Management Problems Of Public Enterprises In Nigeria (A Case Study Of PHCN, Nnewi District Anambra State).

Project and Seminar material for Public Administration

Project and Seminar material for Public Administration


One of the major objectives of any government is a stable growth and development of the country through industrialization. One of the avenues through which this is achieved is by the establishment of public enterprises.

This research project aims at finding out the management problems of public enterprises in Nigeria using power Holding Company of Nigeria, Nnewi District Anambra State as a case study. The research investigate how much power Holding Company of Nigeria has contributed to the general growth and development of Nigeria and also to identify any managerial problems facing them.

The analysis of data was based on the questionnaire and oral interview administered among staff in the organization. In conclusion it was observed that continuous interference by government, non-regular payment of staff salaries and the obvious lack of management planning and competitive strategy.

However, for the purpose of the organization management should be given some of authority in taking quick routine decisions as necessary by contingency without interference of government or board of directors.

Table Of Content

Preliminary Page(s)

  • Title Page
  • Approval Page
  • Dedication
  • Acknowledgement
  • Abstract
  • Table Of Contents

Chapter One

1.0 Introduction

  • 1.1 Background of the Study
  • 1.2 Statement of the problem
  • 1.3 Objective of the Study
  • 1.4 Research questions
  • 1.5 Significance of the Study
  • 1.6 Scope of the Study
  • 1.7 Limitation of Study
  • 1.8 Definition of Terms

Chapter Two

2.0 Literature Review

  • 2.1 Introduction
  • 2.2 The Concept and Purpose of Public Enterprises
  • 2.3 History and Growth of Public Enterprises
  • 2.4 Structure of the Public Enterprise
  • 2.5 The Problems of Public Enterprises
  • 2.6 Economic Factors
  • 2.7 Financial Problem/ Mismanagement
  • 2.8 Political Factors
  • 2.9 Ethnicity Problem
  • 2.10 Nigeria Work Attitudes
  • 2.11 Administration Factors
  • 2.12 Operational Technical Factors
  • References

Chapter Three

3.0 Research Design and Methodology

  • 3.1 Introduction
  • 3.2 Research Design
  • 3.3 Sources/methods of data collection
  • 3.4 population and sample size
  • 3.5 sampling techniques
  • 3.6 Validity and Reliability of measuring Instrument
  • 3.7 Method of data analysis

Chapter Four

4.0 Presentation and Analysis of Data

  • 4.1 Introduction
  • 4.2 Presentation of data
  • 4.3 Analysis of data

Chapter Five

5.0 Summary, Conclusion and Recommendations

  • 5.1 Introduction
  • 5.2 Summary of findings
  • 5.3 Conclusions
  • 5.4 Recommendations
  • Bibliography
  • Appendices

Chapter One

1.0 Introduction

1.1 Background Of Study

In any developing economy, the government is the main initiator and promoter economic development, especially in Nigeria. In developing countries, government usually intervene in some areas of the economy in which the private sector cannot perform. According to Abubakar (1986) in order to facilitate what the federal government has instituted and made use of many public enterprises over the years.

It would be recalled however that in the fifties and sixties, agriculture was the main stay of the Nigerian economy. The early seventies earned for Nigeria a lot of revenue including revenue from all level that was never anticipated. This new dimension got government involved more with widely diversified investments in areas that span both the traditional public sector and exclusive private sector business.

As a result of this development include crude oil and agriculture that was the main stay of our economy was later given less attention. Owing to this circumstance, the government investments were sponsored mostly by the oil revenues. The oil boom era (1974-1979) has been described as the golden era for public investment. The government invested in over 30 parastatals and companies within this period.

Most of them have been unprofitable; some cannot even meet their operating costs and have depended on government subventions for their year to year survival. Public co-operations in Nigeria have been considered inefficient and unyielding, this is because they have viewed it with the profit criterion. Kindleberger (1986) however opines that this is not a fair judgment, economic activities, it is usually not appropriate to use the performance standard of the private sector they are, the objective of private business is profit, while the government enterprises is services to the society or promotion of general welfare.

Olisa (1985) said that prior to independent and after Nigeria was faced with the problem of attaining her social economic objectives, there was no well destined capitalist class that could operate the much needed development through their productive and industrializing activities. The civil service as that time was inappropriate for accelerated development and the country was saddened with the problem of running many businesses.

These parastatals are established outside the civil services and this allows for greater freedom of action, quicker decision making which will promote their efficiency and effectiveness. These corporations are managed through government appointed officials who could utilize the profits accruing from their operations in catering for the public interest. Onwudunmo(1970), Ugwu(1990) opined that in Nigeria, it is very unfortunate that government have rapid development and this is because the management of these enterprises have constituted the bane of these enterprises.

Most of them failed to meet peoples’ expectations in terms of provision of goods and services and development in general. The commercially oriented ones neither make profit nor even sustain themselves. All efforts by successive government yield no positive result despite various commissions of review parties.

The performance of these enterprises still fall shorts of peoples’ expectations. It is based on this that the researcher finds the needs to investigate these problems in power holding company of Nigeria (PHCN).

1.2 Statement Of The Problem

It is important to note that public enterprises in any given economy has important role to play in the rapid socio-economic development of the country.

Government owned enterprises and businesses in Nigeria are established to accelerate the pace of economic development in which government is the major investor. Due to the important roles associated with the major public enterprises in Nigeria, there is need for good management for its efficiency. It is a fact that government spends large sums of money in setting up these enterprises and thus looks forward for making profit.

As a result of inefficiency in running these enterprises, federal government and state government have in the recent past set up committee which studied the public corporations and parastatals and recommended privatization and commercialization of some of these enterprises. These enterprises perform so poorly than privately owned business.

Since public enterprises are important in growth of any economy, there is the need to investigate the problems of public enterprises in Nigeria. Also, there is need to identify the reasons for criticism leveled against them. Despite the enormous investment in public enterprises, Nigeria is obviously not getting good value for the money being spent or invested on these public enterprises. This gives the decision to this research on “Management problems of public enterprises in Nigeria” using PHCN as a case study.

1.3 Objectives Of The Study

This study is aimed at the management problems of public enterprises in Nnewi District of Anambra state with a view of identifying these problems and therefore coming up with solutions to them as related to the aforementioned corporation.
This study aims to:

  1. Identifying some of management problems facing the public enterprises in Nnewi District of Anambra state.
  2. Examining the influence/ impact of the problems on the corporations in particular and state as a whole.
  3. Identify the level of government interference on their performance.
  4. To determine appropriate measures to checkmate the problems.

1.4 Research Questions

  1. How can management proficiency be determined in public enterprises in Nnewi District of Anambra state PHCN?
  2. What are the influences or impact of the problems on the corporations?
  3. What is the level of government interference on the corporations’ performance?
  4. What are those things that will be into consideration in order to checkmate the problems of the corporation?

1.5 Significance Of Study

In third world countries, public enterprises are noted for their inefficiency and waste of resources. To save the situation, an inquiry is needed in its sector of our economy especially at this time of economic difficulties facing the country.

The country cannot afford to encourage or entertain any kind of economic waste in our public enterprises since if efficiency is maximized, it will definitely have a positive effect on the improve standard of living of the general public. This is the significance of this study. It is noted that the study of the management problems in the public enterprises in Nnewi District (PHCN) will help management sort some managerial problems so that both workers and organizations will benefit, and public enterprises will achieve more in future.

1.6 Scope Of The Study

This study seeks to cover various management problems identified in the government owned establishment but because of the limitation of time it will only cover the problems that will hinder the profitability of the power holding company of Nigeria.

1.7 Limitation Of The Study

This is the problems that are facing various management using power Holding Company of Nigeria.

  1. Their limitation in terms of time and financial logistics.
  2. Lack of encouragement from staff of the organization being studied and
  3. Administrative bottleneck that act as impediments to smooth in carrying out of this work.

1.9 Definition Of Terms


It is a process or form of work that involves the guidance or direction of a group of people towards organizational goals or objectives.


A warehouse is a commercial building for storage of goods.


It is the process by which term applied to the craft or making the producers or a producer of service with customers, both existing and potential.


Sales is the activity of selling forms an integral part of commercial activity mastering sales considered by some sort of persuading art on the contrary.

Public Enterprises:

It is an organization set up as a corporate body and as part of governmental apparatus for an entrepreneurial-like objective.

Chapter Five

5.0 Summary Of Findings, Conclusions And Recommendations

5.1 Introduction

At the end of the presentation of data obtained from the field student, a presentation of the summary of these findings were of great importance and of course a recommendation which the researcher thinks will be of help to the management problem of public enterprises in Nigeria.

Furthermore, efforts were made at presenting the views of various researchers and authors on the problems of public enterprises and this influences the formation of the three hypotheses presented for research.

5.2 Summary Of Findings

The researcher / research attempted to study the development of public enterprises in Owerri with reference to Power Holding Company of Nigeria. In addition, efforts were made of renewing the concepts and purpose of public enterprises. The performance and problems of public enterprises were also reviewed.

Furthermore, efforts were made at presenting the views of various researchers and authors on the problems of public enterprises and this influences the formulation of the three hypotheses presented for research.

Finally, the analysis made in chapter four forms an important part of the discussions that follows. After the data collected have been preserved and analyzed, the following findings were made by the researchers.

  1. That management’s misplacement of funds reflects its inefficiency.
  2. That staff salaries were not paid regularly and this affects their appreciation for their job.
  3. That the exertion of control by the government do not facilitate decision making and do not improve the efficiency of the organization.
  4. That lack of training staff affects the manpower planning of the organization.

In consideration of this findings, the researcher dealing with the first finding, it was proved that management misplacement of organizational objectives is not the bone of efficiency, this could be attributed to the fact that in so far s the workers are selected on the basis of merit and properly remunerated, and goals could still be realized despite poor performance of management. There are cases in everyday life where workers set to right the wrong-doings of management especially in areas were managers are appointed on the basis of sectional representation and not by merit.

Finally, there was also the finding the execution of control by the government do not facilitate decision making and do not improve the efficiency of the organization. It has been observed that the state and method of government control and interference over activities a public corporation affects it operation. The management is not given the freedom to initiate activities that can guide administration. The management has to seek the approval of the board of directors who in most cases has no knowledge of the business before taking crucial actions.

In some cases, answers may take too long to come. The general managers and the managers who are in organization are likely to be more knowledgeable than a political appointee or members of the board of directors, in organizing and management of company. The management should be allowed to handled issues that need immediate attention or otherwise impair efficiency of the organization.

5.3 Conclusion

The success of any business enterprises is entirely dependent upon the efficiency on its managerial system. Therefore, the demand for a strategic managerial approach in such sector as in PHCN in Nigeria cannot be over-emphasized. It is often a misnomer to regard as mere public sector, which cannot be managed efficiently and cost-effectively, the concepts of all disciplines of human endeavour and most especially in the process of technological transformation and commercialization of the enterprise product in Nigeria.

Continuous interference by government, non regular payment of staff salaries and the obvious lack of training staff are within the general preview of management planning and competitive strategy. Efficient management is the key to managing the desired product of the enterprise available to the public at the right time. The enterprises product, being a strategic product in Nigeria, the government and other agencies connected with he marketing and distribution are hereby called upon to find a lasting solution to the management problems associated with the company (PHCN) by complementing the recommendation attempt to provide solution to the problems earlier identified in the study.

5.4 Recommendations

As a result of the importance of government owned companies in the development of the economy and their problem expressed by the respondents in the course of the research work, the following recommendations were made by the researchers;

These will help in improving the performance of the public enterprises in particular and the nations economy at large.

  1. The management should maintain a dear rationalized staff established policy and procedure consistent with its defined goals and the mechanisms for their attainment. Staffing should bee seen as one of the most important functions in the establishment. The management should appoint and promote their personnel on the basis of some rational guidelines.
  2. Adequate revenue should be allocated to government owned enterprise. Due to the grossly inadequate allocation of revenue, many facilities and equipment have been ground. This led to the reduction in the service the organization can offer and led to low patronage. Funds should be made available to enable the enterprise to acquire modern facilities and maintain properly the ones they already have.

For the purpose of the organization, management should be given some means of authority in taking quick routine decisions as necessary by contingency without interference of government or board of directors. The management should initiate new plans that are necessary for the successful operation of the company because being part of the organization, they can identify fully with the aspirations and problems of the company.

We agree that management is important because every human organization requires effective management to be successful.

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