ANALYSIS OF ENTREPRENEURIAL ORIENTATION ON THE PERFORMANCE OF REAL ESTATE FIRMS IN SOUTH WEST, NIGERIA

Abstract

Despite the impressive performance evident in the real estate sector, its outreach still remains severely constrained because of the inconsistent findings in the literature concerning the relationship between Entrepreneurship Orientation (EO) and Organisation Performance (OP). Due to the inconsistent results, new studies have emerged and these have prompted a further investigation on the effect of EO and other variables that may better explain the nature of this link. This study examined the effect of EO- dimensions on the performance of real estate firms as a strategy of capturing the large unexploited real estate market. To achieve this purpose, the study employed a survey research design. The population of the study comprised of 967 registered Real Estate Development Companies and 464 registered and Practicing Estate Surveyors and Valuers in the South West, Nigeria, making a total of 1431 respondents. The sample size of 501 was determined using census approach for the firms in Ogun, Ondo, Ekiti, Oyo and Osun State, while Kothari formula was used to determine the sample size of the population of the study in Lagos State. A structured questionnaire was adapted, validated and used to collect data for the study. The response rate was 78%. The reliability test was determined using Cronbach’s alpha and all the variables yielded above 0.7. The data were analysed using descriptive (percentages, mean and standard deviation) and inferential statistics (multiple and hierarchical regression analysis). The findings revealed that EO has a significant effect on profitability (R= 0.794, R2 = 0.630, F-statistic = 39.206, P = <0.05), employee turnover (R= 0.820, R2 = 0.673, F-statistic = 50.530, P = <0.05), market share (R= 0.820, R2 = 0.671, F-statistic = 49.234, P = <0.05) and competitive advantages of the firms (R= 0.789, R2 = 0.615, F-statistic = 37.184, P = <0.05). The results have also confirmed the moderating effect of the age of the firms on the relationship between each of the EO- dimensions and performance of real estate firms at a significant level of at P < 0.05. The study concluded that there is a positive relationship between the EO- dimensions and the four performance indicators (profitability, employee turnover, market share and the comparative advantage of the firms), and the age of the firms are good predictors of firms’ performance. The study recommended that the utilisation of EO- dimensions could lead to improved performance of the real estate firms. Also, it is important for the government and the real estate investors to develop internal strategic measures that will promote EO- dimensions in management practices. Policy decisions should be directed towards integrating strategic entrepreneurial orientation into the management practices of real estate firms.