurial competencies demonstrated by female academics connected with Business
• To examine the challenges faced by female academicians who are not connected with Business background.
• To provide recommendations to university partnership prgrammes about developing female intrapreneurship
•
1.1. Female academics and Entrepreneurship:
Entrepreneurship departments are emerging day by day within the higher education and further education scenario.
These departments play a crucial role in influencing and executing the entrepreneurial mindset among the staff and
the students for capacity building activities. (Audretsch, 2014). Such capacity building activity includes setting up a
University partnership programme with Private higher education institution. This opens the door or a platform for
international student’s especially non-traditional students. Entrepreneurial competencies cannot be taught whereas
entrepreneurship is a way of thinking (Leitch, Hazlett, and Pittaway 2012; Mustar 2009). To sustain these non-
traditional students who are returning to education after a long gap requires academics who are directly connected
with business. They share the knowledge and identify the gap of the student’s especially non-traditional students who
requires even digital supports. Female academics act as a knowledge gatekeeper in promoting or articulating
innovation. This will include enabling the non-traditional students from digital immigrants to digital natives
(Prensky2011).
Intrapreneurship
Intrapreneurship is entrepreneurship by employees in existing organisations (Antoncic and Hirsh, 2003). The
academic environment has been changing over the past few decades and the contribution of academic facilitators in
terms of knowledge transfer has obtained a great plethora of research success. Indeed, the boundary of the academics
who demonstrates entrepreneurial competencies are not defined clearly and lead to the question of how far the
academic intrapreneurship can be promoted? To answer this question, one should have an idea about what is
intrapreneurship? According to Schumpeter “Intrapreneurship consists of doing things that are not generally done in
the ordinary course of business routine” However, Stimulating intrapreneurship requires practicing entrepreneurial
culture within the institution and becoming more intrapreneurial should be considered a learning process (Wakkee, I.,
Elfring, T. & Monaghan, S,2010).Female academics from a business background employed in higher education setting
demonstrates more intrapreneurial competencies rather than female academics comes from a non-business
background.
Female academics and intrapreneursip in higher education
Female academics from business background provides firsthand commercial experience to traditional and non-
traditional students. However, they are able to support more nontraditional students as the non-traditional students
returning to education comes with bags of experience and they require academic mentorship and career guidance and
they returned to education aiming to become their own boss or develop their entrepreneurial mindset to become an
intrapreneur (Taniguchi and Kaufman, 2005). These students with family and parental responsibility struggle to juggle
between their academic, business and family life. Female academics demonstrates intra-preneurial competencies by
bringing innovation into the classroom and also provide networking opportunities to the students. The philosophy of
female academic intrapreneurs encourage students to equip them for their future.
The role of female entrepreneurs employed in Higher education
Female entrepreneurs employed by University Partnership programme to teach Entrepreneurship education has the
ability to create new products or services or business process from existing ones as they are already an entrepreneur
externally and an intrapreneur internally. This concept can be applied to build the entrepreneurial capacities among
the students to enhance their employability skills.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
19
Risk-taking and a change orientation
The character of any entrepreneur is risk taking, so female academics who are connected with the business can enable
the students to take calculative risks by providing them a firsthand commercial experience by arranging additional
activities such as Global business club. This will prepare the non-traditional students who are pursuing their higher
education in University Partnership Programmes.
Pro-activeness and Healthy competition:
As female academics who are not connected with the commercial environment directly or externally may be proactive,
however, as their level of exposure is limited due to their early career research stage and may sometimes only be
theoretical. Healthy competitions can be organized among those female academics to come out with new initiatives
or projects that will benefit the students as well as the organization.
Income generation
Entrepreneurial Universities with entrepreneurial mindset generate income by an academics who are directly
connected with the business. These academics generate revenue by attracting research funding. However, in
University Partnership programmes academics who connected with the business directly through their knowledge can
encourage such activities and also transfer their knowledge to the non- traditional students by providing academic and
career mentorship. (Perkmann, M., Walsh, K. (2009).
Innovation and Intrapreneurship
Female Academics from an entrepreneurial background deal heavily and effectively with the issues in their pedagogy
by introducing innovative teaching methods, promote design thinking process. Students, particularly, non-traditional
students are highly encouraged to get ready to become the intrapreneurs of next generation when they have a need to
juggle between their family, career and their student life (Firend, Al. R. 2019; Rasmussen, E., Mosey, S. & Wright,
M. 2014).
For example QAHE‘s first student magazine developed by non-traditional students where they had an opportunity to
participate in various entrepreneurial activities within the class room introduced by a female academics from a
business background as they combined their theoretical knowledge and practical experience while delivering such
lectures. (Siegel, Donald S., and Mike Wright. 2015b).Academic entrepreneurs build, amend and shape the future of
non-traditional student’s towards entrepreneurship which gives the learners an opportunity to establish themselves
by being independent (Siegel, Donald S., and Mike Wright. 2015b).
2. Methodology
The author used case study method to study about the female academics who were directly involved with the business
and the challenges faced by them in an academic environment especially university Partnership programme. The
author used primary and secondary sources of data for the purpose of this study. Female entrepreneurs employed as
academic were chosen for the purpose of this study who were involved in University Partnership programme in
London U.K teaching various modules for business studies only. A detailed interview was conducted. Data from the
Journals, articles newspapers, internet, books and concerned organizations have been used for the secondary data.
Female academic who are also entrepreneurs were identified, and the author conducted semi structured interview and
also some of them via telephone. The researchers categorized their interview data into four sectors - facilitating factors,
hindering factors, policy recommendations, and suggestions from the female academics coming from non-business
background (not an entrepreneurs) – and also how they could engage the learners effectively and promote
employability among learners. The author agreed to maintain confidentiality and created a supportive environment in
which each member of the team felt safe to share all ideas, perspectives and conclusions.
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
20
3. Findings
3.1.
Challenges encountered by the female academics from non-business background
One of the challenges encountered by the female academics who are intrapreneurs is the liberty to manage between
different modes of knowledge production, using different opportunity, novelty and advantage‐ seeking
processes .Female academics who acquire or have acquired entrepreneurial skills recognizes suitable entrepreneurial
opportunities and possess the characteristics to take risks. They can also transfer such skills into the classroom
environment by engaging traditional and non -traditional students.
Academic researchers who tied up in collaborative research are explicitly commissioned by contract researchers (Van
Looy et al. 2004).’The door is widely opened for female academic intrapreneurs when competing with other
departments in hiring and promotion. Says one of the female academic entrepreneurs involved in delivering Human
resource management for a partnership programme in London, .However, funding opportunities were given to male
academics who are entrepreneurs rather than female comes from non-business background as there is an issue of
worthiness needs to prove especially if the female academics are in their early career research stage.
The researcher finds that female academics from business background are able to bring innovations into the classroom
and equip the student community more than the female academics comes from a non-business background. However,
grooming intrapreneurship among female academics from a non-business background will be difficult if they are not
ready to change. Intrapreneurship is effective in attracting and retaining talent. When individuals are given a chance
to ideate, create and execute themselves, there is a lot more job satisfaction.
Lack of Ownership among the female academics who are from non-business background as they afraid to come out of
their comfort zone.
Ways to develop intrapreneurial competencies among female academics who are not connected with the business
1. Enable people: University partnership programme must prepare its intrapreneurs with decision making and
independence. Female academics must feel ownership for the improvements and advancement they have generated.
In this respect, academics who are intrapreneurs need to be encouraged to create solutions independently of the chain
of command
2. Be apparent
Allow individuals to access to information. Trusting employees with important company information and making
them feel included in organizational decisions will make them feel like more involved in the business as well as its
systems and processes, regardless of their own individual roles.
4. Recommendations
4.1. Management support
Everyone is not an entrepreneur. Some demonstrate their entrepreneurial competencies in their work place than others.
In every company, intrapreneurs already exist within them, but they need to be discovered, nurtured and boosted.
University Partnership and Industry Partnership programmes should be launched to support the female academics
who wanted to connect with the business to provide firsthand experience to the students in the class room. Colleges
offering university partnership programme should encourage or motivate female academics to become an
intrapreneurs. Strong leadership support is required to promote and communicate the value of research
commercialization.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
21
4.2. Government support:
Greater level of support and funds should also be allocated to University Partnership programmes specially to promote
more female academics to become intrapreneurs. This will encourage female students to come forward and learn the
experience to become a future entrepreneur. Funding mechanism is also essential for universities to commercialise
their research activities. Government should establish such mechanism so that University Partnership programmes
also receive their share.
4.3. Research institutions acts as intermediaries
Research institutions recognized by government should act as an intermediary between the university researchers and
the industry users to commercialize their research activities. Banks and other financial institution should come forward
to support the commercialization process and fund the University research setting. This will encourage more female
academic entrepreneurs to establish their research and acts as gatekeepers. (Etzkowitz, Henry. 2003.)
4.4. Entrepreneurship and skill Development programme
Entrepreneurship and skill Development programme should be established in university Partnership programmes and
indoctrinating entrepreneurship into universities’ teaching and research activities and developing an entrepreneurial
culture in universities; Research department should establish a better support system in terms of getting patent and
copy right and a fair reward system should be initiated to motivate female academic entrepreneurs specially in their
early career stage.
4.5. Access to mentorship
Female academic entrepreneurs should have access to mentorship and experienced female entrepreneurs should acts
as a mentor to motivate emerging female academic entrepreneurs to support others in the process of employability.
6. Conclusion
Female intrapreneurship is one of the emerging fields where there are opportunities for female academics to
contribute to the growth of their institution. These intrapreneurs work with non- traditional students, industrial experts
and also the relevant stake holders to enhance the quality of classroom education by bringing innovation and equipping
students. So there is a need to develop entrepreneurship among female academics who can shape the future of non-
traditional students, who do not be reluctant to equip themselves (Firend, Al. R., 2019; Cohen et.all 2002). Therefore,
developing female intrapreneurship in the academic institution through various initiatives and support will promote
the learners and increase the employability of the students. The number of graduates who establish their own
businesses and become self-employed is low when compared to the number of graduates who build their business
during their studies or after they completed their higher education. So it is the responsibility of the University
Partnership programmes to make available to its students by developing intrapreneurship among female academics
who can influence the students not only by theory on the other hand by practice. The author tried her level best to
elucidate the role and came out with managerial implications and further research. Limitations and lessons learnt are
also included in this article
6.1. Implications of Future Research and lessons learnt
The present study aims to bring out the need and importance of developing intrapreneurial mindset or characteristics
among female academics to provide first- hand commercial experience. This will develop an entrepreneurial mindset
among the non –traditional business studies students in London. Further studies can be conducted among traditional
students who are from social science disciplines.
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
22
6.2. Lessons learnt
There is a need for female academics to become intrapreneurs to develop and enhance their skills and bring out
different classroom ideas to engage and influence the non- traditional students.
An intrapreneur needs to have a sense of direction and able to influence others while catering to the needs of the
business and also keep that in mind students are no longer the prisoners of their traditional teaching methods. Good
support system is one of the requirements for an entrepreneurial activity especially networking. This is applicable to
the female academics to enable themselves and the student community
6.3. Research limitations
The case setting limits the applicability of the research to other traditional university institutions as in traditional
university settings the academics were recruited mostly during their mid-level career stage or who are very
experienced in research and funding. The female academic intrapreneurship provides a series of logically related
conceptual bins that form a basis for future research. This study is limited to non-traditional international business
studies students and may not be applicable to traditional learners who are not pursuing business degrees.
References
Antoncic, B. and Hirsch, R.D. (2003) Clarifying the Intrapreneurship concept. Journal of Small Business and Enterprise Development 10 (1) 7
24
Audretsch, D. B. 2014. “From the Entrepreneurial University to the University for the Entrepreneurial Society.” The Journal of Technology
Transfer 39 (3): 313–321.
Cohen,W.M.,Nelson,R.R.,Walsh,J.P.,2002.Linksandimpacts:theinfluenceofpublicrese archonindustrialR&D.ManagementScience48,1–23
Etzkowitz, Henry. 2003. “Research Groups as ‘Quasi-firms’: The Invention of the
Entrepreneurial University.” Research Policy 32: 109–121.10.1016/S00487333(02)00009-4[Crossref], [Web of
Science ®], , [Google Scholar]OpenURL University of Roehampton
Etzkowitz, H. Kemelgor, C. & Uzzi, B. (2000). Athena Unbound: The Advancement of Women in Science and Technology. Cambridge:
Cambridge University Presss.
Firend Al. R. (2019), Strategic Mistakes: Examples on How global companies go wrong. Amii.us, ASIN: B07YHLXNSG
Firend Al. R. (2019), Business Model: Simplifies with examples from Global Companies. ASIN: B0831TKDBK
Leitch, C., S. A. Hazlett, and L. Pittaway. 2012. “Entrepreneurship Education and Context.” Entrepreneurship and Regional
Development 24 (9–10): 733–740
Perkmann, M., Walsh, K. (2009). The two faces of collaboration: impacts of universityindustry relations on public research. Industrial and
Corporate Change, 18(6), 1033–1065.
Prensky (2011)Digital Natives, Digital Immigrants By Marc Prensky From On the Horizon (MCB University Press, Vol. 9 No. 5, October
2001) © 2001 Marc Prensky.
Rasmussen, E., Mosey, S. & Wright, M. 2014. The influence of university departments on the evolution of entrepreneurial competencies in
spin-off ventures. Research Policy, 43, 92-106.
Siegel, Donald S., and Mike Wright. 2015a. “Academic Entrepreneurship: Time for a Rethink?” British Journal of Management Studies 26:
582–595.
Siegel, Donald S., and Mike Wright. 2015b. “University Technology Transfer Offices, Licensing, and Startups.” In The Chicago Handbook of
University Technology Transfer and Academic Entrepreneurship, edited by Albert N. Link, Donald S. Siegel, and Mike Wright, 1
40. Chicago, IL: The University of Chicago Press.
Taniguchi, H., & Kaufman, G. (2005). Degree completion among nontraditional college students. Social Science Quarterly, 86(4), 912-927.
doi:10.1111/j.00384941.2005.00363.x
Van Looy, B., Ranga, M., Callaert, J., Debackere, K., Zimmermann, E. (2004). Combining entrepreneurial and scientific performance in
academia: towards a compounded and reciprocal Matthew-effect? Research Policy, 33(3), 425-441.
Wakkee, I., Elfring, T. & Monaghan, S. Creating entrepreneurial employees in traditional service sectors. Int Entrep Manag J 6, 1–21 (2010).
https://doi.org/10.1007/s11365-008-0078-
2020 The International Journal of Business and Management Research, Vol.13 Number 1
23
Factors Influencing Customer’s Trust in Online Shopping in
Selangor, Malaysia
Sunny Omenazua
Limkokwing University, Malaysia , Inovasi 1, 1, Jalan Teknokrat 1/1,
Cyberjaya, 63000 Cyberjaya, Selangor, Malaysia
Abstract
Electronic commerce has grown to be a part of Malaysia’s economic development in line with the growth of internet. The purpose
of this research is to explore the influence of customer trust in the mechanism of online shopping in Selangor, Malaysia. The outcome
and the findings of this research will be beneficial to online retailers as well as online shopping industry by providing valuable
knowledge and key fundamental issues associated with the industry. This study has found transaction security and privacy control,
product quality, customer service quality, website design and reputation have significant influence on online trust.
Keywords: E-commerce; Online Trust; Transaction security and privacy control; Product quality; Customer service quality; Website design;
Reputation
1. Introduction
1.1. Background of the Study
The evolution of faster internet connectivity and the availability of powerful online tools has transformed the landscape
of doing business and resulted in a new commerce arena. Electronic commerce has facilitated many advantages to
companies that seek to expand globally and geographically by gaining new customers with search engine visibility and
lowering cost. Electronic commerce also enabled customers to eliminate travel time and cost to visit and reach their
preferred physical store. In this matter, consumers can visit the web stores from the comfort of their homes and offices
as they sit in front of the computer (Jane, 2006). Efraim Turban et al. (2010) describe electronic commerce as it is “the
process of buying, selling, transferring, or exchanging products, services, and or information via computer networks,
mostly the internet and intranet”. The concept of online shopping was first coined before the (WWW) was in use with
real time transaction processed from a local television. Online shopping has become very popular in recent years, and
Amazon is among the company that have become very successful in online business. During the internet bubble in
1999-2000, the founder of Amazon Jeff Bezos introduced the first online bookstore with a presence only on the internet.
Later, many online shopping portals such as MSN.com and Yahoo.com also establish online shopping channels where
customers have been offered variety choice of products. Through online shopping, customers can buy variety of
products comprising books, clothes, accessories, cosmetics and many more. With so many sellers in online, many
consumers do not know whom they should trust (Majid & Firend, 2017). However, Success of electronic commerce
depends on many factors. Trust is among the determinant of factor that is behind the success of e-commerce. Trust is a
multifaceted and can be viewed from many angels such as transactions, information content, product, technology and
institution. In the context of electronic commerce, trust is especially important since uncertainties exist in interactions
over the internet.
Therefore, trust is something that e-commerce must strive and takes a period of time to achieve it. Several researchers
have expressed that trust is critical component influencing the success proliferation of electronic commerce. Previous
studies have also shown that trust is very important to online settings (Collier & Bienstock, 2006; Gefen & Straub,
2003; Majid & Firend, 2017) and trust has been considered as a key factor in online shopping (Gefen et al., 2003b;
Gefen & Straub, 2003; Grabner-Kraeuter, 2002; Pavlou, 2003). Moreover, Quelch & Klein (1999) suggested that trust
is important factor in increasing purchase over the internet, especially at this early stage of a commercial development.
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
24
1.2. Problem Statement
Electronic business also referred to as e-business is just more than buying selling. Electronic business simply involves
sharing information, communicating with suppliers and collaborating with external partners to be able to conduct the
business. However, with the increase of number of new businesses adopting the internet use as a way to conduct a
business, customers are becoming vulnerable to risk. In fact, internet enabled many companies to seek opportunities
and expand their business via internet but at the same time, criminals have find their way to harm others and criminals
nowadays take advantage of cyber-space to use for crim.
Common threat customers can experience may include hacking, cracking, masquerading, eavesdrop, spoofing, sniffing,
Trojan horses, viruses, wiretaps, and many more. Therefore, the internet-based crime has increased dramatically along
with the popularity of online shopping. Although previous studies have concentrated on online shopping in the world,
there is still a need for a closer examination of the online shopping intensions in specific countries (Firend Al. R., &
Qian, Wang, 2018; Bobbit & Dabholkar, 2001; Goldsmith, 2002; Salisbury, et al., 2001). Subsequently, online
shopping involves higher level of risk compare to visiting a physical store or shop because simply online transactions
lack the physical assurances of traditional shopping experience (Grabner & Kraeulter, 2002). Despite that all these risks
that are reducing the sale through online shopping.
Therefore, trust must be created so that customers feel secured to purchase through online. Hence, lack of trust can lead
an e-commerce to derail. As trust is one of the factors influencing the successful proliferation of e-commerce, it also
affects a number of factors essential to online transaction such as security and privacy control as well as web-site design
(Gefen, 2000). Understanding these factors would significantly play a crucial role in devising appropriate measures to
facilitate trust.
Firend Al. R. (2018) and Yoon (2002) suggest that trust should always be given substantial weight in relation of the
virtually (faceless and store less) of online transactions that base their own existence on the level of customer trust. So,
Pew internet reports that online vendors were able to alleviate customer’s online privacy and security issues, the
percentage of online buyers would increase from 66% to 73%. Nielsen study: 86% of the world’s online population has
used the internet to make a purchase.
Thus, this research intended to ascertain the influence of customer trust towards online shopping in Selangor, Malaysia.
2. Literature Review
2.1. Transaction Security and Privacy Control
The first variable is transaction security and privacy control. Transaction Security involves in extent risk and wants a
statement promising return policy (Yoon, 2002). Transaction security represent to the probability that a purchase results
in loss of money or other resources. A high level of security in the online shopping platform has a significant positive
correlation on customer trust, owing to the lowered risk involved with exchanging information (Yoon, 2002, Monsuwe,
Dellaert & Ruyter, 2004). However, Newcomers are more likely to worry more about credit card theft than experienced
users of the website (George, 2002).
While Privacy control is directly related to customer trust that is a vital competitive advantage in the online environment
(Spar & Bussgang, 1996, Yang, Ahmed, Ghingold, Boon, Mei & Hwa, 2003). A privacy concerns has been frequently
cited and is the key reasons consumers do not engage to make online purchase over the internet (Firend Al. R., 20189
George, 2002). However, concerns over privacy span the dimensions of environmental control and secondary use of
information control. Control over secondary use of information is whereby consumers perceived ability to control the
use of personal information for other purpose during the transaction. So, this variable will measure the influence of
Transaction Security and Privacy Control on customer trust towards online shopping.
2.2. Product Quality
The second variable is product quality. Online consumers are difficult to examine or test the product to make sure that
they are satisfied with what they will receive later after purchase. Product quality is an intrinsic property of a product.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
25
Product quality is very critical especially in the context of online shopping. Enhancing product quality will have long
lasting positive effect in improving customer satisfaction (Christian & France). A high-quality product conveys image
about the product information and boosts consumers’ confidence about the vendor. The perception of quality of product
depends on various aspects such as product features. Product quality means to incorporate features that have a capacity
to meet consumer needs and provide customer satisfaction by altering products (goods) to make them free from
deficiencies or defects (Juran, 2005).
Subsequently, offering a wide range of products is often a key for online vendors to keep customers coming back.
Online vendors who have offered a wide range of products and selection seem to be more successful (Christian &
France, 2005). Thus, superior product assortment results in positive influence of customer satisfaction (Szymanski &
Hiise, 2000), particularly if the customer wants an item that isn’t widely available.
On the other hand, online consumers are concerned for product information that must be described for sale with texts,
photos and multimedia files. Online consumers are also concerned for product returns if the product do not satisfy and
meet their satisfaction. Product returns is one of the hassles consumers experience and it involves higher costs for
returning products purchased on online. A research conducted by university of Illinois showed that despite the
convenience of online shopping, lower prices are often combined with lower product quality. Although shopping is
more convenient than ever before, manufacturers have little incentives to make and produce high quality products when
selling their wares over the internet (Liu, 2012). So, this variable will measure the influence of product quality on
customer trust towards online shopping.
2.3. Customer Service Quality
The third variable is customer service quality. Good customer service is lifeblood of any business, be it traditional or
online business. Providing excellent customer service is all about bringing customers back (Susan, 2008). Thus,
customer service Customer services are so important in demining the success of online shopping. Customer service is
the provision of service to customers before, during and after a purchase (Firend Al. R., 2017; Turban, 2002). Customer
services play an important role in online shopping so that to generate income and revenue. A good customer service
experience undoubted can change the perception a customer has on online shopping.
Subsequently, delivery speed is the amount of time necessary for the package to go from the distribution centre to the
customer’s address (Christian & France, 2005). Delivery problem is a very common issue existing in the online
shopping environment. On the other hand, the time lag between consumers making the purchase by conducting the
transaction and the final delivery of the products can even too long. Online consumers are concerned that online vendors
may not satisfactorily deliver the goods ordered or that the merchandise may be inferior incorrectly selected or even
may never arrive (Abramson & Hollingshead 1999).
Research indicates that delivery performance enhances customer online buying satisfaction. Furthermore, other
dimensions of good online customer service include replying online customer promptly, and handling complaints. So,
this variable will measure the influence of customer service quality on Customer Trust towards Online Shopping.
2.4. Website design
The design of the company’s (Website) is extremely important as such design may encourage customer trust to return
and make repeat purchase to that particular website (Ballantine, 2005). Effective website design includes navigation
capability or visual appeal of the website (Cyr, 2008). In fact, there are many different categories of products and
services, in order to avoid straying on a website; the website functionality should work quickly and correctly. Thus,
poorly constructed components will only leave customers become frustrated and distrust the site. On the other hand,
the company’s website should be appealing. Subsequently, content is the actual substance of a website and this also
demands attention nowadays days.
Therefore, too much of content formatting may leave a bad impression of the minds of your visitors. Other important
things that need to be given priority when designing website include colour, the type of words, the space of the webpage,
the website map and so on. Therefore, key elements of a good website design should include its appearance, content,
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
26
functionality, and usability. Hence, this variable will measure the influence of website design on Customer Trust
towards Online Shopping.
2.5. Reputation
Reputation is very important in order to make ecommerce profitable. The next biggest concern for consumers after
security and privacy is reputation of online vendors. Simply, consumers do know the reputation of vendors they are
dealing with. Therefore, having a good reputation leads to competitive advantage, because reputation affects image of
ecommerce business (Richard, 2010). A positive reputation helps online vendor’s keep to attract and retain good
consumers. A good reputation enables online vendors the ability to charge a premium for their products and services.
Online consumers value reputation above the price and are willing to repeat purchase if consumers feel they will be
getting a good deal (Patrick, 2011). Other factors associated with reputation include size of vendor, the vendor
perceived integrity, and the vendor perceived competency. Therefore, this variable will measure the influence of
reputation on customer trust towards online shopping.
3. Research methodology
3.1. Research Framework
A research framework is used to describe possible courses of action or to present a preferred approach to an idea or
thought. A research framework also can serve like maps that give coherence to empirical inquiry, and depend upon the
research question or problem (Marza 2007; Majid & Firend, 2017). The conceptual framework for this research is
illustrated in the figure below. The independent and dependent variables have been stated below:
Fig. 1. Research Framework
3.2. Research Hypothesis
A hypothesis is described as a tentative statement about the relationship or correlation between two or more variables.
A hypothesis on the other hand is a specific, testable prediction about what you expect to occur in a research (George,
2003). Generally, there are two types of hypothesis null hypothesis and alternative hypothesis. Based on proposed
model on Figure 1, the hypotheses in this study are as follows:
H1: There is a significant relationship between transaction security and privacy control and customer trust in
online shopping.
H2: There is a significant relationship between product quality and customer trust in online shopping.
H3: There is a significant relationship between customer service quality and customer trust in online shopping.
H4: There is a significant relationship between website design and customer trust in online shopping.
H5: There is a significant relationship between Reputation and customer trust in online shopping.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
27
3.3. Sampling
Target population of this research were people from Selangor who have been previously shopping online. The rule of
thumb utilized here for the selection of sample size was Krejcie & Morgan’s rule of thumb (Krejcie & Morgan 1970).
The sampling size of this research is 150 participants that were selected out of the entire population.
3.4. Organization of the Questionnaire
The questionnaire consists of five sections. The first part which is Section A measures “Transaction security and
Privacy Control” on Online shopping. Section B measures Product quality on online shopping. Section C measures
customer service quality on online shopping. Section D measures website design on online shopping. Section E
measures Reputation on online shopping.
3.5. Administration of the Questionnaire
This research employs self-administered questionnaires. Self-administered questionnaire is a questionnaire that a
respondent completes on his/her own, using either on paper or computer.
Questionnaire is a type of survey method use a standardized set or list of questions given to individuals or group of
people. Subsequently, self-administered questionnaires offer enables the researcher to reach a large number of potential
respondents in a variety of locations such as using online questionnaires. Thus, distributing and completing the
questionnaires will approximately five days.
Self-administered questionnaires are one of the most frequent used methods for collecting data from the respondents.
Self-administered questionnaires take time, and cost. However, survey questionnaires can be completed in either
supervised or unsupervised settings.
The design of the questionnaire surveys conforms to the opinions of Saunders, Lewis, and Thornhill (2009) used Likert-
style rating scale in which respondents to both surveys were asked their level of agreement to set of questions under
each variable. The format used for indicating level of agreement was a 5-point-scale which ranges from 1 indicating
strongly disagree to 5 indicating strongly agree. The distribution of the questionnaire took place in Selangor and the
questionnaire was self-administered directly to the target population in a time duration of three (3) weeks, each week
with number of questionnaires distributed and collected from the research population as shown in the table 3.6.3 below.
155 questionnaires were distributed and 150 were collected back and analyzed. The response rate was 96.8%.
Table 1. Administration of Questionnaire
Weeks
Number of Questionnaires Distributed
Number of Questionnaires Collected for
Analysis
Week 1
60
58
Week 2
50
50
Week 3
45
42
4. Result and discussion
4.1. Demographic Analysis
4.1.1. Gender Distribution of Respondents
Table 2 below present the gender distribution of the respondents. It shows that out of the total number of respondents
(n=150) the number of males (59.3%; n= 89) that took part in the survey was more than that of females (40.7%; n= 61).
This results show that there were more of males than females that took part in the questionnaire survey.
Table 2. Gender Distribution of Respondents
Gender
Frequency
Percent
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
28
Male
89
59.3
Female
61
40.7
Total
150
100.0
4.1.2. Distribution of Respondents According to Online Shopping
This questionnaire item required the respondents to respond to the question “Have you heard about Online Shopping“?
The responses gathered and analysed revealed the following; 26 (17.3%) of the respondents responded “I have heard
about it but not sure about it”; 33 (22.0%) of the respondents responded “I have heard about it understand it”; while the
majority (60.7%; n=91) of the respondents responded “I have heard about it use it”. This result reveals the high level
of awareness of the respondents about online shopping hence necessary for answering the questions in the section B.
Table 3. Distribution of Respondents According to Online Shopping
Frequency
Percent
Heard but not sure
26
17.3
Understand it
33
22.0
Use it
91
60.7
Total
150
100.0
4.1.3. Distribution of Respondents According to Making Online Purchase
This questionnaire item required the respondents to respond to the question “Have you ever make online purchase or
have you ever know anyone that make online purchasing “? The responses gathered and analysed revealed the
following; 95 (63.3%) of the respondents which made up the greater percentage responded “I have made online
purchase”; and 55 (36.7%) of the respondents responded “I know someone who had make online purchase”. This result
shows that a majority of the respondents are actually critical to the answering of this questionnaire judging by the
greater number of them that have actually purchased something online.
Fig. 2. Distribution of Respondents According Making Online Purchase
4.1.4. Distribution of Respondents According to Opinion on Online Purchasing
This questionnaire item required the respondents to respond to the question “What is your opinion on online
purchasing“? The responses gathered and analysed revealed the following in order of response frequency; 30 (20.0%)
of the respondents responded “Shipping cost is very high”; 26 (17.3%) of the respondents responded “Risk of loss of
privacy”; 21 (14.0%) of the respondents responded “Less expensive”; 15 (10.0%) of the respondents responded
“Insecure”; 15 (10.0%) of the respondents responded “Offer discount”; 12 (8.0%) of the respondents responded “Risk
of getting low quality products”; 9 (6.0%) of the respondents responded “Secure”; 8 (5.3%) of the respondents
2020 The International Journal of Business and Management Research, Vol.13 Number 1
29
responded “Fraud or Theft of credit card transaction”; 7 (4.7%) of the respondents responded “Less Hassle”; while 4
(2.7%) of the respondents were not specific and responded “Others”.
Table 4. Distribution of Respondents According to Opinion on Online Purchasing
Frequency
Percent
Secure
9
6.0
Insecure
15
10.0
Expensive
3
2.0
Less expensive
21
14.0
Less hassle
7
4.7
Offer discount
15
10.0
Shipping cost is very high
30
20.0
Risk of loss of privacy
26
17.3
Fraud or Theft of credit card transaction
8
5.3
Risk of getting low quality products
12
8.0
Others
4
2.7
Total
150
100.0
4.1.5. Distribution of Respondents According to Trust Online Purchasing
This questionnaire item formed the basis of the independent variable of this research and it required the respondents to
rate their trust in online purchase bearing in mind that all the factors are put right. In response to this item, the largest
percentage of the respondents (n =113; 75.3%) responded “Strongly Agree”; (n = 20; 13.1%) responded “Agree”; (n
=12; 8.0%) preferred to stay “Neutral”; (n =4; 2.7%) responded “Disagree”; while one person (0.7%) responded
“Strongly Disagree” The responses show a high degree of trust placed on online purchases judging from the
independent variables hence the respondents have a positive evaluation of the variables that leads to trust in online
purchasing.
Table 5. Distribution of Respondents According to Trust Online Purchasing
Frequency
Percent
Strongly Agree
113
75.3
Agree
20
13.3
Neutral
12
8.0
Disagree
4
2.7
Strongly Disagree
1
0.7
Total
150
100.0
4.2. Reliability Analysis and Validity
Table below is a visual display of the reliability measure of the variables tested in this research. The Cronbach Alpha
for the variables were all above 0.7 meaning that all the variables used in this research study are considered reliable
and this suggests that the items concerned adequately and consistently measure a single construct for each tested
variable.
Table 6. Reliability Analysis
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
30
Variable
Cronbach Alpha
No. of Items
Interpretation
Transaction security and
Privacy control
0.834
4
Excellent
Product quality
0.753
4
Good
Customer service quality
0.810
4
Excellent
Website design
0.838
4
Excellent
Reputation
0.745
4
Good
4.3. Hypotheses Testing
H1 analysis: The Pearson’s correlation coefficient (r) equals to 0.805 which shows that a strong positive correlation
exists between “transaction security and privacy control” and “customer trust in online shopping”. This statement
implies that an increase in the level of perception of transaction security and privacy control causes a corresponding
increase in the trust level the customers have in purchasing goods and services online.
H2 analysis: The Pearson’s correlation coefficient (r) equals to 0.891 which shows that a strong positive correlation
exists between “product quality” and “customer trust in online shopping”. This statement implies that an increase in
the quality of product up for sale online causes a corresponding increase in the trust level the customers have in
purchasing the product online.
H3 analysis: The Pearson’s correlation coefficient (r) equals to 0.768 which shows that a strong positive correlation
exists between “customer service quality” and “customer trust in online shopping”. This statement implies that an
increase in the quality of customer service causes a corresponding increase in the trust level the customers have in
purchasing goods and services online.
H4 analysis: The Pearson’s correlation coefficient (r) equals to 0.879 which shows that a strong positive correlation
exists between “website design” and “customer trust in online shopping”. This statement implies that an increase in
simplicity, attractiveness, design and perception of the website causes a corresponding increase in the trust level the
customers have in purchasing goods and services online.
H5 analysis: The Pearson’s correlation coefficient (r) equals to 0.688 which shows that a strong positive correlation
exists between “reputation” and “customer trust in online shopping”. This statement implies that an increase the
reputation of the online company causes a corresponding increase in the trust level the customers have in purchasing
goods and services online.
Table 7. Hypothesis Testing
Customer trust in online
shopping
Hypothesis testing
Transaction security and privacy
control
Correlation Coefficient
.805**
Hypothesis accepted
Sig. (2-tailed)
.000
Product quality
Correlation Coefficient
.891**
Hypothesis accepted
Sig. (2-tailed)
.000
Customer service quality
Correlation Coefficient
.768 **
Hypothesis accepted
Sig. (2-tailed)
.000
Website design
Correlation Coefficient
.879**
Hypothesis accepted
Sig. (2-tailed)
.000
Reputation
Correlation Coefficient
.688**
Hypothesis accepted
Sig. (2-tailed)
.000
2020 The International Journal of Business and Management Research, Vol.13 Number 1
31
4.4. Multiple Regression Analysis
Table 8 shows that there is a correlation between the 5 independent variables (Transaction security and Privacy control;
Product quality, Customer service quality, Website design and Reputation) with the dependent variable; Customer trust
in online shopping (R = .919). The independent variables in this study (Transaction security and Privacy control;
Product quality, Customer service quality, Website design and Reputation) explain 84.4% of the variance in Customer
trust in online shopping (R² = 0.844) and 83.9% of the variance of Customer trust in online shopping (Adjusted R² =
0.839). Table 9 (ANOVA) show that the regression coefficient is significant (F (5, 233) = 50.95, p < 0.01).
Table 8. Model Summary (Regression Statistics Table)
a. Predictors:
(Constant),
Transaction security and Privacy control; Product quality, Customer service quality,
Website design and Reputation
Table 9. Analysis of Variance (ANOVA) a. Dependent
Variable:
Customer trust
in online
shopping
b. Predictors:
(Constant),
Transaction
security and
Privacy control; Product quality, Customer service quality,
Website design and Reputation
5. Conclusion
This study has found Transaction security and Privacy control, Product quality, Customer service quality, Website
design and Reputation. have significant influence on online trust. The correlations between the independent variables
and the dependent variable were statistically significant using an alpha level of 0.01. From the results gotten after the
conduction of a correlation test it was deduced that as the independent variables of the studies increases, there would
be a corresponding increase in the dependent variable. The highest correlation was between product quality and
customer trust in online shopping (r = 0.891, p-value= .000).
The pattern of positive and statistically significant correlations indicates that participants who were satisfied with one
aspect of the independent variable and requirements tended to be satisfied with other aspects as well.
According to the correlation tests, the attitude that consumers have do influence their online shopping intentions and
businesses should keep in mind that consumers these days are very knowledgeable, and by surfing over the internet,
they can see the difference between different products within few seconds. Competition in being creative is very
important. Furthermore, multiple linear regression analysis was used to evaluate the combined influence of all five
independent variables on the dependent variable. Results of the regression revealed that 84.4% of variation in the
dependent variable is caused by the combined variation of the independent variables. This shows a very strong
relationship and proves that the factors that were studied in this research do have an impact on customer’s online
purchase intentions and attitudes.
Consequent to the finds in the objectives one and two it is pertinent to make recommendations thus; that companies,
advert agencies that are directly and indirectly linked to the sales and promotion of consumer products online should
in line with the findings of this research make good the security and privacy features in which they interact with the
potential customers who are in need to purchase their products because as seen in the research findings, this contributes
Model
R
R Square
Adjusted R Square
Std. Error of the
Estimate
1
.919a
.844
.839
.322
Model
Sum of Squares
df
F
Sig.
Regression
Residual
Total
81.049
14.951
96.000
5
144
149
156.118
.000b
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
32
positively in increasing customer trust in online shopping and the if customer trust is increased, there would be a
corresponding increase in customer purchase intention.
In addition, it is recommended that the website for the products for sale are attractive, that the reputation of the
companies is enhanced via strategic means; that the service offered to customer are of high quality and that the products
offered are also of high quality as all these have been shown in the research findings to have a significant and strong
positive relationship with customer trust in online shopping which is directly linked to increase in customer purchase
intentions.
References
Collier JE, Bienstock CC. Measuring service quality in e-retailing. Journal of Service Research 2006;8(3):260–75.
Efraim, Turban., David, King., Jae, Lee., Ting-Peng, Liang., & Deborrag, Tyrban. (2010) Electronic commerce: defining electronic commerce.
NEW Jersey: Pearson Education.
Firend Al. R., Qian, Wang, (2018) The value of loyalty programs in marketing of services, The International Journal of Business and
Management Research. Vol.11, No.1.
Firend Al. R., Qian, Wang, Marketing Strategies of Services and Purchasing Incentives in Asia (September 30, 2018). J. Mgt. Mkt. Review 3
(3) 104 – 110 (2018). Available at SSRN: https://ssrn.com/abstract=3267332 DOI: https://doi.org/10.32893/18.JMMR.1
Firend, Al. R. (2017) City branding, Kuala Lumpur vs. Dubai; the tail of two cities, The International Journal of Business and
Management Research. Vol.10, No.2
Majid, M., Firend Al. R. (2017) Social media, online shopping activities and perceived risks in Malaysia, International Journal of Economics
and Financial Management
Firend, Al. R. (2017) Determining female consumer’s insight into products and shopping, The International Journal of Business and
Management Research. Vol.10, No.1 DOI: https://doi.org/10.32893/2017.6.1.1
Mayer, R.C., Davis, J.H. & Schoorman, F.D. (1995), “An integrative model of organizational trust”, Academy of Management Review, Vol. 20
No. 3, pp. 709-34.
Michael, R. Solomon. & Elnora, W. Stuart. (2003) Marketing: Marketing satisfies needs. New Jersey: Pearson Education.
Mie-Jane, Chan & Yann-Haur, Huang (2006) Factors that affect consumers trust online in online shopping Taiwan [online]. Ph.D. Thesis,
Northwester Polytechnic University. [Accessed 11 April 2013]. Available at: < http://www.jgbm.org/page/14%20Mei-Jane%20Chan.pdf >.
Naresh, K. Malhotra., & Mark, Peterson. (2006) Basic Marketing Research: Software Applications. 2nd ed. New Jersey: Prentice-Hall.
Naresh, K. Malhotra., & Mark, Peterson. (2006) Basic Marketing Research: Formulating the Hypothesis. 2nd ed. New Jersey: Prentice-Hall.
Naresh, K. Malhotra., & Mark, Peterson. (2006) Basic Marketing Research: Frequency distribution. 2nd ed. New Jersey: Prentice-Hall.
Ravi, Kalakota. and Marcia, Robinso. (2000) e-business roadmap for success: moving from e-commerce to e-business. 8th ed. Massachusetts:
Addison-Wesley
S, Srinivasan. (2004) Role of trust in e-business success. Information Management & Computer security. [Online]. 12 (1) pp. 66-72 [Accessed
10 May 2013]. Available at: < http://web.nchu.edu.tw/~eschang/courseDir/slideDir/Role%20of%20trust%20in%20e-
business%20success.pdf>.
Sandra M, Shi F B. Consumer patronage and risk perceptions in Internet shopping [J]. Journal of Business Research, 2003, 56(11): 867
Zikumund, W.G. (2003), Exploring Marketing Research, South Western. USA
Zuroni, MdJusoh., and Goh, Hai Ling. (2012) Factors influencing consumer’s attitude towards e-commerce purchases through online shopping
[online]. 2(4) [Accessed 15 April 2013]. Available at:
<http://www.ijhssnet.com/journals/Vol_2_No_4_Special_Issue_February_2012/27.pdf>.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
33
Social media and small business in the U.K. The case of
Bournemouth
Firend Al. R, PhD, Shedrack I. Sedrack,
Abstract
This research aims at evaluating the impact of social media marketing on the development of small business in the city of
Bournemouth United Kingdom. Methodology employed encompassed primary and secondary data that has been collected through
a survey of managers working in small businesses in Bournemouth. Findings suggest that major advantage of the adoption of social
media as a primary marketing strategy as it helps small businesses in the promotion of branding, pricing and enhances customer
loyalty and retention. Findings further suggest that common social media platforms such as Facebook, Twitter, Instagram, YouTube
and WhatsApp are widely applied as tools amongst small businesses. The use of these channels helps small businesses attaining
awareness, branding, recognition and contributes to the development and growth of small businesses in the city of Bournemouth.
Findings further shows that younger managers are savvier in the utilization of social media as a tool for promoting your businesses.
Keywords: Social media; small business development; Facebook, Twitter, Instagram, YouTube and WhatsApp, branding; Bournemouth; U.K.
1. Introduction
Digital marketing and its connected channels are significant to the effectiveness of marketing programs, in an
environment where technological improvements creating a paradigm shift and constant disruption. Digital marketing
not only helps the companies in knowing their customers but also helps in communicating with them. Digital marketing
involves promotion of products and services through web, mobile, social media and direct mail. Medium and large
companies have started making use of social media marketing in combination with print media, advertising on
televisions. They have started giving more focus to social media marketing as it helps in building and maintaining
communication with the customers along with understanding their demands (Ryan, 2016). Many small business
organizations have also started using social media marketing for extending their customer base which is critical for
their business expansion (Grant, 2016).
Social media marketing is now recognized as a prominent marketing tool that can be used by the organizations for
supporting exceptional marketing function (Tuten and Solomon, 2014). It can help companies in connecting with their
customers by inexpensive and fast means of learning about customer wants. Social media marketing can be defined as
an online or digital platform that is developed for facilitating interaction or networking among a large number of users
(Walker, 2014).
Social media marketing helps in brand recognition by providing new modes for circulating the brand's content and
voice among the target customers. It helps the companies more accessible for both present and prospective customers.
Along with this, it also makes a company more recognizable and familiar to the existing customers. Social media
marketing also helps the organizations in improving their brand loyalty (Schivinski and Dabrowski, 2016).
1.2 Research Question
Research questions provide direction to the research work for attaining the research objectives, effectively. In the
context of this research study, the research questions are mentioned below:
1. What is the impact of social media on small businesses in Bournemouth?
2. Does the use of social media marketing contribute to the growth of small businesses in Bournemouth?
An answer to these research questions will help in examining the extent to which social media marketing proved to be
helpful in the sustainable development and growth of small businesses in Bournemouth. It will also assist in analyzing
the impact of social media marketing from different perspectives; on small business operating in Bournemouth.
1.3 Research Aim and Objectives
Research Aim
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
34
The principal focus of this research is to identify the significance of social media marketing on small business
development in Bournemouth. In the same context, the chief aim of this research work is on critically analyzing the
impact of social media marketing on the development and growth of small businesses in Bournemouth.
Research Objectives
In addition to above mentioned aim, the research work has also addressed certain objectives for gaining a broader
perspective of the research subject. Research objectives are as follows:
• To determine whether social media marketing has a positive impact on small businesses in Bournemouth
• To determine if there is a correlation between the use of social media marketing and profitability, brand
awareness, customer loyalty, engagement in small businesses in Bournemouth
• To determine if the use of social media marketing serves as a competitive advantage to small businesses
1.4 Research Significance
This research study will be provided in-depth information regarding the impact of social media marketing in the
development of small business entities. As this research study will provide detailed information regarding the impact
of social media marketing on growth and expansion of small businesses that will be helpful for the managers of small
business entities in Bournemouth. Small business can easily attain business objectives, such as high market share,
competitive position and brand equity. It will help them in understanding the significance of social media network in
brand promotion. Along with this, it will also acknowledge them with the strategic management approaches that they
can use for maximizing the benefit of social media marketing in increasing sales.
In addition to this, the information gathered in the research will help small businesses to determine the correlation
between the incorporation of social media marketing, brand awareness, profitability, customer loyalty and engagement
in small businesses established in Bournemouth. Along with this, the research work will help the staff member of small
businesses in Bournemouth to determine whether the use of social media marketing as a promotional tool helps in
achieving a competitive edge or not. Furthermore, the research will also make contributions in the academic field by
serving as a pivotal information source for the future researchers. It will help academic learner in evaluating the
importance of social media marketing in the UK.
2. Literature Review
According to Napoli (2011), the online environment in recent years is perceived by users from a new approach; that is
in a commercial manner. An arrival of online stores and emergence of social media have transformed users into
customers. Furthermore, the most vital role of social media has altered the way of communication for the marketers
and the customers (Napoli, 2011). In the similar context, Chu and Kim (2011) examined that information society has
an impact on the product evaluation and decision-making processes of the customers. In recent years, social media has
evolved as an innovative medium of acquiring a new product with the help of peer communication (Chu and Kim,
2011).
Ioanăs and Stoica (2014) assert that Internet based accompanied by virtual communities have transformed corporations,
consumers and societies with wide access to improved communication ability and better social networking. Social
media covers digital platforms used for connecting individuals who may be known or unknown to each other but
essentially have mutual interests. Therefore, social media networking can be described as the websites that link billion
of users from different parts of the world with similar viewpoints, hobbies and interests. YouTube, Blogs, Facebook
and Pinterest, are prominent social networking sites (Ioanăs and Stoica, 2014).
In the opinion of Strauss (2016), social media can be used by small companies for a variety of purposes. Whether its
content marketing, customer support, social selling, social media provide can perfect opportunity to small companies
in reaching their target audience and brand building (Strauss, 2016). However, as examined by Smith (2015), with the
availability of different platforms and fierce competition; it might be difficult for small entities to set their brand apart
and carve out place on Instagram, Twitter and Facebook (Smith, 2015). Hollensen (2015) however suggest, that social
media is a crucial tool for execution of customer relationship management (CRM), an important function of every
company in today's competitive business environment. CRM is defined as the development and management of long-
term relationship in mutual interest with the customers. Social media marketing supports the companies in cultivating
more lucrative and profitable relationships with the customers. It also helps in learning more about existing customers
2020 The International Journal of Business and Management Research, Vol.13 Number 1
35
along with attracting new customers (Hollensen, 2015). In the same perspective, Chou (2014), examined that majority
of the companies considering social media marketing as a fundamental approach to customer relationship management
that emphasizes on strengthening the customer relationship. It enhances customer relationship by quickly responding
to their queries made on social media channels such as Facebook, Twitter, Pinterest, WordPress and review site (Chou,
2014).
According to Strauss (2016), the usage of social media platforms such as Facebook, Twitter, websites by the companies
for promoting their products and services is known as social media marketing. The majority of the social media
platforms have their built-in analytics tools that enable organizations to keep track of its engagement of advertising
campaigns, progress and success (Strauss, 2016). Presently, organizations address their stakeholders including existing
and potential customers, suppliers, employees, bloggers, journalists and the general public through social media
marketing (Aaker, Kumar and Day, 2008).
In same aspect Chou (2014), analyzed that an important feature of social media marketing is that it supports both,
customer-to-business (B2C) interaction and customer-to-customer (C2C) interaction. Customers use social media
networking in daily life for numerous reasons. Companies use social media networking with the help of their social
groups which exert a noticeable impact on the consumer buying intent, behavior and implicitly on their buying decision
(Chou, 2014). Therefore, it has been analyzed that social media marketing can make useful contributions in brand
promotion and attract customers for every company irrespective of size and nature of business.
According to Davila and Epstein (2014), the companies establish marketing objectives before making a selection of
appropriate social media tool for marketing purpose. Setting objective permits companies to concentrate on winning
strategies and immediately pivot as things alter. The companies while using social media for brand promotion ensure
that every social media post is in the context of the strategic goal rather than just collecting shares, likes and pins. The
companies also ensure that the strategies and the content displayed on social media platforms focus on building brand
awareness with a positive customer perception for their respective business (Davila and Epstein, 2014).
In relation to the same aspect Lamberton and Stephen (2016), argued that using social media tools and other digital
marketing tactics along with traditional marketing approaches by the businesses have primarily focused on gaining new
customers by driving traffic. Businesses make consistent efforts for driving traffic by sharing, posting updated
information about the company on its website or social media page. This approach of frequently updating information
on social media platforms helps companies in informing their customers about every crucial detail that exerts influence
on their demand pattern (Lamberton and Stephen, 2016).
2.1 Evaluation of the Social Media Marketing Tools for Small Businesses Operating in the UK
According to Safko, (2010), the maintenance of effective long-term relationships with important and privilege
customers is known as Customer Relationship Management (CRM). CRM focuses on developing more profitable and
lucrative relationships with consumers and learning more about their needs and preferences regarding the products.
Social media refers to any online or digital platform which is designed to facilitate networking or interaction between
users, as it is considered as a significant part of the CRM. Social media marketing is becoming an important tool in the
execution of CRM. There are four types of social media channels or tools which are used in today's competitive
environment to develop the businesses and to focus on gaining a competitive advantage. Social networking sites are
used to connect individuals that are either known to each other or unknown but have mutual interests in interacting
with each other. Prominent social media marketing tools include Facebook and Pinterest (Safko, 2010).
Hays, Page and Buhalis, (2013), stated that numerous business organizations, especially
both small and large business, use social networking websites in order to connect online with individuals to share
information about products and services provided by the companies. Blogs are another popular type of social media
channel which is used for marketing purposes. WordPress and Twitter are other platforms for the companies as well
as consumers to connect with each other. These types of channels are unidirectional in a way that the site owner uses
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
36
the platform to express and share their opinions about a specific product or service. The third type of social media tool
identified is the user review site which is accessed by almost all the companies. This type of channel integrates the
connectivity aspects of social networking sites and opinion sharing aspects of the blog. These kinds of social media
marketing tools offer both advantages and disadvantages to businesses (Hays, Page and Buhalis 2013).
Small companies in the UK could likely be benefited if positive reviews are shared on user review sites about the
products and services, but they could also be adversely affected by negative reviews. Private message boards and chat
rooms are also termed as essential tools as these are related to the communities in which people come together to
discuss specific topics of interest. Examples of these tools include Mumsnet which is aimed at parents,
especially mothers, and Reddit, which has some topic-focused sub-boards regarding small businesses in the UK.
According to Poynter, (2010), social media is a major element of a content distribution plan executed by the companies
and the essential part of branding and marketing strategy. The mode of interaction and networking characteristics for
each social media channel are different from the other. Content creation and sharing on Facebook is different from
doing it on YouTube or Twitter. Different networks require different marketing approaches and evaluations for
achieving success. The other kinds of social media marketing tools that are used by small business companies in the
UK are YouTube and Instagram. These marketing tools are also effective and can be useful for the businesses that are
operating in the UK. In the current scenario, there is an essential need of using social media marketing tools for
marketing purpose. The most significant marketing tool that can be used for marketing purpose is Facebook (Poynter,
2010). Nowadays, almost all the small businesses in the UK have their pages on Facebook for sharing information of
the products manufactured by these companies.
3. Research methodology
This research is an exploratory research. Exploratory research design is suitable for the study as it helps in explore
research subject with varying depth levels. Additionally, it also helps in determining the data collection method and the
sampling methodology which can render important findings for attaining research aim and objectives in an effective
manner (Bergh and Ketchen, 2009).
The method which illustrates the flow of research work is known as the research approach. Inductive and deductive
approach is the two widely used reasoning methods implemented in research studies. Deductive research approach
begins with general theory and then gradually moves towards extracting a specific theory due to which it is also known
a top-down approach (Denscombe, 2012). On the other hand, inductive research approach begins with particular
observations, determines regularities, detects patterns for developing a tentative hypothesis. Deriving a generalized
theory or conclusion is its final result. It is known as bottom-up research approach (Gratton and Jones, 2010).
3.1. Data Collection Techniques
In order to collect adequate data about the research area for the purpose of attaining research aim and objectives; two
different data collection approaches have been considered. The justification of the reasoning is as following:
3.2. Primary Data Collection Method
In order to gather substantial information related to the impact of social media marketing on the growth, development
and expansion of small business organizations in Bournemouth, a survey through questionnaire has been conducted
with managers of small businesses (target population) in the city of Bournemouth, U.K. Bournemouth is a region with
a limited number of small businesses, so it is an appropriate geography having the potential for development of small
businesses. In this context, small businesses are defined as companies employing less than ten employees and having
an annual turnover less than €2million (Wilson, 2016). Survey questionnaires will be forwarded to managers through
emails; requesting them to give their contribution in the data collection process for accomplishing the research purpose.
Survey questionnaire was an effective instrument in collecting responses from relevant respondents. The target
population prove very effective in the study as they provide significant insight and information gained through
experience in their respective companies. Their insight helped in providing information in the context of particular and
related aspects enlightening the significance of social media marketing in increasing sales and profitability of small
companies in Bournemouth, U.K. Additionally, survey questionnaire method proved helpful in collecting first-hand
data to analyze personal experiences in the context of the research area of the respondents (Creswell, 2013).
2020 The International Journal of Business and Management Research, Vol.13 Number 1
37
3.3. Secondary data collection method
The secondary data collection method also played a supportive role in the triangulation process of data analysis. It
helped in considering the views of other researchers and scholarly work done on the topic (Bergh and Ketchen, 2009;
Bryman, 2015). Thus, secondary data was highly valuable to compare research approach, methodology and analysis.
Secondary data has been collected from a variety of sources including, report, and peer reviewed scholarly work
published in academic journals. These sources have been incorporated in the literature review segment of the study. It
has helped in formulating a strong theoretical base in the context of use social media marketing tools and its impact on
the development of small business enterprises. This method helped in getting further insight into the conceptual
information that was pre-processed for obtaining a precise, informative conclusion.
3.4. Access to Primary and Secondary Data
The research study has followed an integrated triangulation approach by gathering qualitative, as well as quantitative
information pertaining to research subject for making it an informative source for future researchers and readers (Flick,
2015). In the effort to acquire pertinent secondary information, scholarly articles and academic books were reviewed
for procuring significant information on the significance of marketing through social media platforms done by small
companies of Bournemouth. These diverse literature sources were referred for eliminating any authenticity related
issues in the research that might arise due to the reliance on a single information source only. Therefore, for
accomplishing the purpose of obtaining secondary information, archival records were investigated that illustrated the
advantages of suing social media platforms for accelerating the growth of small businesses in Bournemouth. On the
other hand, collecting first-hand information; a visit to small companies in Bournemouth was made, with the purpose
of research was discussed with. Additionally, emails and contact numbers of managers were collected from
administrators. Managers were contacted then, to informing them regarding needed contribution for research purpose.
Further, instructions were given to them regarding the questionnaire and their free consent was also taken. Once all
initial requirements have been fulfilled, a survey questionnaire were mailed to managers of small firms operating in
Bournemouth city, requesting them to participate in the questionnaires.
3.5. Sampling Technique and Sample size
The population from which sample has been drawn includes managers of small business enterprises operating in
Bournemouth. Sample drawn consisted of 25 managers of small companies in the city of Bournemouth. It is an
appropriate sample size for gauging the perception of the population (managers involved in the marketing function)
regarding the significance of social media marketing in encouraging the development of small businesses in
Bournemouth. The perspectives of this population will be important and aligned with the research subject. Random
sampling technique has been used for selecting a sample for ensuring that the results are not influenced by any bias
attitude (Crowther and Lancaster, 2012).
3.6. Conceptual Framework
The literature review resulted in the conceptual framework shown below, which is adequate for achieving the research
subjects. The conceptual framework encompasses a systematic evaluation of major themes developed in accordance
with research question, aim and objectives. In this context, the principal theme is the impact of social media marketing
and its contribution to growth and development of small businesses in the U.K. The variables that constitute sub-themes
are profitability, customer loyalty, customer retention, brand promotion and competitive advantage. Systematic
examination of the main theme along with important variables helped in deriving relevant information in more detail
to answer research subject.
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
38
Figure 1: Conceptual Framework
4. Result and discussion
Amongst a total of 25 respondents (managers), 10 respondents had an experience of 0-5 years. It was observed that a
total of 5 respondents had a work experience of 6-10 years. Further, 5 respondents possessed an experience of 11-15
years and 5 respondents possessed an experience of more than 15 years. It reflects that a majority of managers possessed
a work experience of 0-5 years in the small-scale companies located in Bournemouth. The total of 25 managers who
were asked about their involvement in the social media activities, a total of 60% mentioned that they were actively
engaged in one form or another of social media activities. In addition, it was observed that a total of 40% managers
were directly involved in social media activities of their company.
Amongst the total respondents who were asked about the type of social media platform for the purpose of their
promotional and marketing activities, 32% respondents mentioned that they use Facebook and Twitter as a platform
for their marketing activities. In addition to this, only 8% respondents mentioned that they use LinkedIn for their
promotional activities. Further, 20% respondents mentioned that they use the platform of YouTube for the purpose of
their marketing activities along with 20% respondents who mentioned that they use Instagram for marketing. Also,
20% respondents mentioned that they are using WhatsApp as a medium to promote their products and services. Out of
the total of 25 respondents who were asked about the regularity of their engagement in social media marketing, 40%
respondents mentioned that they were engaged in the social media marketing on a daily basis. In addition to this, a total
of 40% respondents were involved in the social media marketing strategies on a weekly basis. The results further depict
that a total of 20% respondents were involved in the activities of social media marketing on a monthly basis.
When managers of small business were asked "does social media marketing helps in generating revenues with social
marketing practices", the majority of the respondents (18) replied ‘Yes', whereas 7 replied ‘No' in response to the same.
This has indicated that managers experience positive growth in revenues with the implementation of social media
strategy. As for the question related to the contribution of social media to the company's revenues, a question was asked
Impact of Social
Media Marketing
for the
Development of
Small Businesses
Key practices of social
media marketing
Social media marketing
tools (Facebook.
Twitter, WordPress)
Increases profitability
Competitive advantage
Customer Retention
Customer Loyalty
Assists in Customer
Relationship
Management
Brand Promotion
2020 The International Journal of Business and Management Research, Vol.13 Number 1
39
in sequence to managers "Is social media marketing supporting the growth of company's business?" In response to this
question, it has identified that 22 managers replied ‘Yes. The remaining 3 managers replied ‘No' in response to the
question. Managers, who are in favor of social media marketing that supports business growth, stated that social media
marketing helps in stimulating familiarity of their business across the city and beyond, since people at distant locations
are able to be communicated with. Managers have stated that social media has given exposure to reach to wider masses
across the U.K. and beyond the city parameters.
Amongst total of 25 managers who were asked about the significance of promotion of their company through the use
of social media marketing, 80% of managers mentioned that they find it easy to promote their company through the
use of social media marketing. Furthermore, 20% of managers stated that they do not find it easy to promote their
company through the use of social media platform. Results shows that a majority of managers find it easier in promoting
their businesses through social media marketing. The next question is related to the advantages of incorporating social
media marketing for ensuring sustainable business development. This question has provided clear information about
the role of social media in ensuring the development of business. Out of the total sample size of 25 managers, 15
managers were replied ‘all of the above' options that use of social media not only helps in single aspect, while it has
wider implications for brand promotion to the profitability growth. However, 7 managers believed that brand promotion
is the major advantage of incorporating social media marketing for ensuring sustainable business development. Out of
the remaining respondents, 2 managers consider the role of managers in the context of business development in respect
of attaining competitive advantage. 1 manager replied that profitability increment is the advantage of incorporating
social media marketing for sustainable business development
In specifics to the location of Bournemouth, managers were asked to state if there is any correlation between social
media marketing and brand awareness, customer loyalty and profitability for the development of small businesses
functioning. The majority of the respondents were strongly agreed (14), and 7 respondents agreed with the relationship.
Out of the remaining eight managers, 3 were neutral in their response that does not state any positive or negative
correlation between variables. However, one manager disagreed that there is no correlation persisted between social
media and business-related variables and ultimate relationship with the development of the business functioning. The
last open-ended question was asked about social media marketing appropriateness for supporting the continual
development of small business operating in Bournemouth. The majority of managers were replied social media is the
platform for communication with wider customers' base and considered an effective means of promoting business.
Open-ended answered revealed that social media helps in brand building through product and service promotion across
all social media platforms, such as Blogs, YouTube, Facebook, Twitter, Instagram and Pinterest. The low cost of
advertisement emerged as another reason for choosing social media marketing, that helped control cost. Some mangers
stated the benefit of social media for making relationship with current and prospective customers. Adding that social
media significantly contributes towards promotion of products and services, branding and creation of awareness.
Findings further shows that managers are increasingly engaging in social media marketing activities on a regular basis
as they master the process. This research further found that the use of social media marketing strategies helps companies
in wider Bournemouth area that, the use of social media platform helps businesses better understanding the needs and
preferences of their customers. This helps managers to modify products and decimate information across social media
platforms to execute organizational content distribution plans. Findings further suggest that an increasing engagement
by managers is considered as an increasingly significant component of the marketing and branding strategy of the
companies to enhance brand value. This supports the findings of Hennig-Thurau, Hofacker and Bloching (2013).
Positive correlations allow to confer that engagement in social media marketing activities provides significant
advantages in customer loyalty, customer retention, pricing competitive advantages and contribution to profitability.
References
Aaker, D.A., Kumar, V. and Day, G.S. 2008. Marketing research. New Jersey: John Wiley & Sons.
Ashley, C. and Tuten, T. 2015. Creative strategies in social media marketing: An exploratory study of branded social content and consumer
engagement. Psychology & Marketing 32(1), pp. 15-27.
Bergh, D.D. and Ketchen, D.J. 2009.Research Methodology in Strategy and Management. Emerald Group Publishing.
Boone, L.E. and Kurtz, D.L. 2013. Contemporary marketing. Boston: Cengage learning.
Bryman, A. 2015. Social research methods. Oxford: Oxford university press.
Carneiro, I.A. 2016. The Information Age. Clube de Autores.
Chou, C.M. 2014. Social Media Characteristics, Customer Relationship and Brand Equity. The Journal of Applied Business and Economics 16(1),
pp.128.
Chu, S.C. and Kim, Y. 2011. Determinants of consumer engagement in electronic word-of-mouth (eWOM) in social networking sites.
International journal of Advertising, 30(1), pp.47-75.
Cohen, L., Manion, L. and Morrison, K. 2007. Research Methods in Education. London: Routledge.
Creswell, J.W. 2013. Research design: Qualitative, quantitative, and mixed methods approaches. California: Sage publications.
Crowther, D. and Lancaster, G. 2012. Research Methods. London: Routledge.
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
40
Dahnil, M. I., Marzuki, K. M., Langgat, J. and Fabeil, N. F. 2014. Factors influencing SMEs adoption of social media marketing. Procedia-Social
and Behavioral Sciences 148, pp.119-126.
Davila, T. and Epstein, M. 2014. The innovation paradox: Why good businesses kill breakthroughs and how they can change. Berrett-Koehler
Publishers.
Denscombe, M. 2012. The Good Research Guide: For Small-Scale Social Research Projects. New York: McGraw-Hill International.
Dessart, L., Veloutsou, C. and Morgan-Thomas, A. 2015. Consumer engagement in online brand communities: a social media perspective. Journal
of Product & Brand Management 24(1), pp. 28-42.
Farris, P., Bendle, N., Pfeifer, P. and Reibstein, D. 2015. Marketing Metrics: The Manager's Guide to Measuring Marketing Performance. FT
Press.
Flick, U. 2015. Introducing research methodology: A beginner's guide to doing a research project. California: Sage.
Grant, R.M. 2016. Contemporary strategy analysis: Text and cases edition. New Jersey: John Wiley & Sons.
Gratton, C. and Jones, I. 2010. Research Methods for Sports Studies. Taylor & Francis.
Hanna, R., Rohm, A. and Crittenden, V.L. 2011. We’re all connected: The power of the social media ecosystem. Business horizons 54(3), pp.265-
273.
Hays, S., Page, S.J. and Buhalis, D. 2013. Social media as a destination marketing tool: its use by national tourism organisations. Current issues in
Tourism 16(3), pp.211-239.
Hays, S., Page, S.J. and Buhalis, D. 2013. Social media as a destination marketing tool: its use by national tourism organisations. Current issues in
Tourism 16(3), pp.211-239.
Hennig-Thurau, T., Hofacker, C.F. and Bloching, B. 2013. Marketing the pinball way: understanding how social media change the generation of
value for consumers and companies. Journal of Interactive Marketing 27(4), pp. 237-241.
Hollensen, S. 2015. Marketing management: A relationship approach. London: Pearson Education.
Hudson, S. and Thal, K. 2013. The impact of social media on the consumer decision process: Implications for tourism marketing. Journal of Travel
& Tourism Marketing 30(1-2), pp.156-160.
Ioanăs, E. and Stoica, I. 2014. Social Media and its Impact on Consumers Behavior. International Journal of Economic Practices and Theories 4
(2). pp. 295-303.
Jussila, J.J., Kärkkäinen, H. and Aramo-Immonen, H. 2014. Social media utilization in business-to-business relationships of technology industry
firms. Computers in Human Behavior 30, pp. 606-613.
Kietzmann, J.H., Hermkens, K., McCarthy, I.P. and Silvestre, B.S. 2011. Social media? Get serious! Understanding the functional building blocks
of social media. Business horizons 54(3), pp.241-251.
Kim, K.S., Sin, S.C.J. and Tsai, T.I. 2014. Individual differences in social media use for information seeking. The Journal of Academic
Librarianship 40(2), pp. 171-178.
Lamberton, C. and Stephen, A.T. 2016. A Thematic Exploration of Digital, Social Media, and Mobile Marketing: Research Evolution from 2000 to
2015 and an Agenda for Future Inquiry. Journal of Marketing 80(6), pp.146-172.
Malone, C. and Fiske, S.T. 2013. The human brand: How we relate to people, products, and companies. New Jersey: John Wiley & Sons.
Manhas, K.P. and Oberle, K. 2015. The ethics of metaphor as a research tool. Research Ethics 11(1), pp.42-51.
Napoli, P.M. 2011. Audience evolution: New technologies and the transformation of media audiences. Columbia University Press.
Neti, S. 2011. Social media and its role in marketing. International Journal of Enterprise Computing and Business Systems 1(2), pp.1-15.
Peppers, D. and Rogers, M. 2016. Managing Customer Experience and Relationships: A Strategic Framework. John Wiley & Sons.
Powell, G., Groves, S. and Dimos, J. 2011. ROI of Social Media: How to improve the return on your social marketing investment. New Jersey:
John Wiley & Sons.
Poynter, R. 2010. The handbook of online and social media research: Tools and techniques for market researchers. New York: John Wiley &
Sons.
Ryan, D. 2016. Understanding digital marketing: marketing strategies for engaging the digital generation. Kogan Page Publishers.
Safko, L. 2010. The social media bible: tactics, tools, and strategies for business success. New York: John Wiley & Sons.
Schivinski, B. and Dabrowski, D. 2016. The effect of social media communication on consumer perceptions of brands. Journal of Marketing
Communications 22(2), pp.189-214.
Scott, D.M. 2007. The New Rules of Marketing. New Jersey: John Wiley and Sons.
Scott, D.M. 2015. The new rules of marketing and PR: How to use social media, online video, mobile applications, blogs, news releases, and viral
marketing to reach buyers directly. John Wiley & Sons.
Sigala, M., Christou, E. and Gretzel, U. 2012. Social media in travel, tourism and hospitality: Theory, practice and cases. London: Ashgate
Publishing, Ltd..
Smith, G.E. 2015. The Opt-Out Effect: Marketing Strategies that Empower Consumers and Win Customer-Driven Brand Loyalty. FT Press.
Smith, J.A. 2015. Qualitative psychology: A practical guide to research methods. California: Sage.
Smith, W.R. and Vardiabasis, D. 2010. Using social media as a competitive advantage: the case of small businesses. Problems and Perspectives in
Management 8(4), pp. 193-197.
Strauss, J. 2016. E-marketing. London: Routledge.
Taylor, S.J., Bogdan, R. and DeVault, M. 2015. Introduction to qualitative research methods: A guidebook and resource. New Jersey: John Wiley
& Sons.
Tiago, M.T.P.M.B. and Veríssimo, J.M.C. 2014. Digital marketing and social media: Why bother?. Business Horizons 57(6), pp. 703-708.
Towner, E.B. and Everett, H.L. 2016. Technical Marketing Communication: A Guide to Writing, Design, and Delivery. Business Expert Press.
Trusov, M., Bucklin, R.E. and Pauwels, K. 2009. Effects of word-of-mouth versus traditional marketing: findings from an internet social
networking site. Journal of marketing 73(5), pp.90-102.
Turban, E., King, D., Lee, J.K., Liang, T.P. and Turban, D.C. 2015. Electronic commerce: A managerial and social networks perspective. New
York: Springer.
Tuten, T. L. and Solomon, M. R. 2014. Social media marketing. London: Sage.
Walker, S. 2014. Social Media Marketing Tips: Essential Strategy Advice and Tips for Business Facebook, Twitter, Google+, YouTube, LinkedIn,
Instagram and Much More!. CreateSpace Independent Publishing Platform.
Williams, J. and Chinn, S.J. 2010. Meeting relationship-marketing goals through social media: A conceptual model for sport marketers.
International Journal of Sport Communication 3(4), pp.422-437.
Wilson, T. 2016. International Responses to Issues of Credit and Over-indebtedness in the Wake of Crisis. London: Routledge.
2020 The International Journal of Business and Management Research, Vol.13 Number 1
41
Yin, R.K. 2013. Case study research: Design and methods. California: Sage publications
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
42
Cash flow and corporate financial performance of listed
conglomerate companies in Nigeria
Aminatu Sani Mohammed
Aminu Saleh College of Education Azare, PMB 044, Azare, Bauchi State Nigeria
aminasanimohammed@gmail.com
Abstract
The study examines the relationship between cash flow and corporate financial performance of listed conglomerate companies in
Nigeria. It utilized documentary data collected from annual reports and accounts of the sampled companies for the periods 2005 –
2014. Data was analyzed by means of correlation analysis using Pearson correlation The results of the study revealed a strong
positive and significant impact of Cash Flow from Investing and Financing activities on corporate financial performance proxied by
ROA, while Cash Flow from Operating activities has a positive and insignificant impact on financial performance proxied by ROA
of the listed conglomerate companies in Nigeria. It was also found that Cash flow from Operating, Investing and Financing activities
have a positive and significant impact on corporate financial performance (ROE) of listed Conglomerate companies in Nigeria. The
study recommends that although increasing financial leverage reduces agency cost associated with equity, Listed Conglomerate
companies in Nigeria should not rely more on financial leverage because excessive leverage has a negative impact on financial
performance.
Keywords: Cash flow, Operating, Investing. Financing and Financial Performance
1.1 Introduction
The economic well-being of any business in production or in servicing depends on careful monitoring and management
of the flow of cash within and outside that organization. Cash is a vital component of any business and required effective
management because even profitable businesses can go bankrupt when they failed to manage their cash effectively,
particularly when they operate in rapid-growth or seasonal industries (BDBC, 2014) and without which a business may
not survive. Cash flow statement being one of the main financial statements is required to be published by a company,
it entails information on cash receipts and payments during the fiscal year and it helps users in predicting future cash
flow. According to International Accounting Standard (IAS) 7 the cash flow statement is categorized into 3 major
classes - Operating cash flow which measures a company’s ability to generate cash from its day to day activities;
investing cash flow captures the changes in a company’s investments, that is it reflects how an organization cash is
used to provide securities such as acquiring properties, equipments, making capital expenditures and to expand and
financing cash flow examines how a company finances its endeavors and how it rewards its shareholders through the
payment of dividend.
Corporate financial performance measures the results of a firm’s policies and operations in monetary terms. These
results are reflected in the firm’s return on investment, return on assets, return on equity and value added among others
and the performance objectives are that an enterprise must generate sufficient cash through operating, investing, and
financing activities (Needle, Powers & Cross, 2007). Reinforcing this, Uremadu (2004) and Firend and Shaki (2008)
maintained that a business firm should be able to devise various ways for selecting components of its cash flow which
would be used in the company’s operation to raise its productivity or achieve performance. According to Turcas (2011)
performance assessment is one of the most important financial problems in a company as a result of using different
financial resources and methods to carry out profitable projects so as to achieve maximum return for their shareholders.
A firm being profitable does not mean the firm is solvent due to the fact that profit is not cash. The solvency, flexibility
and financial performance of a firm are set on the firm’s ability to generate positive cash flow from its operating,
investing and financing activities. It therefore becomes important to understand the extent to which cash flow impact
on the financial performance of companies.
Firms use different financial resources and methods to carry out profitable projects so as to achieve maximum return
for their stockholders and the ability of a company to determine internal and external resources of an organization,
supply capital and prepare financial plan is important for its growth and development. A firm being profitable does not
2020 The International Journal of Business and Management Research, Vol.13 Number 1
43
mean the firm is also solvent due to the fact that profit is not cash. According to Turcas (2011) the solvency, flexibility
and the financial performance of the firm are set on the firm’s ability to generate positive cash flows from the operating,
investing and financing activities. Hence, inadequate cash flow planning with regards to investing activities it will have
a negative impact on the financial performance by lowing cash inflow and increasing cash outflow. Likewise, business’
inability to secure necessary financing from banks and other creditors’, as well as the timing of ongoing loan or other
credit account payment, may undercut a business financial performance when there is absence of borrowing power
reducing the business cash inflow and a surge in payment due in a particular period increases the cash outflow. It
therefore becomes important for companies to understand the relationship that exists between their cash flow and
financial performance so as to develop a suitable cash flow mix in order to maximize shareholders values. Managers
also have a tendency to hold large proportion of firm assets in the form of cash and cash equivalents in order to reinvest
on other physical assets, make payments to stockholders and to retain some in the firm. Apparently they do not invest
cash to the advantage of shareholders rather they hold it in pursuit of negative NPV projects for their benefits and
according to agency theory, the conflicts of interest between shareholders and managers over payout policies are
especially server when the organization generates substantial cash.
Several studies have revealed that the relationship between cash flow and corporate financial performance ranges from
negatively significant (Ashiani, 2005; Watson, 2005; Zhou et al 2012; Ali et al 2013; Thanh & Nguyen; Chikashi, 2013;
Heydari et al 2014) to positively significant (Miar. 1995; Brush, et al 2000; Shahmordi, 2002; Adelegan, 2003;
Khoshdel, 2006; Mong’o, 2010; Guda; Velnampy & Kajananthan, 2013; Frank and James, 2014; Nwanyanwu;
Ghanbari et al 2015). This is due to different research methodology, different conceptualizations and
operationalizations of variables, and different nature of sectors of studies. Most of these studies are conducted in
various sectors and economies of the world, with few conducted in Nigeria such as Frank and James (2014) Food and
Beverages companies, Nwanyanwu (2015) Hospitality and Printing media and Amah, Michael and Ihendinihu (2016)
Banking sector. The study of Frank and James (2014) covers only a sub section of manufacturing companies listed in
the Nigerian Stock Exchange for the period of 5yrs. These years are considered to be inadequate to draw a conclusion
as a result of the samples size, the study of Nwanyanwu (2015) covers Small and Medium Hospitality and Printing
Medias using only Net Profit as a proxy for performance while the study of Amah, Michael and Ihendinihu (2016)
cover only four banks listed out of the eleven listed in the Nigerian stock exchange using Net profit as a proxy for
performance for the period of nine years. Therefore, this study uses two measures of financial performance: Return on
Assets and Return on Equity and extends the study period to ten years. In addition, none of these studies were conducted
in the listed Conglomerate Companies in Nigeria. It is in this regard that the present study aims to carry out the study
on the relationship between cash flow and corporate financial performances of listed conglomerate companies in
Nigeria for the period of 10 years (i.e. 2005-2014).
This paper therefore is aimed at examining the impact of cash flow on corporate financial performance of listed
Conglomerate companies in Nigeria and it consist of five sections, section 1 is an introduction, section 2 reviews
literature on cash flow and corporate financial performance Section 3 explains the methodology for the study, section
4 presents and discusses the result of the study and finally, section 5 deals with the conclusion and recommendations
for the study.
2.0 Theoretical and literature review
This study is informed on the basis of several theoretical frameworks that cash flow affects corporate performance and
the extent or degree to the effect depend on operating policy, investment policy and financing policy adopted by the
company. The theory that emerged and presented a clear direction and firm’s behaviour about cash flow (Net cash
generated from operating, investing and financing activities) is Agency cost.
Companies conduct different strategies for survival and developing their activities. One of these activities is attempting
to decrease firms’ expenses. According to the agency theory, agency conflicts arise from the possible divergence of
interest between shareholders and managers of firms. The primary duty of managers is to manage the firm in such a
way that it generates returns to shareholders thereby increasing the profit figures and cash flows (Elliot & Elliot, 2002).
According to Gul et al (2012), agency costs can be reinforced in different ways; such as advantageous behaviour from
a number of managers who focus on increasing their own power or position, extra consuming from the obtained
incomes, ineffective investment decisions and mismanagement in accounting or frauds in firm’s business contracts.
Negative consequences of these actions emerge as destroying stock holders’ assets and properties and also the
performance. Murphy (1985) argued that managers tend to increase the size of companies even if it harms the interest
of shareholders, as quite often their remuneration and prestige are positively correlated with company size, while
according to Boodhoo (2009), the contribution of agency theory is that leverage firms are better for shareholders as
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
44
debt level can be used for monitoring the managers. Thus, higher leverage is expected to lower agency costs, reduce
inefficiency and thereby lead to improvement in corporate performance (Akintoye, 2008). Agency theory therefore
examines how management’s behaviour could be directed at stockholder’s interest by reducing agency cost to increase
financial performance. Amah, Micheal and Ihendinihu (2016) examined the relationship between cash flow and
financial performance of listed banks in Nigeria. The study sampled four banks listed in the NSE for the period of 9
years (2005 - 2013). Data collected were subjected to statistical analysis using correlation. Net profit as performance
proxy was used and the study revealed that cash flow from operating activities has a significant and strong relationship
while cash flow from investing and financing activities has negative and weak relationship with performance of the
sampled banks.
Ghanbari, et al (2015) conducted an investigation of cash flows’ effect and financial performance of companies listed
in Tehran Stock Exchange. Data from 183 companies were collected for the period 2009 – 2013 using statistical features
such as efficiency, mean, standard deviation and regression analysis test, Student t test and Fisher F test to analyze on
ROA as the dependent variable and Accounting cash flow (ACF), Equity Cash Flow (ECF), Free Cash Flow (FCF) and
Capital Cash Flow (CCF) as the independent variables. The researchers found that there is a meaningful relation
between accounting cash flow, equity cash flow, free cash flow, capital cash flow with financial performance of listed
companies in Tehran Stock Exchange. In Nigeria, Nwanyanwu (2015) carried out a study on cash flow and
organizational performance of Nigerian Hospitality and Print Media using 45 small and medium enterprises from the
two sectors. Data were collected and analyses were done through the means of descriptive statistic and Pearson product
moment coefficient of correlations using SPSS. Variables of the study were Net Profit as the dependent variable and
cash flow from operating activity as the independent variable. The result indicated that a significant strong positive
relationship between cash flow position and net profit. Consequently, cash flow position determines the extent of net
profit performance of organizations in the hospitality and print media.
Further, Frank and James (2014) examined the relationship between cash flow and corporate performance in the food
and Beverages sector of Nigeria. Data used were obtained from the Nigerian Stock Exchange for the period 2007 –
2011 and were analyzed using multiple regression technique. Return on Assets (ROA) represents the dependent
variable and the three cash flow components as the independent variables. The study found that Operating and
Financing Cash flow have significant positive relationship with corporate performance while investing cash flow and
corporate performance have significant negative relationship. Heydari, et al (2014) investigated the relationship
between free cash flow and performance of listed firms on Tehran Stock Exchange. Data obtained for the study covering
a period from 2006 – 2012 were analyzed using correlative regression on Return on Assets (ROA), Return on Equity
(ROE), Tobin’s Q and Stock return as the dependent variables and free cash flow as the independent variable. They
found that there is a negative relationship between free cash flow with all evaluative factors of performance. It also
revealed an increase in the conflict of interest between managers and property owners due to free cash flow which leads
to decrease in the firms’ performance.
Tariverdi, Amanolahi and Faal (2014) also conducted a study on the effects of components of a 4 part model of cash
flow statement on operational performance of listed Tehran Stock Exchange. All firms enlisted in the Stock Exchange
were included in a time range of 5 years from 2007 – 2011. The DVs ROA and ROE and IVs, Cash flows resulting
from investments' return (CFIR), Cash flows resulting from interest paid for financing (SF), Cash flows of investment
(CFI) and Cash flows of financing (CFF) were analysed using Pearson correlation. The study revealed that there is
positive relationship between CFIR and ROA and ROE, a negative relationship between SF and ROE and ROE and no
meaningful relation between CFI, CFF and ROA and ROE. In Nairobi, Ojode (2014) studied the effect of free cash
flow on profitability of firms listed for the period 2009 – 2013 on 30 sampled firms. Using Pearson correlations on
data revealed that there is a strong negative relationship between free cash flow and profitability of listed firms.
Also, Gheshlaghi, Ahamdzadeh and Faal (2014) carried out a research on the cash flow statement component effect on
management performance using 138 firms listed on the Tehran Stock Exchange for the period of 5 years, 2008 – 2012.
Using multiple linear regression on the variables Return on Assets (ROA) and Return on Equity (ROE) as performance
measures and the independent variables Cash flow from Financing activities (CFF), Cash flow from Investing
activities (CFI), Cash flow from Operating activities( CFO) and Cash flow from Return on Investment and Interest paid
to finance (CFRI&SF). The research finding shows that there is negative relationship between cash flows from
investments activities and return on assets. Also, there is no relationship between cash flows from operational activities
and financing activities and return on assets.
Thanh and Nguyen (2013) examined the effect of banking relationship on firm performance, using a sample of 465
companies listed on Vietnam Stock Exchange for the period 2007 - 2010. They used multiple regressions to analyze
2020 The International Journal of Business and Management Research, Vol.13 Number 1
45
data and the result, among others shows that cash flow has negative relationship with firms return on equity. An
investigation of comprehensive income and firm performance a case of electric appliances industry of Tokyo Stock
Exchange was carried out by Chikashi (2013) for the period 2009 – 2011. Data obtained were analyzed using pool
regression and the study revealed that cash flow and firm performance have a significant negative relationship. In
addition, comprehensive incomes published by the firms were superior to other earnings or cash flow variables in
predicting the future stock value. In another research conducted by Velnampy and Kajananthan (2013) on cash position
and profitability among listed Telecommunication firms in Sri Lanka over a period of seven years, from 2005 - 2011.
Data from two firms were analyzed using Pearson correlation analysis and the researchers found out that there is
significant relationship between cash position ratio and Return on assets (ROA) and Return on equity (ROE) in one
firm and in the other there was no significant relationship between the cash position ratio and ROA and ROE. Galogah,
Pouraghajan and Makrani (2013) investigated on the relationship between free cash flow and stock return using listed
firms on the Tehran Stock Exchange for the period 2006 – 2011. Samples of 140 companies were used and data
collected on dependent variable, Stock returns (R) and the independent variable free cash flow (FCF) were analyzed
using multivariate regression model. The result indicated that there is a negative relationship between the company’s
free cash flow and common stock return.
A study on the relationship between cash flow and profitability of small and medium enterprise in Nairobi was
conducted by Guda (2013) for the period 2008 – 2012. A descriptive study was applied in this study using primary data
obtained from individual small and medium enterprise firms. The data was organized into a panel, analyzed using a
fixed effect regression model to obtain coefficients of the variables. The study revealed that there is a significant
relationship between profitability and cash flow. Zhou, et al (2012) examined the relationship between free cash flow
and financial performance of listed Real Estate Companies in China. Principal component analysis and regression
analysis on data from 2006 – 2011 were used. The study revealed that there is a significant negative relationship
between free cash flow and financial performance of companies. Thus, according to their results, free cash flow leads
to reduce financial performance of companies because excess cash flow is not conducive to the company’s financial
performance as a result of the problems associated with agency costs of free cash flow.
Mong’o (2010) analyzed the impact of cash flow on profitability among commercial banks in Kenya over the period
from 2005- 2009. It was specifically conducted to explain the influence that various components of cash flows have on
profitability growth. Multiple regression models were used to analyze the data and the findings of the study indicate
that Cash flow from the financing and the investing activities have a great positive influence on the banks’ profit while
operating cash flow has a negative effect. From the empirical studies reviewed it has been found that there is no
consistency in the use of variable, sector and economy thereby resulting to diversified outcome. The studies of Frank
and James (2014) and Ghanbari et al (2015) have used ROA; Nwanyanwu (2015); Mongo (2010), Guda (2013) and
Amah, Micheal and Ihendininhu (2016) have used NP; Tariverdi, Amanolahi and Faal (2014); Gheshlaghi,
Ahmadzadeh and Faal (2014), Velnampy and Kajananthan (2013) have used ROA and ROE; Ojode (2014) have used
ROCE; and Galogah, Pouaghajan and Makrani (2013) have used SR and Hydari et al (2014) have used ROA, ROE,
SR and Tobin’s q as measures of financial performance. The studies of Hydari et al (2014); Ojode (2014); and Galogah,
Pouaghajan and Makrani (2013) have used the three cash flow components in their studies of Free cash flow and
profitability.
The studies of Frank and James (2014); Nwanyanwu (2015); Ghanbari et al (2015) and Amah, Micheal and Ihendinihu
(2016) have found that cash flow from operating activities and financial performance have a significant positive
relationship while the studies of Mongo (2010), Guda (2013) and Gheshlaghi, Ahmadzadeh and Faal (2014) found that
the relationship between cash flow from operating activities and financial performance is significantly negative. Cash
flow from investing activities has a significant relationship with financial performance in the studies of Ghanbari et al
(2015), Guda (2013) and Mongo (2010), while in the studies of Frank and James (2014), Gheshlaghi, Ahmadzadeh and
Faal (2014) and Amah, Micheal and Ihendinihu (2016) the relationship is negative. The relationship between the cash
flow from financing activities and financial performance is positive according to the studies of Mongo (2010), Guda
(2013) and Frank and James (2014) while according to Ghanbari et al (2015) and Amah, Micheal and Ihendinihu (2016)
it is negatively related. The difference in the outcome of these studies is as a result of the sectors and economies of the
study. Mong’o (2010) and Amah, Micheal and Ihendinihu (2016) studies were conducted on the Banking sector in
Kenya and Nigeria respectively while that of Nwanyanwu (2015) and Guda (2013) were on Small and medium
Enterprises in Nigeria and Nairobi respectively. Ghanbari et al (2015) opined that cash flow can decrease the risk
related to operations thereby leading to an increase of companies’ performance and Guda (2013) opined that a company
generating healthy cash balances will invariably have a high financial performance. Hence, cash flow is absolutely
critical for the existence and survival of an organization.
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
46
3.0 Research Methodology
This section explains the research design, population of the study, sample size and sampling technique, sources and
methods of data collection, techniques of data analysis, variables of the study and their measurements as well as the
model specification.
Ex-post facto design was used for this study owing to the fact that the study utilizes the annual reports and accounts of
sampled firms. The relationship between cash flow and corporate financial performance was explored, with cash flow
as independent variable and corporate financial performance as the dependent variable.
3.1 Population and Sample Size
The population of the study is made up of all listed Conglomerate companies in the Nigerian Stock Exchange, and their
years of listing and incorporations are as follows:
Table 1: Population of the Study
S/N
COMPANY NAME
YEAR OF INCORP.
YEAR OF LISTING
1
A.G. Leventis Nigeria Plc
1958
1978
2
Chellarams Plc
1947
1977
3
John Holt Plc
1961
1974
4
SCOA Nigeria Plc
1969
1977
5
Transnational Corporation Nigeria Plc
2004
2006
6
UAC of Nigeria Plc
1931
1974
Source: Generated by the researcher from the NSE 2013/2014 Fact book
Table 1 shows the total population of the study, out of which the sample population was drawn and the criteria for
choosing this population was based on two criteria. First is the year of companies listing which should be at least 31/12/
2004 and secondly, the availability of data from 2005 – 2014. All companies met these criteria with the exception of
Transnational Corporation Nigeria Plc due to unavailability of data. The five (5) companies that emerged were used as
sample size for the study, thereby making sampling unnecessary
3.2 Data Collection and Techniques of Data Analysis
Data was extracted from the annual reports and accounts of the sampled companies from 2005 - 2014 which were used
for the computation of ratios on cash flow and corporate financial performance and in analyzing the relationship
between Cash flow measures and corporate financial performance, the study employed Descriptive statistics, Pearson
correlation coefficient and multivariate regressions as adopted by Pouraghajan et al (2013); Velnampy and Kajananthan
(2013); Guda (2013); Tariverdi, Amanolahi and Faal (2014) and Gheslaghi, Ahmadzadeh and Faal (2014). A robustness
test was conducted in order to improve the validity of all statistical inferences for the study. The tests include
Multicollinearity, Heteroskedasticity, Normality and Hausman specification test.
3.3 Study Variables and their measurements
The variables in the research were divided into 3 groups: Dependent variables which are Return on assets (ROA) and
Return on equity (ROE); the Independent variables are Cash flow from Operating activities (CFO); Cash flow from
investing activities (CFI) and Cash flow from financing activities (CFF) and the control variables are Firm Size (Size)
and Financial Leverage (FL). The summary of the study variables and their measurements are shown below:
Table 2: Summary of Variables and their Definitions
Variables
Symbols
Variables definitions
Return on Assets
ROA
Before Tax Net Profit divided by Total
Assetsit
Dependent
Return on Equity
ROE
Net Profit after Tax divided by Equity
Dependent
Cash Flow from Operations
CFO
Net cash flow from Operating activities of
firmi in the yeart divided by cash and cash
equivalent ending
Independent
2020 The International Journal of Business and Management Research, Vol.13 Number 1
47
Cash Flow from Investing
CFI
Net cash flow from Investing activities of
firmi in the yeart divided by cash and cash
equivalent ending
Independent
Cash Flow from Financing
CFF
Net cash flow from financing activities of
firmi in the yeart divided by cash and cash
equivalent ending
Independent
Size
SIZE
Natural Logarithm of Total Assets
Control
Financial Leverage
FL
Total Liabilities divided by Total Assets
Control
Source: Developed by the Researcher from literature viewed.
3.4. Regression model of the research
Model 1
ROAit = β0 + β1 CFOit + β2 CFIit + β3 CFFit + β4 SIZEit + β5 FLit + Uit………....1
Model 2
ROEit = β0 + β1 CFOit + β2 CFIit + β3 CFFit + β4 SIZEit + β5F Lit + Uit………….2
β0 is the constant coefficient (the intercept) β1. . . . . β5 is the coefficient of the independent and control variables. This
co-efficient of the explanatory variables (β1 . . . . . β5) can be estimated by the use of General Least Square technique.
Panel data was adopted in this study. This combines simultaneously cross section and time series data. The Model
adopted in this research study is in line but with slight modification with that of Wang (2010); Pouraghajan et al (2013);
Guda (2013); Velnampy and Kajananthan (2013); Heydari et al (2014); Tariverdi, Amanolahi and Faal (2014) and
Gheslaghi, Ahmadzadeh and Faal (2014).
4.0 Results and discussion
4.1. Descriptive Statistics
Table 4.1 provides summary statistics for the variables of the study. The summary statistics include, among others, the
mean as the measure of central tendency and the measure of standard deviation as a measure of dispersion. These were
computed from the statement of financial position and income statements of the sampled companies.
Table 4.1: Descriptive Statistics of the Variables
VARIABLE
MEAN
STD. DEV.
MIN
MAX
ROA
0.058
0.124
-0.422
0.380
ROE
- 0.032
2.099
-14.216
2.731
CFO
1.776
8.543
-6.902
54.500
CFI
1.159
3.525
-3.501
19.989
CFF
-1.964
6.715
-30.200
4.672
SIZE
6.955
0.284
6.500
7.423
FL
0.524
0.254
0.152
0.993
Source: Generated by the Researcher from the Annual Reports and Accounts of the sampled companies (2016) using Stata (Version 11)
Table 4.1 presents the descriptive statistics of dependent and independent variables of the study. The Table shows the
mean, standard deviation, minimum and maximum value. The mean ROA of the sample firm is 6% while that of the
ROE is 3%. This result indicates that for every N100 worth of total assets employed an average of N6 was earned and
a maximum of N38 as before tax profit, while an average of N3 was earned and a maximum of N273 as after tax profit
on every N100 equity share issued. Cash flow from operating activities has a mean of 1.78 and a maximum of 54.5.
This indicates that the maximum amount of cash generated from operating activities is N5,450 and a minimum of –
N690 of cash out flow. An average of N178 was generated by listed conglomerate companies in Nigeria on cash flow
from operating activities. The standard deviation of 8.54 shows high level of dispersion.
Cash flow from investing activities has a mean of 1.16, which ranges from minimum of a negative 3.50 and a maximum
of 19.99. This indicates that listed conglomerate companies in Nigeria generate an average of N116 of cash from
2020 The International Journal of Business and Management Research, “IJBMR” Vol.13 Number 1
48
investing activities and a maximum amount of N2000 and the level of dispersion between the mean is 3.5. Cash flow
from financing activities has a negative mean of 1.96 which ranges from a minimum of -30.20 to a maximum of 4.67
and the level of dispersion between the mean is 6.72 which is high. The control variables used in the study reveal that
the mean value of Firm Size is 6.75 and a standard deviation of 0.28 indicates a low level of dispersion in size of the
companies during the study period. The minimum value of 6.5 and the maximum value of 7.4 indicate that listed
conglomerate companies in Nigeria do not differ significantly in size. The mean value of Financial leverage (FL) is
0.52 indicating an average of 52% on the five listed conglomerate companies in Nigeria over the ten years period to
2014. This indicates that most of the sampled companies have a ratio of higher than 50% of total liabilities to total
assets and the standard deviation indicate a low dispersion between the mean of 0.25.
Correlation results
The correlation matrix table shows the relationship between all pairs of variables in the regression model. In an effort
to establish the nature of the correlation between the dependent and the independent variables and also to ascertain
whether or not multicollinearity exists as a result of the correlation among variables, Pearson correlation analysis was
used to assess the relationship between the variables of cash flow and corporate financial performance. Table 4.2
presents the correlation between the dependent (ROA and ROE) as well as the explanatory variables (CFO, CFI, CFF
SIZE and FL) respectively.
Table 4: Correlation Matrix of Dependent and Independent Variables
VARIABLES
ROA
ROE
CFO
CFI
CFF
SIZE
FL
VIF
ROA
1.0000
ROE
0.2664
1.0000