Managerial Ties and Sustainable Performance of Small and Medium- Sized Enterprises (SMES) in the Federal Capital Territory (FCT), Abuja

Abstract

Small and Medium-Sized Enterprises (SMEs) in the Federal Capital Territory (FCT), Abuja, face persistent challenges in achieving sustainable performance, marked by limited revenue growth and operational inefficiencies due to inadequate utilization of managerial ties. This study examined the influence of business and political ties on revenue growth and operational efficiency of SMEs in FCT-Abuja, adopting a descriptive research design. The population comprised 349 SME owners/managers, with a sample size of 223 determined via Taro Yamane’s formula. A multi-stage sampling technique (stratified and simple random) was employed, and data were collected through structured questionnaire using a five-point Likert scale. Analysis via SPSS included descriptive statistics and regression. Findings revealed that business ties significantly enhanced revenue growth (R²=0.720, β=0.849, p<0.05), driven by supplier interactions, industry networking, and mentorship. Political ties positively impacted operational efficiency (R²=0.644, β=0.803, p<0.05), facilitating regulatory compliance, access to permits, and government contracts The study concludes that leveraging business and political ties is essential for SME performance, but an overreliance may pose risks such as undue dependency on external influences. It is recommended that SMEs actively build business networks through partnerships and trade associations to drive revenue growth. SMEs should also strategically engage with political stakeholders to enhance regulatory compliance and operational efficiency while maintaining ethical business practices. These insights contribute to the body of knowledge on SME performance and provide practical strategies for business owners to optimize their networks for sustainable growth.