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MalaysianJournal
of
Cooperatives as Indicator of Organizational IntegrityRosmimah Mohd Roslin, Raja Maimon Raja Yusof,
Rahimah Abdul Samad & Hasrin Abu Hassan
Determinants of Cooperatives Members’ Participation inInput and Output Marketing by Multipurpose Cooperatives -
An Empirical Analysis in Tigray Region, EthiopiaR. Karunakaran, Brehanu Borji & Ahmedin Sherefa
Attributes and Perceived Success Factors of PerformingCooperatives in Malaysia
Nurizah Noordin, Sushila Devi Rajaratnam,Mohd. Shahron Anuar Said, Rafedah Juhan & Farahaini Mohd. Hanif
Indicators of Good Governance Practices in Self EmployedWomen’s Saccos Union in Addis Ababa, Ethiopia -
An Exploratory StudyM. Karthikeyan
Cabaran Koperasi Pengguna dalam AktivitiPeruncitan di Semenanjung Malaysia
Norazlan Hasbullah, Noranita Mohd Nor, Mohd Faisal Shariff,Ju Samsuddin Safian & Arfizawati Abd Hadi
Tahap Pengambilan Risiko dalam Gerakan Koperasi di MalaysiaNorwatim Abd Latiff
KPDNKK
Co-operativeStudies
Formerly known as Malaysian Journal of Co-operative Management (MJCM)
VOLUME 7 2011
VOLU
ME 7 2011
I SSN: 1823-5387
MALAYSIAN JOURNAL OF CO-OPERATIVE STUDIESEDITORIAL BOARD
Chief EditorNorazlan Hasbullah
EditorsRaja Maimon Raja Yusof Dr. Jamilah DinNurizah Noordin
ReviewersProf. Dato’ Dr. Ismail Rejab Prof. Dr. Mohd. Ghazali MohayidinProf. Dr. Rosmimah Mohd RoslinAssoc. Prof. Dr. Rahmah Abd. Rashid Assoc. Prof. Dr. Noryati AhmadAssoc. Prof. Syed Mohd. Ghazali Wafa Syed Adwam WafaDato’ Dr. Tam Weng WahDr. Ravichandran Moorthy Dr. Mohd. Rafi YaacobDr. Zakiah Saleh Editorial Advisory Board MembersIdris Ismail (Co-operative College of Malaysia)Prof. Dato’ Dr. Ismail Rejab (Universiti Tun Abdul Razak) Prof. Dr. Mohd. Ghazali Mohayidin (Open University Malaysia)Prof. Dr. Rosmimah Mohd Roslin (Universiti Teknologi MARA)Assoc. Prof. Dr. Rahmah Abd. Rashid (Universiti Teknologi MARA)Assoc. Prof. Dr. Noryati Ahmad (Universiti Teknologi MARA)Assoc Prof. Syed Mohd. Ghazali Wafa Syed Adwam Wafa (Universiti Kebangsaan Malaysia)Dato’ Dr. Tam Weng Wah (Jabatan Perdana Menteri)Dr. Ravichandran Moorthy (Universiti Kebangsaan Malaysia)Dr. Mohd. Rafi Yaacob (Universiti Malaysia Kelantan)
Managing EditorYusnita Othman
SecretariatAfiza Abdul KarimSharepah Nur Azirah Shareh Abd. Rahman
CONTENTS
Malaysian Journal of Co-operative Studies Editorial Board iii
Co-operatives as Indicator of Organizational Integrity 1 Rosmimah Mohd Roslin, Raja Maimon Raja Yusof, Rahimah Abdul Samad & Hasrin Abu Hassan
Determinants of Co-operatives Members’ Participation in Input 15and Output Marketing by Multipurpose Co-operatives - An Empirical Analysis in Tigray Region, Ethiopia R. Karunakaran, Brehanu Borji & Ahmedin Sherefa
Attributes and Perceived Success Factors of Performing 37Co-operatives in Malaysia Nurizah Noordin, Sushila Devi Rajaratnam, Mohd. Shahron Anuar Said, Rafedah Juhan & Farahaini Mohd. Hanif
Indicators of Good Governance Practices in Self Employed Women’s 69 Saccos Union in Addis Ababa, Ethiopia – An Exploratory Study M. Karthikeyan
Cabaran Koperasi Pengguna dalam Aktiviti Peruncitan 87 di Semenanjung Malaysia Norazlan Hasbullah, Noranita Mohd Nor, Mohd Faisal Shariff, JuSamsuddinSafian&ArfizawatiAbdHadi
Tahap Pengambilan Risiko dalam Gerakan Koperasi di Malaysia 103 NorwatimAbdLatiff
CO-OPERATIVES AS INDICATOR OF ORGANIZATIONAL INTEGRITY
Rosmimah Mohd Roslin
Universiti Teknologi MARA, Malaysia
Raja Maimon Raja YusofRahimah Abdul Samad
Hasrin Abu Hassan
Co-operative College of Malaysia
ABSTRACT
Thisstudyaddressesthequestionofhowretailco-operativesprojecttheirstatureassociallyresponsibleco-operativesthroughtheircorporatecultureandtheirbusinessability.Usingintegrityastheproxytosuchprojection,thelinkbetweenintegrityandthecorporatecultureandintegrityandbusinessabilitiesareassessed.Thefindingsofthisstudyconfirmedsuchrelationshipsandfurtherillustratehowintegrityisdeemedcrucialtotheimageoftheco-operatives.Althoughthisstudyisjustanextensionofanotherstudyonretailco-operatives,itneverthelessestablishedhowco-operativesviewtheirpositionsassociallyresponsibleentitiesandhowimportantitisfortheco-operativestoconstantlydisplaytheiractionsasbeingeffortsthatwillallowtheirmembersandthepublictoperceivethempositively.
INTRODUCTION
Co-operatives are social enterprises that are formed and owned by a group of individuals for the purpose of improving their standard of living. The underlying philosophy of co-operatives is essentially service and the well-being of members and as such, co-operatives are non profit-oriented and will always put the welfare of the members as a priority when making key decisions (Tchami, 2007). Most co-operatives are governed by seven co-operative principles that have been universally accepted and adopted by the International Co-operative Alliance. The principles are voluntary and included open membership; democratic member control; member economic participation; autonomy and independence; education, training and information; co-operation among co-operatives; and concern for the
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community. It is this underlying philosophy that has guided the movement of co-operatives in Malaysia.
Today, the integrity of the co-operative movement in preserving its concept and ideology is being challenged by current trends in the area of information and communications technology (ICT), impact of globalization and liberalization of trade, deregulation and changes in national and global policies. The world has become very competitive for the co-operatives and for those that are operating numerous business ventures as their main source of revenue, the need to uphold the welfare of the members have become more challenging. The business world has never incorporated welfare and autonomic rule as key ingredients to the achievement of high profits. Indeed, business demands and the core responsibility of the co-operatives are at extreme ends and this may prove to be a challenge to those co-operatives upholding the core principles of their existence. Co-operatives also face challenges in improving their stature as well organized co-operatives and the quality of services and products to members. At the same time, they face the challenge of competing with the private sector in a fair and competitive environment.
Challenged by such environmental demands, co-operatives are using their formal entities as means of displaying their integrity. With the co-operative label, these organizations are persuading the public that their existences are solely for the welfare of their members. Although involved in many business undertakings, co-operatives are facing the dilemma of convincing the public that they are genuinely honest, are of high integrity and more importantly are carrying out tasks that have the good welfare of their members at heart. Yet, there are many co-operatives that have been disgraced because of dishonest dealings and mismanagement of funds. This proposed study addresses the extent that co-operatives in Malaysia are using their identities as tools of public relations and to display their image of integrity. Using co-operatives involved in the retail business as respondents, this study evaluates the extent of ‘believability’ that the co-operatives expressed through their roles as co-operatives. From the findings an assessment of organizational identities of co-operatives can be derived and this would assist the co-operatives to understand their roles better.
Corporate Integrity in the Co-operative Environment
Brenkert (2004) asserts that corporations are organizations of humans and those organizations that are not dysfunctional and execute their functions in accordance to what they preach can be regarded as exhibiting some form of integrity. Yet, integrity itself is often subjective and contains many contradictions. This is
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attributed to integrity being associated with the corporate leader or the CEOs and they are increasingly being held accountable for the behaviours of their corporate citizens (Harshbarger & Stringer, 2003). Being a corporate leader is doing what is right on several different levels or in several different ways. Being a corporate leader is about integrity, responsibility, and excellence, and perhaps even honour (Lennick & Kiel, 2005).
Integrity is also associated with the feeling of trust that one has over an organization. The way the organization acts, the way it executes its responsibilities and the way it projects itself are signs of integrity. High levels of corporate integrity will add significant value to the corporation both by avoiding costs and, more importantly, by avoiding damaging losses of brand equity, reputation, and marketplace influence—valuable sources of competitive advantage. In essence, high integrity is good for business (Harshbarger & Stringer, 2003, p.16).
Based on this premise, co-operatives with their underlying philosophy of working for the group and upholding the principle of goodliness for all, would want to be associated with high levels of integrity. It is more pertinent for co-operatives to display a sense of trust and building a sense of community of practices not only among the co-operative members but also with customers and other stakeholders. Kakuchi (1995) observes the Japanese co-operatives and reiterate how co-operatives are essentially obligated to the society in offering goods of high quality and of reasonable prices. Thus, co-operatives are social engines that actually worked for the good of the community and therefore integrity must be observed always.
A sense of integrity linked to trust is expected to be present within the co-operative work environment as co-operative leaders embark on business ventures aimed at attaining substantial returns which are to be shared among the members. The values and principles of co-operatives encourage them to develop a clear ethical stance and to emphasize meeting people’s needs over maximizing profits for shareholders. In so doing, co-operatives work within democratic structures, which provide opportunities for input and involvement for key stakeholders (e.g., member-owners, management, employees, community), and which necessitate emphasis on transparency and accountability (Brown, 2006). Thus, the need to address issues relating to integrity as reflected by the way the co-operatives project themselves through their marketing efforts and their corporate culture will dictate the credibility of the co-operative and its adherence to its core principles of democracy, voluntarism and community values.
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Corporate Culture and Abilities – Linkage to Integrity
The values adhered by the co-operatives are also linked to the corporate culture they advocate. Goals, philosophies and principles are deemed to portray the construct of corporate culture (Melewar & Jenkins, 2002) and these are valid elements present within the co-operative environment. Corporate culture is the personality or the shared values of the organization (Koberg & Chusmir, 1987) and in the context of co-operatives, it is such culture that dictates the behaviour of the members and the co-operatives’ ‘way of life’. In assessing the corporate culture, one is able to assess the extent of adherence of the co-operative to the community. As a co-operative, their culture or the way the members and the leaders behave may reveal their true character. Thus, the construct of corporate culture is postulated to influence the extent of integrity especially within the co-operative scenario.
In line with this assumption, the co-operatives’ ability to carry out their responsibilities diligently and with the highest level of integrity is the core of their existence. The behaviour of the members and the leaders would therefore project the image that the co-operative is indeed credible in their execution of responsibilities. Sternberg (1991) expresses the idea that corporate identity is all about values and these values direct operations and behaviours of the members. As co-operatives are also business entities, the ability in carrying out their businesses effectively and their keen sense of business acumen will indicate their level of social responsibility. It is therefore pertinent that the co-operatives’ ability be given adequate attention in ensuring that the integrity of the co-operative is upheld. Thus, the co-operatives’ ability is deemed as another construct which may well influence the level of integrity projected by co-operatives. Although there is no common designation and consensus as to how business performances should be evaluated especially for co-operatives, in this study, the co-operatives’ business ability is assessed by operationalizing it through the elements of financial stability, business acumen and the strategic orientation adopted by the co-operatives in managing their businesses. This is decided based on the integration of several studies assessing performance and productivity (Jessup et al., 2004; Dragun, Howard & Reynolds, 2004) to provide a basic idea of how business abilities could be measured.
THE STUDY
This study is an extraction of a bigger study conducted between two institutions, Universiti Teknologi MARA and the Co-operative College of Malaysia. The initial study sets out to assess the extent of involvement co-operatives have in the retail
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business. From this study, delineation was made of those co-operatives already involved in the retail business and an evaluation of the extent of their efforts in projecting their image as a co-operative of high integrity was carried out. A total of 100 retail co-operatives were identified and the assessment of their activities associated with their display of integrity and corporate identities were carried out.
The objectives of the study therefore were to:
Determine the efforts exerted by the co-operatives in displaying their level 1. of integrity.
Evaluate the correlation between the corporate culture of co-operatives with 2. the level of integrity displayed.
Assess the relationship between the ability of the co-operatives to carry out 3. their business ventures and the level of integrity projected through their marketing efforts.
The objectives serve as the basis to determine how co-operatives used their virtues as co-operatives to relate to the public their identities as highly responsible entities. The framework for this study is outlined in Figure 1 below.
Figure 1: Research Framework
Corporate culture• Identity• Values• Behaviour• Commitment
Ability of Co-operatives• Strategic direction• Financial stability• Business acumen
Integrity of Co-operatives• Trustworthiness• Accountability
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METHODOLOGY
Using the descriptive method of research, a questionnaire was developed as the main instrument for data collection. Based on the sampling frame of co-operatives registered with the Malaysian Co-operative Commission (Suruhanjaya Koperasi Malaysia) a total of 500 consumer co-operatives were identified. From the 500, co-operatives that were active and still operating were identified. A stratified random sampling was then carried out based on geographical zones of main cities in Malaysia and co-operatives from these zones were randomly selected. This list was then distributed to enumerators for the distribution of questionnaire. Enumerators met with any of the key management team of the co-operatives and they were asked to answer the questionnaire. Generally, the respondents were represented by any one of the board members, the managers or the secretary of the co-operatives. In total 100 co-operatives that were actively involved in the retail business answered the questionnaire.
Quantitative analysis followed after the data were keyed in, cleaned and processed accordingly. Descriptive analyses including correlation were then executed to answer the research objectives. The following discussion explains the findings and answers the research objectives.
FINDINGS AND ANALYSIS
The analysis begins with an assessment of the reliability of the instrument used for the research. As such, reliability test was carried out to ensure that consistency of the research items was maintained at all times. Table 1, provides the Cronbach alpha values of the three main variables in the study. The highest values are noted for the variable of corporate culture with a Cronbach alpha of .8388 while the alpha value for integrity is .6480. Sekaran & Bougie (2010) asserts that alpha values of .6 and above can be considered as acceptable for most social research that is exploratory in nature. However, in this case, the items on abilities need further assessment as the consistency is rather low as depicted by the value of .4176.
Table 1: Reliability Analysis
Variables No. of Items Alpha values
Integrity 7 .6480
Corporate culture 6 .8388
Abilities 5 .4176
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The low alpha value for the items on abilities may be attributed to the scarce number of items in assessing this variable. As asserted by Hattie (1985), Cronbach alpha values may increase with an increment of items. The measure of co-operative abilities may also be a complex construct where the co-operatives may view their abilities differently and not necessarily from a business perspective. Despite their involvement in the retail business, the co-operatives’ abilities may be evaluated also from their social responsibility angle. As this was not inserted in measuring the variable, there appear to be some inconsistencies in the views of the respondents. Nevertheless, the items are still maintained for this exploratory study as it is only meant to gauge the co-operatives’ initial assessment of their business acumen.
The descriptive analysis that follows is presented in Table 2 where the basic details of the co-operatives are described to gauge the background of the co-operatives. A majority (46%) of the co-operatives were experienced ones having been established before 1990. Such an indication of experience would imply their ability to manage their co-operatives and to understand the demands of ensuring that the co-operatives live up to its name. The number of members is also indicative of the co-operatives’ strength. In total 35% of the co-operatives have members of 100 to 300 and 32% have more than 500 members. The size of the co-operatives is important to imply their abilities to carry out more demanding activities and therefore their business ventures are also likely to be more structured to gain adequate profits for dividend payments to all its members.
Another indicator of size is the amount of capital that the co-operatives possess. A total of 32% of the co-operatives owned more than RM100 thousand (USD31.3 thousand) of capital and by Malaysian standard, this is relatively large. Although the assets accumulated are not relatively large (54% reporting less than RM50,000 or USD15,600), this is typical of co-operatives that are not necessarily inclined to accumulate assets as this would imply fixed investments that may not directly benefit all the members.
In terms of the income generated by these co-operatives, a majority (69%) are reporting a relatively low income of less than RM100,000 (USD31,250) in the year ending 2008. What can be implied here is the tendency of the co-operatives to be involved in less risky ventures that may not be accumulating large amount of income for them. Those who are involved in retailing are generally relying on their members as their target customers. This is the scenario in Malaysia where no significant large retail co-operatives exist. Those that do report their involvement in the retail business
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are basically targeting their members and these co-operatives are located in specific rural or suburban areas where there is a dearth of modern retail outlets. This is in fact a contribution of the co-operatives who feel that they are socially obligated to provide the retail services to their members.
Table 2: Co-operatives’ Background
Details of Co-operatives %
Year established Before 1990 46.0
1990-1995 20.0
1996-2000 8.0
2001-2005 16.0
After 2005 10.0
Number of members Less than 100 19.0
100-300 35.0
301-500 14.0
More than 500 32.0
Amount of capital (2008) Less than RM10K 29.0
RM10K-RM50K 20.0
RM51K-RM100K 19.0
More than RM100K 32.0
Amount of assets (2008) Less than RM50K 54.0
RM50K-RM100K 12.0
RM101K-RM500K 16.0
More than RM500K 18.0
Net income (2008) Less than RM100K 69.0
RM100K-RM500K 15.0
RM501K-RM1Million 10.0
More than RM1 million 6.0
The analysis continues with a descriptive analysis on the efforts relating to the projection of integrity of the co-operatives. This includes items pertaining to the level of trustworthiness and accountability of the co-operatives based on their perceptive assessment. As indicated in Table 3, trustworthiness as displayed through the experiences of the board of directors, the knowledge of the staff/members who work in the retail outlets and the confidence that the customers as well as the members have toward the co-operatives are depicted by a mean of 4.76. On a scale of 1 (extremely
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unimportant) to 6 (extremely important), a mean of 4.76 implies a relatively strong feelings which the co-operatives perceived as their projection of integrity. Accountability is another measure of integrity and this is evaluated through statements relating to the financial aspects of the co-operatives, the supporting element they provide and that are given to them as well as the acceptance of the members/public toward the co-operatives in general. With a mean of 4.66, this is again a reflection of the importance the co-operatives regard the projection of their integrity.
Table 3: Integrity Measure
TRUSTWORTHINESS ACCOUNTABILITYN Valid 100 100 Missing 0 0Mean 4.7600 4.6667Std. Deviation .57726 .72474
Scale: 1: Extremely unimportant – 6: Extremely important
Based on the framework developed, the analysis continues with the assessment of correlations between the variable of integrity and corporate culture as well as integrity and the ability of the co-operatives. As indicated in Table 4, there is a correlation between the culture of the co-operatives and their display of integrity as indicated by the correlation value of .495 for ability and .426 for integrity and corporate personality. Although the correlation values are rather weak, they do indicate the presence of relationship between integrity of the co-operative and how they project themselves through their personality or corporate culture. Their abilities also are indicative of how their integrity is being projected.
Table 4: Correlations
INTEGRITY CULTURE ABILITYINTEGRITY Pearson Correlation 1 .426(**) .495(**) Sig. (2-tailed) . .000 .000 N 100 100 100CULTURE Pearson Correlation .426(**) 1 .430(**) Sig. (2-tailed) .000 . .000 N 100 100 100ABILITY Pearson Correlation .495(**) .430(**) 1 Sig. (2-tailed) .000 .000 . N 100 100 100
** Correlation is significant at the 0.01 level (2-tailed).
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The findings concur with the assumption that co-operatives view their integrity as an indicator of who they are and this is reflected through their corporate culture or their corporate personality. As co-operatives, their responsibility to their members and to the public in general needs to be visible through the way they behave and through their ability to carry out their functions well. In this study, co-operatives that are involved in the retail business are the focus of the research and their abilities to carry out their business operations effectively are also seen as a key element in ensuring that they are carrying their functions effectively as responsible co-operatives.
Further inferential analysis is carried out through regression analysis to determine to what extent the independent variables, corporate culture and abilities influence the integrity of the co-operatives. Table 5 provides the model summary of the regression analysis and the ANOVA output.
Table 5: Model Summary(c) and ANOVA
Model R R Square Adjusted R Square
Std. Error of the Estimate
Durbin-Watson
12
.495(a)
.549(b).245.301
.237
.287.48590.46993
2.104
a Predictors: (Constant), ABILITYb Predictors: (Constant), ABILITY, CULTUREc Dependent Variable: INTEGRIT
ANOVA(c)
Model Sum of Squares
df Mean Square
F Sig.
1 2
RegressionResidualTotalRegressionResidualTotal
7.51623.13830.6549.233
21.42130.654
198992
9799
7.516.236
4.617.221
31.834
20.906
.000(a)
.000(b)
a Predictors: (Constant), ABILITYb Predictors: (Constant), ABILITY, CULTUREc Dependent Variable: INTEGRIT
The predictors of the model are ability and corporate culture or personality and as seen in Table 4, ability of the co-operatives account for 23.7% of the variation on integrity of the co-operatives. When both predictors are entered into the model, this variation increased to 28.7%. The Durbin-Watson value of 2.104 implies that the assumption of independent errors is tenable as the value is close to 2.0 (Field,
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2009). The ANOVA analysis also reveals that the model enhance the prediction of the outcome variable, meaning that integrity as the outcome of the postulated model can be predicted by looking at the two predictors.
DISCUSSION
The study sets out to address the efforts exerted by the co-operatives in their initiatives to project their integrity. As indicated by the descriptive analysis, the co-operatives view aspects of integrity as important in their stature as co-operatives. This then is linked or correlated to dimensions of corporate culture and although the correlation is not distinctively strong (.426), there is still positive relationship. This is also true of the correlation between integrity and the abilities of the co-operatives in carrying out their retail ventures and again even though a correlation of .495 is noted, the positive correlation is enough to indicate that relationship exists among the variables.
The inferential analysis also provides enough evidence to accept the postulation that the corporate identity of the co-operatives which is proxy through the dimensions of integrity is linked to their corporate culture and the display of their abilities. To the co-operatives, integrity is important as this is a reflection of who and what they are. As co-operative they have a social obligation to uphold their outlook as a responsible entity not only to their members but to the public as well. The public especially will generally link the co-operatives with how they carry out their functions and with retail co-operatives they are often in the public eye. As such, their actions are akin to their marketing efforts, be it in a positive or negative manner. What this implies is that as co-operatives their roles and responsibilities are in the public eye and will be scrutinized by the public and their members. As members, the higher the level of identification they have with their co-operatives, the more likely that they relate to the co-operatives (Stoel, 2002). Thus, how a co-operative carries itself is pertinent to the effectiveness of the co-operatives.
This study is only an exploratory one as it seeks to address how the co-operatives view their obligations and how these are translated into the activities that they carry out. With an identity that is reflective of their personality, the co-operatives are indeed using this as a tool to project their level of trustworthiness and accountability. Although much needs to be done, this study has established that co-operatives do carry out distinct efforts to project who and what they are. Indeed co-operatives exist to serve their members and to ensure that the welfare of the members are a priority and if what they do is reflective of who and what they are doing, then would already indicate that they are in the right path to attaining co-operative effectiveness.
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Future studies should address more dimensions that would provide a more rigorous assessment of the corporate culture of co-operatives, the projection of integrity and the means that co-operatives used to evaluate their abilities. What has been done in this study is just a small extension of another study on retail co-operatives and as such, a lot of pertinent elements may have been omitted. It is hoped that this study will open more avenues for other studies on co-operatives especially those that are linked to the marketing efforts of the co-operatives.
REFERENCESBrenkert, G.G. (2004). The need for corporate integrity in Corporate integrity and
accountability, George G. Brenkert (editor), Thousand Oaks, Sage Publications.
Brown, L. (2006). Innovations in co-operative marketing and communications, Centre for the Study of Co-operatives, University of Saskatchewan, 1-16.
Dragun, D, Howard, E. & Reynolds, J. (2004). Assessing the productivity of the UK retail sector, Oxford Institute of Retail Management, Templeton College, University of Oxford.
Field, A. (2009). Discovering statistics using SPSS (Introducing statistical methods series), 3rd. Edition, London, Sage.
Harshbarger, S. & Stringer, R. (2003). Creating a climate of corporate integrity, The Corporate Board, May-June, 10-16.
Hattie J. (1985): Methodology review: assessing unidimensionality of tests and items. Applied Psychology Measure, 9: 139-164.
Jessup, E., Casavant, K., Monson, J. & Duft, K. (2004). Business decisions in a co-operative environment, JournalofBusinessandEconomicResearch, 2(6): 71-75.
Kakuchi, S. (1995). Japan: consumer coops make it big, www.uwcc.wise.edu/icic/today/consumer/big.html, [accessed 30 May, 2009].
Koberg, C.S. & Chusmir, L.H. (1987). Organizational culture relationships with creativity and other job-related variables,JournalofBusinessResearch, 15: 397-409.
Lennick, D. & Kiel, F. (2005). Moralintelligence:Enhancingbusinessperformanceandleadershipsuccess. Upper Saddle River, NJ: Pearson Education Wharton School Publishing.
Melewar, T.C. & Jenkins, S. (2002). Defining the corporate identity construct, Corporate ReputationReview, 5(1): 76-90.
Sekaran, U. & Bougie, R. (2010). Research methods for business: A skill building approach, 5th edition, New York, John Wiley & Sons.
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Sternberg, R. (1991). Making up a face to fit, Asian Business (Hong Kong), 27(4): April, 55-56.
Stoel, L. (2002). Retail co-operatives: group size, group identification, communication frequency and relationship effectiveness, International Journal of Retail and Distribution Management, 30(1): 51-60.
Tchami, G. (2007). Handbook on co-operatives for use of workers’ organizations, Geneva, International Labour Office.
AUTHORS’ BACKGROUND
Prof. Dr. Rosmimah Mohd Roslin is currently a Professor of Marketing at the Faculty of Business Management, Universiti Teknologi MARA, Malaysia and has 23 years experience as a lecturer. Besides teaching, she has undertaken a number of research studies and written journal articles. She also provides advisory services and reviewing journal articles for the International Marketing Review, United Kingdom, International Journal of Interdisciplinary Social Sciences, International Journal of Internet and Enterprise Management, Zagreb University and Jurnal Pengurusan, Universiti Kebangsaan Malaysia. Rosmimah is the Chief Editor for the Journal of International Business and Entrepreneurship (JIBE), Editorial Advisory Board of the Asian Academy of Management Journal and Academic Advisor for the Institute of Marketing Malaysia. In addition she also a member for the Academy of Marketing, United Kingdom, a member for the Asian Academy of Management and a member for the Qualitative Research Association of Malaysia (QRAM).
Raja Maimon Raja Yusof is the Deputy Chief Director (Academic) at the Co-operative College of Malaysia (CCM). She holds a Masters in Business Administration from Universiti Kebangsaan Malaysia (1997), Bachelor in Economics with Honours from Universiti Malaya, Malaysia (1987) and Diploma in Co-operative Training Methodology from Pune, India (1979). She joined CCM in 1979 and is an experienced lecturer in business management. She also provides advisory service to co-operatives, undertaken a number of research studies and written articles relates to co-operative management.
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Rahimah Abd. Samad is currently the senior lecturer of the Co-operative Entrepreneurship and Retailing Centre at the Co-operative College of Malaysia (CCM). She has more than 26 years experience as a lecturer with CCM and besides teaching, has undertaken a number of research studies and written related article in the field of co-operative management. She obtained her Masters in Business Administration (2009) and Bachelor in Business Administration (Human Resource Management) (1998) from Universiti Teknologi MARA, Malaysia.
Hasrin Abu Hassan joined the Co-operative College of Malaysia in 2004 as a lecturer. Besides training, he has been involved in research studies and written related articles. He obtained his Master in Business Administration (Advanced Operation Management) from Universiti Teknikal Malaysia (UTeM), Bachelor in Business Administration (Operation Management) from Universiti Teknologi MARA, Malaysia and Diploma in Technology Management from Universiti Teknologi Malaysia (UTM).
DETERMINANTS OF CO-OPERATIVES MEMBERS’ PARTICIPATION IN INPUT AND OUTPUT MARKETING BY MULTIPURPOSE CO-OPERATIVES - AN EMPIRICAL
ANALYSIS IN TIGRAY REGION, ETHIOPIA
R. Karunakaran, Brehanu Borji & Ahmedin Sherefa
HawassaUniversity,Ethiopia
ABSTRACT
Themainaimofthisstudyistoempiricallyanalyzethemajorfactorsinfluencingmembers’participationininputandoutputmarketingofagriculturalmultipurposeco-operativesintheSouthernZoneofTigrayRegionofEthiopia.Amulti-stagerandomsamplingprocedurewasadoptedastoselectionofWoredas,co-operativesocieties,andmemberrespondents.Assuch,inthefirststage,TigrayRegionwaspurposivelyselected.Inthesecondstage,fromthefiveWoredas(Districts)oftheSouthernZoneofTigrayRegion,AlamataandOflaWoredaswereselectedatrandomforthestudy.Inthethirdstage,outof27primarymultipurposeco-operativesintheselectedWoredas,10societieswereselectedbasedonthevolumeofbusiness.Inthefinalstage,atotalof208samplerespondentsattherateof56fromAlamataand152fromOflaWoredabyadoptingprobabilityproportionatetosizesampling.Primarydatapertainingtotheyear2007/08wascollectedfromtheselectedsamplerespondentsbyusingastructuredinterviewschedule.Ofthetotalrespondents,about70.2%and29.8%wereparticipantsandnon-participantsoftheco-operativesagricultural inputandoutputmarketingrespectively.Probiteconometricmodelwasemployedtoidentifythedeterminantsofparticipationofco-operativemembersintheinputandoutputmarketingbyco-operativesinthetwoWoreda.Fifteenexplanatoryvariableswereincludedinthemodelofwhichtenvariableswerefoundtobesignificant.Ofthese,sixexplanatoryvariablesnamelyownland,shareholding,distance,outputprice,membershipinotherco-operativesandseedpricewerefoundtobesignificantlyandpositivelyrelatedtotheparticipationofco-operativemembersintheagriculturalinputandoutputmarketingbyco-operatives.
INTRODUCTION
Currently, there are around 28,000 primary level co-operatives (60 percent are agricultural co-operatives) 180 secondary co-operatives (unions), two co-operative federations and a Co-operative Bank with 16 branches operating throughout Ethiopia
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serving more than 5 million members with a total capital of over 1.2 billion Ethiopian Birr in different sectors of the economy like Agriculture, Banking, Credit and Savings, Marketing, Processing, Construction, Service, Housing, Irrigation, Agriculture. etc (FederalCo-operativeAgency2010). It is noteworthy that more than 85 percent of the total agricultural inputs requirements of the rural community are distributed through co-operatives. As to market share, co-operatives are responsible for over 25 percent of coffee exports, the major foreign exchange earner of the country. Coffee unions are exporting high-quality, organic and Fair Trade coffee to the United States, Europe and Japan, fetching premium prices on behalf of smallholder coffee farmers. Through co-operative unions, primary co-operatives have unfettered access to inputs at competitive prices with substantial price reductions) and have attained a strong bargaining position in marketing their outputs.
A report of Tigray Co-operative Promotion and Input Marketing Division (2008) indicates that there are 1309 different types of primary and 21 secondary co-operative societies in the region, of which 582 (44.5%) are agricultural multipurpose co-operatives which deal with the input and output marketing of their members. The remaining 727 (55.5%) co-operatives comprise of saving and credit, construction, irrigation and other type of co-operative societies. The co-operative societies in the region have a total membership of 361,242 which includes 275,696 (76.3%) male and 85, 546 (23.7%) female members with a total capital of Birr 71,462,247 (GebruDesta,2007).
The marketing of agricultural products begin at the farm when the farmer plans his production to meet specific demands and markets prospects. Marketing enables the agricultural producer to step out of a subsistence straight jacket and grow produce for sale. Correspondingly, it permits a large proportion of a country’s population to live in cities and buy their food nearby. Agricultural marketing provides an incentive to farmers to grow produce for export. In this way, it gives farmers more income and earns foreign exchange to pay for imports. Agricultural marketing is complicated by the diverse nature of the products to be handled, and their perishability. A further complication is the scattered nature of agricultural production and, in most tropical countries (like Ethiopia), the very large number of separate production units. For these reasons, agricultural marketing calls for considerable initiative, decision making and skill (Kraenzle,1989).
Co-operative Marketing is an extension of the principles of co-operatives in the field of marketing. It is a process of marketing through a co-operative association formed voluntarily by its members to perform one or more marketing functions in respect of their produce.
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Agricultural inputs can be categorized into two types, consumable and capital inputs. The former includes manures and fertilizers, seeds, insecticides/pesticides, diesel oil and electricity, etc, on the other hand, capital inputs include tractors and trailers, harvesters and threshers, pump sets, and other implements. Most of the agricultural input markets are seen at the level of grain market towns and large villages or co-operative institutions. There are some general aspects of the rural market like underdeveloped markets, illiterate buyers, lack of communication facilities, many languages, and vast spread of the market, storage, transport problems, seasonality and demand which are applicable to agricultural input markets as well. However, agricultural input markets differ from other product markets in many ways due to the nature of their products, the nature and location of users and the overall environment in which products are being bought and used (OxfordPolicyManagement,2003).
Under the current institutional arrangement, the Ministry of Agriculture and Rural Development (MoARD) is responsible to design, implement and monitor agricultural marketing policies through the different divisions organized under the department of agricultural marketing and inputs of the Ministry. Other organizations like co-operatives, unions, traders associations, exporters’ associations etc also play an important role in improving the marketing skill, bargaining power and also in the process of policy formulation (Dawit,2005).
Statement of the Problem
The weak performance of the agricultural markets (both input and output markets) in Ethiopia has been portrayed in various studies as a major impediment to growth in the agricultural sector and the overall economy (Dawit,2005). With an inefficient marketing system, the surplus resulting from increased production benefits neither the farmers nor the country (Hind,1994). This is particularly important as the country is following a policy of agriculture led-industrialization and economic development where the agricultural sector is expected to produce surplus that can move to the other sectors of the economy.
The agricultural markets in Ethiopia are highly influenced by the production system itself. Most of the agricultural production is undertaken by small scale producers scattered all over the country, engaged in different agricultural enterprises without specialization, and with limited marketable surplus. It was estimated that only 28 percent of total farm output in 1996 was marketed. Therefore, the scattered produce in small quantity needs to be collected and assembled, graded, and transported from one market level to another. Thus, the marketing system is characterized with a long chain with many intermediaries. An intervention is required to shorten the marketing
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channel in order to reduce the marketing costs incurred at each level of marketing channel so that the benefits will go to the farmers (Gebremeskel,1998).
The cause of success and failures of co-operatives corresponds in a building up and breaking down of co-operative identities through the process by which members and employees grow to hold the identity as their own vision. Although co-operatives are considered as an appropriate tool of rural development they are facing critical problems, which retain them from their positive role. Some of the constraints of co-operatives are: low institutional capacity, inadequate qualified personnel, low entrepreneurship skill, lack of financial resources, lack of market information, poor members’ participation in the different activities such as financing the co-operative, patronizing the business activities of the co-operatives, control and supports it. Moreover, the prices of agricultural inputs are increasing from year to year and farmers are complaining on it. These multifaceted problems make very difficult the over all activities of the co-operatives in general and the agricultural input and output marketing in particular. Among the problems discussed above, members’ participation assumes greater significance since members’ participation is being considered as a prime factor which influences greatly on the input and output marketing system of marketing co-operatives. Thus the present study is an attempt to bring forth the factors influencing members’ participation in input and output marketing by co-operatives in Southern Zone of Tigray.
LITERATURE REVIEW
Participation of members in the agricultural input and output marketing by co-operatives: For the effective functioning of the co-operative movement, members’ participation is the pole of the co-operative. These are members who are aware of the importance of the co-operative societies socially and economically. These members will make themselves aware of the problems and have the willingness to contribute to the progress of the co-operatives. Such membership ensures member participation in the business and managerial affairs of the co-operatives. Vigilant members prevent financial irregularities and the emergence of vested interest in co-operatives. Thus the health of co-operatives improves. As against the participant members, ignorant, sleepy, inactive, non-participative and indifferent members become a problem in themselves. They are prone to exploitation by the convert (change) elements in the society. So the members in the society must be highly participative in all aspects of the co-operative affairs.
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Democracy is the basic value of co-operatives. In a democratic organization like co-operatives, the general body is supreme organ of the organization and the management committee is elected by them to look after the day to day affairs. In this study, the concept of participation lays the involvement of member patrons in patronizing the agricultural input and output marketing made by co-operatives. A few studies pertaining to members’ perception, attitude and participation in co-operatives have been reviewed hereunder.
MitchellA.Seligson(1987) in his report analyzed the Attitude and Perception of Co-operative Members and Nonmembers on the advantages and disadvantages of co-operatives. The study concluded that members of co-operatives have better positive attitude and perception towards the management and administration of co-operatives because of their active participation in both management and business affairs. Further non members too have some knowledge about co-operatives.
Tretcher(1996) used a logit regression analysis to analyze the factors associated with diversification on agricultural co-operatives in Wisconsin. It was found that the impact of diversification upon measures of co-operative performance (profitability, patronage refund and equity redemption) was relatively minor i.e. diversification on agricultural co-operatives was not statistically associated with profitability, increases in patronage dividends or increases in equity devolvement. The result also showed that diversification on agricultural co-operatives was an important factor in determining membership size i.e. diversified co-operatives enjoyed larger membership.
Haileselassie(2003) found that most of the co-operative members appreciated the involvement of co-operatives in input marketing. As a result members in the Saeisietsaeda Emba Woreda in Tigray Region have built a sense of ownership and confidence. The study further indicated that above all members were satisfied for the reason that it removed the need for members moving along distances to collect fertilizer, and reduced time and finance spent on the way.
Kebede (2006) used the logit model to analyze the farmers’ perception and determinants of land management practices in Ofla Woreda, southern Tigray, Ethiopia. The findings of the study showed that Age, Sex, Distance to Woreda market, perceived water logging problem, perceived gully and degradation status, Investment in soil and water conservation practices, slope category were found to determine the farmers perception of land management practice.
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Daniel(2006)used the tobit model to assess the performance of primary agricultural co-operatives and determinants of members’ decision to use as marketing agent in Adaa Liben and Lume Districts. The findings of the study showed that among these significant variables, co-operative price for teff, position in the co-operative, farm size, yield of teff, patronage refund and distance of the district market from the farmer’s house were found to be significantly and positively related to the farmers’ marketing of teff through the co-operatives.
GebruDesta(2007) in his study Competitive Advantage of Agricultural Co-operatives’ Services in Rural Areas of Tigray observed that agricultural co-operatives are legitimate institutions which belong to farmers. Their main activities are to render variety of services and access the market for input supply particularly to the rural community. The result of the survey further states that the trend of agricultural inputs supply in the study area is highly decreased in quantity of fertilizer, improved seeds and increased unit price almost from year to year.
AminiandRamezani (2008) investigated the factors involved in the success of poultry growers’ co-operatives in the selected provinces of Iran. The results indicate that the co-operatives studied have generally failed to achieve the objectives mandated in their constitutions which include their members’ satisfaction. The results from path analysis showed that the following factors, in descending order of importance, had the greatest effects on co-operative success: managers’ technical skills, number of training programmes attended, quality of training programmes offered, members’ participation in co-operatives’ administrative affairs and managers’ interpersonal human skills.
The studies reviewed so far have not analyzed the role of co-operatives in input and output marketing in the study area in particular and Ethiopia in general and hence the present study.
Research Questions
The research work is an attempt to find answers to the following questions.
1. Do members actively participate in the input and output marketing of multipurpose co-operatives?
2. Are there significant differences between the socio economic characteristics of participant and non participant members?
3. What are the factors determining members’ participation in the input and output marketing by multipurpose co-operatives?
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Objectives of the Study
In compliance with the research questions, the study has the following specific objectives:
1. To analyze the socio-economic characteristics of the co-operatives members.
2. To assess the nature and extent of participation of co-operative members in agricultural input and output marketing activities.
3. To identify the major factors influencing participation of co-operative members in agricultural input and output marketing activities.
Hypothesis of the Study
In line with the objectives, the following hypotheses have been framed by the researchers.
1. The participation of members of multipurpose co-operatives in input and output marketing is influenced by the shares held by the member household heads.
2. The participation of members of multipurpose co-operatives in input and output marketing is influenced by the distance to the co-operative office from the house of member household heads.
3. Educated members are evincing active participation in the input and output marketing of the co-operatives.
4. Fertilizer prices have positive influence on members’ participation in the input and output marketing by co-operatives.
METHODOLOGY
The study is based on empirical analysis. Hence field survey method was adopted.
Sampling Procedure
A multi-stage random sampling procedure was adopted for the selection of region, study area and the sample farmers from the co-operatives in the two Woredas. In the first stage, Tigray region was selected purposively on the justification that the region is beset with large number of agricultural co-operatives which are dealing with input and output marketing. As a second stage, out of five Woredas (Districts) in South Tigray Zone, two Woredas (Alamata and Ofla) were randomly selected for the purpose of the study.
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In the third stage, considering the total number of 27 multipurpose primary co-operatives (11 in Alamata Woreda and 16 in Ofla Woreda) as well as financial and time limitations, 10 primary multipurpose co-operatives were randomly selected from the two study woredas (four from Alamata Woreda and six from Ofla Woreda).
In the final stage, given the available resource and time at the disposal, a total of 208 farmer members (56 farmers from Alamata Woreda and 152 farmers from Ofla Woreda) were selected randomly using probability proportional to sample size (PPS).
Tools for Data Collection
Primary data was collected on age of respondents, marital status, sex of the household head, educational level, family size, family income, size of land holding, livestock ownership, duration of membership, awareness about co-operatives, contact with the co-operative leaders, participation in co-operative management, dividend payment, availability of credit, exposure to mass media, price of agricultural inputs, opinion on price of agricultural outputs, timely delivery of inputs, regular marketing service of co-operatives, distance of the house of the household head from primary multipurpose co-operative society, expenditure and other relevant variables from the sample respondents who are members of the primary multipurpose co-operatives selected for the study.
A structured interview schedule was developed to collect the needed primary data which comprised of both open ended and closed ended questions. The structured interview schedule was prepared for the purpose of conducting face-to-face interview with the respondents to elicit as much information as possible in pursuit of fulfilling the objectives of the study. The interview questions were developed by the researchers at their own by taking into account the nature of the business dealings (input and output marketing) held by the members with their co-operative society. The interview schedule was first prepared in English and translated into Tigrigna for practical field work. The interview schedule was pre-tested with 10 co-operative members before its actual administration.
Data Analysis
Descriptive statistics are important to have clear picture of the characteristics of sample units. By applying descriptive statistics one can compare and contrast different categories of sample units (farm households) with respect to the desired characteristics. In this study, descriptive statistics such as mean, standard deviation,
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percentages and frequency of occurrence were used along the econometric model, to analyze the collected primary data.
Probit Model Specification
To identify the factors influencing the participation of co-operative members in the agricultural input and output marketing business, binary Probit model was employed for this study. Therefore, the determinants of participation in the agricultural input and output marketing activity were estimated using binary Probit regression model. According to Maddala (2002) Probit model is specified as:
Ii* = α +δ Xi+ε
Where
I = 1 if I i* >1, the members participate in the agricultural input and output marketing by co-operatives.
I = 0 if I* i ≤ 0, otherwise X i are exogenous variables where i = 1, 2 …, 15. X1 = Age of household headX2 = Educational level of the household headX3 = Family size of the household head X4 = Land owned by the household headX5 = Number of oxen owned by the household headX6 = Livestock holding of the household head X7 = Share holding of the household head X8 = Non farm income of the household head X9 = Expenditure in agricultural inputs by the household head X10 = Distance to the co-operative office from the home of the household X11 = Perception of household head on price of agricultural output X 12 = Perception of the household head on change of standard of living due to
joining to co-operativesX13 = Membership of the household head in other co-operativesX14 = Perception of the household head on Fertilizer price X15 = Perception of the household head on improved seed priceδ is vector of parameters to be estimated; α is the intercept term; ε1i are the disturbance term
The Variance Inflation Factor (VIF) was used to test for the existence of multi-collinearity between continuous explanatory variables. VIF shows how the variance of an
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estimator “R” is inflated by the presence of multi-collinearity (Gujarati, 2004). If R2 is the adjusted square of the multiple correlation coefficients that results when the explanatory variable (Xi) is regressed against all the other explanatory variables, VIF is computed as VIF(X) = (1-R) i
1-2
As the adjusted R2 approaches 1, the VIF approaches infinity. That is as the extent of collinearity increases, the variance of the estimator increases, and in the limit it can become infinity. If there is no collinearity between independent variables, the values of VIF will approach 1. As a Rule of Thumb, values of VIF greater than 10 are often taken as a signal for the existence of multi- collinearity problem in the model (Gujarati,2004).
Contingency coefficients were also calculated to see the degree of association between the dummy variables. They were calculated for each pair of dummy variables using contingency coefficient procedure available in Statistical Packages for Social Sciences. Contingency coefficient is a chi-square based measure of association. A value of 0.75 or more indicates a stronger relationship.
RESULTS AND DISCUSSION
Socio-economic Characteristics of the Respondents
The average age of the sample farmers was about 43.2 years. The corresponding figure for the participant and non-participant farmers was about 42.4 and 45.0 years respectively. An independent sample t-test was conducted to compare the difference in mean age between participant and non participant sample respondents are statistically significant at 10% probability level of significance (t = 1.84) (Table 1). This indicates that more aged members do not participate in the input and output marketing activities of the co-operatives as compared with the less aged farmer members.
The average educational level of the sample households was 3.2 years of schooling. While the respective participant and non participant sample farmers average schooling is 3.5 and 2.7 years. According to the independent sample t-test, the difference mean t-test was compared between the participant and non-participant co-operative members with respect to educational level of the household head is found to be statistically significant at 10% probability level (t = -1.8) and the hypothesis has been accepted. This implies relatively educated member farmer members participate in the input
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and output marketing activities of the co-operatives. This can be due to the fact that educated farmer members have more exposure to timely information and understand about the co-operative marketing activities as compared to less educated members.
The mean family size of the sample household in the study was found to be 6.0. The respective average family size for participant and non participant household is 6.0 and 5.9 respectively Nonetheless, the analysis shows that, the mean difference between participants and non-participants of the agricultural input and output marketing by co-operatives with respect to family size is found to be statistically non significant (t = -0.834).
The average land ownership of the sample respondents were 0.67 hectare. Moreover, the corresponding figures for the participant and non-participant sample respondents’ amounts 0.7 and 0.5 hectare respectively. According to the independent sample t- test conducted in this study, the difference in mean land ownership between the participant and non participant household heads is found to be significant at 10% probability level (t = -2.48). Therefore, from this we can conclude that the majority of the sample farmers own more than half a hectare of land which is above the Woreda average (i.e. 0.5 hectare).
The average livestock holding for the sample households as a whole is 5.62 Tropical Livestock Unit (TLU) (Table 1). The average livestock holding of participants is relatively higher (6.0) than that of non-participants (4.6). An independent sample t- test was conducted to compare the mean difference in TLU owned between participants and non-participants of the agricultural input and output marketing by co-operatives. The result shows that there is statistical significant difference between the participant and non-participant households at 5% probability level (t = -2.38).
More importantly the average shareholding of the whole sample farmers, participant and nonparticipant farmer members amounts 2.2, 2.3 and 1.9 respectively. An independent sample t test was analyzed to compare the mean difference between the participant and non-participant households in the agricultural input and output marketing by co-operatives and the result shows statistically significance at 1% probability level (t = -2.99). This indicates, majority of the sample respondents 146 (70.2%) were participating in financing their co-operative societies through investing in the form of additional share capital.
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Table 1: Mean, STD, T-values Continues variables for Non-Participant and Participant Groups (N = 208)
Explanatory
Variables
Non- Participant
( N = 62)
Participant
( N = 146)
Total
( N = 208)
Sig. t
values
Mean
STD
Mean
STD
Mean
STD
Mean
STD
Mean
STD
Mean
STD
Age of HH 45.02 9.00 42.47 9.13 43.23 9.15 0.066* 1.84
Level of Education
of the HH
2.73 2.79 3.53 2.85 3.29 2.85 0.063* -1.87
Family size of HH 5.987 1.987 6.02 1.931 6.003 1.959 0.405 -0.834
Land owned by the
HH
0.57 0.37 0.72 0.44 0.67 0.43 0.014** -2.48
Number of oxen
owned by the HH
1.23 1.047 1.72 1.34 1.57 1.27 0.010** -2.58
TLU 4.59 3.47 6.06 4.31 5.622 4.12 0.018** -2.38
Nonfarm income
of the HH
3147 4776 2087 2106 2403.3 3172.7 0.098* 1.68
Expenditure on
input
247 229 323 284 300.45 270.6 0.066* -1.85
Number of share
holding by the HH
1.89 0.93 2.36 1.1 2.22 1.07 0.003*** -2.99
Distance from the
Co-operative office
3.52 3.10 4.43 3.71 4.16 3.56 0.090* 0.06
* Significant at 10% level of significance ** Significant at 5% level of significance*** Significant at 1% level of significance
Factors Determining the Participation of Members in the Agricultural Input and Output Marketing by Co-operatives
The estimates of parameters of the variables expected to influence the participation of farmer members in the agricultural input and output marketing by co-operatives are displayed on Table 2. Fifteen explanatory variables of which five are dummy variables and the remaining 10 are continuous explanatory variables were taken for the analysis. The result of the probit model analysis showed that 10 variables were found to be significant. The impact of these explanatory variables on the dependent variable is discussed below. Before running the model, it is useful to look into the problem of multicollinearity among the continuous variables and verify the degree of association among the hypothesized qualitative explanatory variables. To this effect, the 10 continuous explanatory variables were checked for multicollinearity using Variance Inflation Factors (VIF) while Contingency Coefficients were used to detect
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the degree of association among five qualitative (discrete) explanatory variables. According to the results, no significant problems of multicollinearity and very high degree of association were observed. Therefore, all the 15 hypothesized continuous and discrete explanatory variables were included in the model.
To start with, endogeneity was suspected in the case of perception of output price, perception of change in standard of living due to joining to the co-operatives, perception of fertilizer price and perception of improved seed price with the dependent variable participation of the household head in the agricultural input and output marketing by co-operatives as there is an increase in participation by the members in the input and output marketing due to those independent explanatory variables. On the other hand, households’ decision of participation depends on the price of output, price of fertilizer, improved seeds and change on the standard of living of the household head due to the participation in the input and output marketing by co-operatives.
Ageofhouseholdhead(AGEHH): Analysis of binary probit model as given in Table 2 reveals that the demographic explanatory variable namely age, has negative and significance effect at 10% probability level on the participation of members in the agricultural input and output marketing by co-operatives in the two study woredas between all categories of members (participant and non-participant). This result is in contrary to the finding of Subburaj and Karunakaran on the peoples’ perception on the social benefits of cooperation (Frank, 2003). This is an important finding that young co-operative members are more active participants in the agricultural input and output marketing by co-operatives. The probable reason for this could be young members might have more awareness about the benefit of co-operatives as compared to aged members.
LandownedbytheHH(LANDOWN): As it was expected, landholding has positively influenced the agricultural input and output marketing activity of co-operatives which is significant at five percent probability level. Each additional hectare of land increases the probability of purchasing agricultural input from the co-operative and selling of its agricultural outputs to their co-operative. Therefore, land ownership is an important variable in the input and output marketing participation of the household head. The result of this study was similar with to the findings of Daniel, 2006, as the farm size increases, the co-operative members patronize their co-operative society by purchasing and selling agricultural input and output respectively.
ShareholdingofHH(SHARHOL): The variable share holding had influenced the participation of farmer members in the agricultural input and output marketing by
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co-operatives positively and significant at five percent probability level as it was expected and hence the hypothesis is accepted. This implies that as the number of share holding of farmer members increases the level of participation in the co-operative affairs such as input and output marketing increases. The larger the share holding the greater will be the sense of ownership by the co-operative members which leads for more participation.
Non-farmincomeof theHH(NONFARNI): As expected the economic variable non-farm income has influenced the participation of agricultural input and output marketing by co-operatives negatively and significant at one percent probability level. Field survey result shows that, farmers earning high non-farm income are non participants in the agricultural input and output marketing by co-operatives because they don’t involve in the farming activity since they don’t have the land.
Distanceoftheco-operativeofficefromtheHHhouse(DCOFFH):This variable has influenced the participation in the agricultural input and output marketing by co-operatives positively and found to be significant at one percent probability level and hence the hypothesis has been accepted. It was expected that farmers, who are relatively nearer to the co-operative office, have the chance to participate more in the marketing activities of the co-operative. However, the model result shows that farmers who live far-away from the co-operative office have also increased their probability to participate in the agricultural input and output marketing co-operatives. This implies farmer members at relatively distant location have less alternative marketing agents as compared to those who live near the co-operative which are influenced by other private marketing agents. This result is in contrary with finding of Daniel, 2006.
PerceptionoftheHHonthepriceagriculturaloutput(OUTPP): This variable had influenced the agricultural input and output marketing of the co-operatives positively and significant at one percent probability level. These shows as the co-operative offers better price to its members agricultural produce the participation of members in selling their farm output to the co-operative increase. The result was in conformity with the finding of Daniel, 2006.
PerceptionoftheHHonthechangeinstandardoflivingduetojoiningaco-operative(CHSTDUCO): The variable change in standard of living due to joining a co-operative (becomes a co-operative membership) has negative and significant at five percent probability level. Therefore, the variable change in standard of living has negative contribution to the input and output marketing by co-operatives.
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Membership in other co-operatives (MOTHCOOP): Membership in other co-operatives i.e. other than the multipurpose co-operatives has positive and significance influence at 10 percent probability level in the agricultural input and output marketing by co-operatives. This implies that co-operative members who have a membership in other co-operatives have better understanding in participating in the co-operative affairs including in patronizing the co-operative business (such as input and output marketing business).
PerceptionoftheHHonfertilizerprice(FERPRICE):The variable fertilizer price influenced the participation of co-operative members in the agricultural input and output marketing by co-operatives negatively and significant at 10 percent probability level and hence the hypothesis has been rejected. This implies as the price of fertilizer increases the participation of the household head in purchasing fertilizer from the co-operative decreases.
PerceptionoftheHHonimprovedseedsprice(SEEDPRIC):The price of improved seed has influenced the dependent variable participation of co-operative members in the input and output marketing by co-operatives positively and significantly at 10 percent probability level which is contrary with what was expected. This implies farmer members in the two woredas participate more actively in the purchase of improved seeds as compared to other types of inputs regardless the price.
In general, the participation of farmer members in the agricultural input and output marketing by co-operatives was significantly influenced by age, own land, shareholding, non-farm income, distance of the co-operative office from the household house, output price, change in standard of living due to joining co-operative, membership in other co-operatives, price of inorganic fertilizer and price of improved seed. However, out of the 10 significant explanatory variables six of them (own land, shareholding, distance, output price, membership in other co-operatives and seed price) were influenced the participation of co-operative members in the agricultural input and output marketing by co-operatives positively and significantly at 10% probability level.
In Table 2 the last column, marginal effects of the explanatory variables on the probability of member’s participation in the agricultural input and output marketing by co-operatives are also presented. As we can see from the table, a unit change in the variables household age, non-farm income, change in standard of living and price of inorganic fertilizer decreased the probability of participation of farmer members in
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Table 2: Probit Regression Estimates of Determinants of Participation in Agricultural Input and Output Marketing by Co-operatives (N = 208)
Variables Coefficient Marginal EffectAge of HH in years -0.0403*
(0.0150)-0.0121*(0.0045)
Educational level of the HH in years of schooling 0.0398(0.0437)
0.0120(0.0131)
Family size of the HH in number -0.0369(0.685)
-0.0111(0.0206)
Land owned by the HH in hectares 0.8618**(0.3385)
0.2603**(0.1013)
Number of oxen owned by HH in number 0.0401(0.1558)
-0.0121(0.0471)
Livestock holding of the HH in tropical livestock unit
0.0349(0.0496)
0.0105(0.0149)
Share holding of the HH in number of shares 0.3052**(0.1235)
0.0922**(0.0367)
Non farm income of the HH in birr -0.0001***(0.0000)
-0.00003***(0.0000)
Expenditure in agricultural inputs by the HH in birr
-0.0005(0.0004)
-0.0002(0.00013)
Distance to the co-operative office from the home of the HH kms
0.0632**(0.0323)
0.0191**(0.0098)
Perception of the HH on price of agricultural output dummy
0.6539***(0.2454)
0.1883***(0.0660)
Perception of the HH on change of standard of living due to joining to co-operatives dummy
-0.5405**(0.2349)
-0.1702**(0.0758)
Membership of the HH in other co-operatives dummy
0.4155*(0.2211)
0.1251*(0.0660)
Perception of HH on fertilizer price dummy -0.5658*(0.2912)
-0.1809*(0.0962)
Perception of HH on improved seed price dummy 0.6310**(0.2759)
0.1906**(0.0813)
Constant 0.9031(0.6451)
Pseudo-R2 0.2524LRX 2 (15) 63.98Prob >X2 0.000
***, **, and * indicates statistically significant at 1 percent, 5 percent and 1 percent probability level respectively.Figures in parentheses are standard errors
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the agricultural input and output marketing by co-operatives by 0.0121, 0.000035, 0.1702 and 0.1809 respectively. More importantly, one hectare of extra land owned by the household head increased the probability of participation of the household head in the agricultural input output marketing by co-operatives by 0.2603 units. Similarly, a unit change in the share holding of the household head increased the probability of participation in the agricultural input and output marketing by co-operatives by 0.0922. As clearly shown in Table 2, a one km change in the distance of the co-operative office from the house of the household head also shows an increased probability of participation in the input and output marketing by the co-operatives, which is in contrary with the findings of Daniel (2006).The plausible reasons for this is no matter with the distance farmer members prefer to do business with their co-operative society. One birr change in the price of agricultural produces marketed to the co-operative society by its members results an increase of the probability of participation in the agricultural input and output marketing by co-operatives by 0.1883 units. Similarly one birr change (lower) in the improved seed price increased the probability of participation of the co-operative members in the agricultural input and output marketing by co-operatives by 0.1906 unit and a unit change in the membership in other co-operatives increased the probability of the household head in the participation of in the input and output marketing by co-operatives by 0.1251 units.
As it has clearly shown in Table 2, the overall fit of the model has also quite well with LR chi square value of 63.98 and Prob > chi square = 0.00. The model explains 25.2% of the variations in the participation of agricultural input and output marketing by co-operatives.
CONCLUSION
From the foregoing analysis, it may be concluded that there are significant differences between the participant and non participant members in respect of age, land, tropical livestock unit, shareholding, non-farm income, expenditure in agricultural input, distance of the co-operative office from the household house, membership in other co-operatives and price of improved seed. The probit model results revealed that out of 15 explanatory variables included in probit model, six continuous and four discrete explanatory variables were found to be significant at less than or equal to 10% probability level. More specifically, these variables include age, own land, shareholding, non-farm income, distance of the co-operative office from the household house, perception of the household head on output price, perception of the household head on change in standard of living due to joining co-operative, membership in other
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co-operatives, perception of the household head on price of inorganic fertilizer and price of improved seed were found to be significantly related to the participation of farmer members in the agricultural input and output marketing by co-operatives. Further, among these significant variables own land, shareholding, distance, output price, membership in other co-operatives and seed price were found to be significantly and positively related to the participation of co-operative members in the agricultural input and output marketing by co-operatives.
Policy Implications
From the outcome of the analysis of the research work, a few suggestions have been put forth to enhance the participation of members in input and output marketing:
1. Most of the participant members feel that active participation and interest of the members is a sine-qua-non of any co-operative society. It is normal that some members will not show much interest in the affairs of their co-operatives apart from contributing their share capital, but there is a general consensus that unless members are active, co-operatives cannot prosper. There is, therefore, a clamor for throwing out the inactive members.
2. People generally feel that co-operative as a movement will succeed only if there is better knowledge and understanding of co-operatives. To that end, co-operative education needs to be improved. The education component of the activities of the Regional Co-operative Promotion Agency needs to be strengthened.
3. The need for autonomy in the management of co-operatives is emphasized. The elected board of management is expected to maintain political neutrality. Participatory management decision making in co-operatives is advocated. Members of co-operatives insist on enforcing management accountability by board of management including the executive heads. With a view to establish effective and efficient board of management in co-operatives, selective voting right to members is suggested.
4. There is a growing realization that many co-operative societies fail to live up to their expectations in fulfilling their core objectives. Provision of services that are needed by majority of members of co-operatives is emphasized during the field survey. There is a demand for avoidance of delay and delivery of prompt services. Adoption of simple and flexible procedures in availing the services of co-operatives is suggested.
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REFERENCESAmini, A.M. & Ramezani, M. (2008). Investigating the success factors of Poultry Growers’
Co-operatives in Iran’s Western Provinces, WorldAppliedSciencesJournal, 5(1): 81-87.
Daniel Belay. (2006). Performance of Primary Agricultural Co-operatives and Determinants of Members’ Decision to use as Marketing Agent in Adaa Liben and Lume Districts, UnpublishedM.Sc. Thesis inAgriculturalEconomics,Alemaya University, Ethiopia.
Dawit Alemu. (2005). The Status and Challenges of Agricultural Marketing in Ethiopia, MelkassaAgriculturalResearchCenter, EARO Paper presented at a panel discussion organized by the Ethiopian Association of Agricultural Professionals (EAAP), Addis Ababa, Ethiopia.
Federal Co-operative Agency (FCA). 2010. Annual Report for the year 2009/2010. UnpublishedDocument, Addis Ababa, Ethiopia.
Frank Ratna Kumar, Savarimuthu, A. & Ravichandran, K. (2003). ANewWorldthroughCo-operatives, Rainbow Publications, India.
Gebremeskel Dessalegn, T.S. Jayne, & J.D. Shaffer. (1998). Market Structure, Conduct and Performance: Constraints on Performance of Ethiopian Grain Markets, WorkingPaper8:GrainMarketResearchProject, Ministry of Economic Development and Cooperation, Addis Ababa, Ethiopia.
Gebru Desta. (2007). ‘Competitive Advantage of Agricultural Co-operatives’ Services in Rural Areas of Tigray, Ethiopia. UnpublishedM.Sc.Thesis,Department of Food Business and Development, National University of Ireland, Cork.
Gujarati. (2004). BasicEconometrics, Fourth Edition, Tata McGraw Hill Companies Inc. New York.
Haileselaqssie Girmay. (2003). The Benefits of Co-operative Membership: A Co-operative Study in Saesie Tsaeda Emba District, Tigray Region, Ethiopia. UnpublishedM.Sc.Thesis, Department of Food Business and Development, National University of Ireland, Cork.
Hind, A.M. (1994). Co-operatives: Underperformers by Nature-Explanatory Analysis of Co-operatives and Non-co-operative Companies in the Agribusiness Sector, Journal of AgriculturalEconomics. 45(2): 213-219.
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Kebede Manjur. (2006). Farmers’ Perception and Determinants of Land Management Practices in Ofla Woreda, Southern Tigray, Ethiopia, UnpublishedM.Sc.ThesisinAgriculturalExtension, Alemaya University, Ethiopia.
Kimberly A. Zeuli & Robert Cropp. (2004). Co-operatives:PrinciplesandPracticesinthe21st Century. Co-operative Extension Publishing, University of Wisconsin, Madison, USA.
Kraenzle, C.A. (1989). Farmer Co-operative: Members and Use. AgriculturalCo-operativeSocietyResearchReport77. USDA, Washington, D.C., U.S.A.
Maddala. (2002). Introduction toEconometrics,Third Edition, J. Wiley and Sons Ltd, England
Mitchell A. Seligson. (1987). Coffee Producers in Ecuador: A Comparison of Co-operative Members and Nonmembers, UnitedStatesAgencyforInternationalDevelopment, Quito, Ecuador.
Oxford Policy Management. (2003). Towards a Strategy for Support to Make Agricultural Markets Work Better for the Poor: The Grain Marketing System in Ethiopia, UK.
Tretcher, D.D. (1999). ImpactofDiversificationonAgriculturalCo-operativesinWisconsin,Agribusiness, USA.
AUTHORS’ BACKGROUND
Dr. R. Karunakaran (1966) is currently Assistant Professor in the Department of Co-operatives, Hawassa University Ethiopia. He has 18 years of experience in teaching, research, training, extension and industry in the fields of Cooperation and Co-operative Management. He has carried out number of research studies and written related articles. He has published more than 26 research and conceptual based papers in reputed Indian and International journals. He has published research papers in the edited books viz., Small Scale Industries-Problems, New World through
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Co-operatives and Information Technology – Its Application in Small Scale Industries. He is co-author of two books entitled, “Gender Issues in Co-operatives” and “Training and Development” and sole author of a book entitled, “Socio-Economic Impacts of Co-operative Movement in Rural Areas”. His current areas of research are Impact Assessment of Co-operatives, Functional Areas of Co-operative Management, and Co-operative Marketing.
Dr. Brehanu Borji (1959) is currently Assistant Professor in the Department of Management and Accounting, Hawassa University Ethiopia. He has 12 years of experience in teaching, research, training, extension and industry in the fields of Management and Marketing Management. He has carried out number of research studies and written related articles. He has published more than 2 research and conceptual based papers in reputed Indian and International journals. He has published research papers in the edited books viz., the Impact of liberalization on Ethiopian Cotton Textile Industry. He is a sole author of a book entitled, “Mathematics for Management. His current area of research is Impact of Liberalization on Ethiopian Leather Industry. Mr. Ahmedin Sherefa (1972) is currently Lecturer and Head, Department of Co-operatives, Hawassa University. He has 4 years of experience in the fields of teaching, research, extension and training. Prior to his teaching assignment, he served as administrator/head in several government organizations for about 15 years. He did his M.Sc. in Co-operative Marketing in Mekkele University, Ethiopia. He had undergone short term training on Development management and Thematic PRA in reputed Indian Institutions. He has completed so far two micro research projects funded by the Research and Development Directorate of Hawassa University. His current area of research is Co-operative Marketing.
ATTRIBUTES AND PERCEIVED SUCCESS FACTORS OF PERFORMING CO-OPERATIVES IN MALAYSIA
Nurizah Noordin Sushila Devi Rajaratnam
Mohd. Shahron Anuar SaidRafedah Juhan
Farahaini Mohd. Hanif
Co-operative College of Malaysia
ABSTRACT
Thispaperanalysestheattributesofselectedperformingco-operativesandexploredtheperceptiononthefactorsthathaveinfluencedthesuccessoftheseco-operatives.Foridentificationofthesuccessfactor,thesurveymethodisadoptedandatotalof567questionnaireswerecollectedfromindividualrespondents(BoardMembers)representing89selectedperformingco-operatives.Responseswerethenanalysedusingtheexploratoryfactoranalysis.Atotalofthree(3)factorswereextractedusingtheprincipalcomponentmethodwithavarimaxrotation.Thethreefactorrotatedexplainedatotalof54.38percentofthevarianceandallthefactorshadacceptablereliability.Thethreefactorsidentifiedweremanagerialcompetency,effective leadershipandsupport.Groupmeanscoreswerethencalculatedforthethreefactorstodeterminetheirimportanceindeterminingthesuccessof theperformingco-operatives.Subsequently,effective leadershipwasperceivedasthemostimportantfactorwiththehighestgroupmeanscore,followedbythefactor,managerialcompetency.Thefactor,supportwasperceivedtobethethirdmostimportantfactor.
Keywords:co-operatives,management,successfactor
INTRODUCTION
Co-operative was introduced in Malaysia in the early 1990s by the colonial government in response to credit and indebtedness problems of peasants, farmers and the civil servants (Frederics, 1973). Since the registration of the first thrift and loan co-operative in July 1922, the co-operatives sector, placed under the authority of the Malaysian Co-operative Societies Commission (MCSC) has become an important part of the economy and made major impact on the lives of millions of Malaysians. From only 11 co-operatives in 1922, as of 31 December 2009, the movement has
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registered 7,215 societies with a membership of 6.78 million people and total assets worth RM64.9 million (Table 1). These co-operatives have evolved from credit, agricultural and consumer function into a wide range of business activities covering banking, credit and finance, agriculture, housing, industrial, consumer, construction, transport and services.
Although the achievement in terms of numbers, membership size and asset accumulation portrayed that co-operatives have gained huge support and recognition, the co-operative movement currently contributes only slightly more than 1.4 percent to the Gross Domestic Product (GDP) of Malaysia. As such, while providing the best services to their members, co-operatives need to also strengthen their role within the context of national development. In view of this aspiration, the 2011-2020 National Co-operative Policy (NCP) have underlined strategies that will increase the participation of co-operatives in viable and high end economic activities to boost the contribution of co-operatives to achieve the targeted 5 per cent contribution to GDP by 2015 and 10 per cent by 2020.
In order for co-operatives to succeed economically and provide benefits to its members effectively, they would have to be influenced by certain critical factors. Whether driven by the management competency, leadership style or the activities undertaken, it would thus be enriching to discover the attributes of successful co-operatives and identify the important factors which are perceived to have contributed to their success. Identification of these factor could be used to establish a baseline of practices and guidelines for co-operatives to develop and to enhance their performance. It would also assist co-operative to focus their efforts on building the necessary capacity and competency in order to be successful. Correspondingly, identification of the success factors could provide guidance to the related agencies to which appropriate factors and actions they need to focus to stimulate co-operatives to be more successful.
REVIEW OF LITERATURE
In the context of co-operative, a combination of traditional financial measure and non-financial or subjective indicators would appear to be the best measure to reflect the performance of co-operative as a socio-economic entity (Parsley, 1992; Hind, 1997). While the combined measures of performance are deemed to be more appropriate, there are however, arguments that accounting based measures of financial performance are a sufficient predictor of performance (Brief and Lawson, 1992; Peasnell, 1996). For instance Kakani et al. (2001) have utilized accounting based measures for evaluating the performance of firms in India, using the return on
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asset (ROA), the net profit margin (NPM), the return on capital employed (ROCE), cash flow measure (CFM) and compounded annual asset growth rate (CAGR).
Kyriakopoulos, Meulenberg and Nilsson (2004) in their study of the impact of co-operative structure, firm culture and market orientation on performance also adopted the multidimensional construct of profit margin, market share, relative market growth while Mishra, Tegegne and Sandretto (2004) uses the modified net income per dollar of assets and operator‘s labor and management income as a performance measure. Ward and McKillop (2005) on their study of the linkage between the UK Credit Unions characteristics, location and their success on the other hand uses two financial indicators; the payout ratio (dividend and rebate percentage) and efficiency ratio (cost to income percentage) as a measure of success.
Correspondingly, highlighting the attributes and perceived important factors influencing the performing co-operatives would provide a better understanding of the link to their success. Although there are a variety of possible factors that influenced success, previous research categorized the factors as either organizational (internal) or economic (external) in nature (Hansen and Wernerfelt 1989). They cited that these two effects are independent, with organizational factors explaining twice as
Table 1: Number of Co-operative Societies in Malaysia (According to Sectors, as at 31 December 2009)
Function No. of Coop.
Members (individuals)
Capital Assets Turnover Profit/Loss
Banking 2 838,932 2,289,504,293 51,251,535,708 4,338,062,555 1,577,844,058
Credit/ Finance
575 1,963,054 4,170,086,940 7,180,092,477 1,367,606,347 348,108,617
Agriculture 1,362 289,484 244,317,272 1,256,095,986 613,878,566 123,113,737
Housing 107 89,182 133,356,559 406,619,034 36,442,571 164,698,774
Industrial 117 17,634 5,238,548 56,620,186 33,127,694 3,339,385
Consumer: (Adult)
1,681 670,908 279,481,976 1,127,480,418 791,900,262 56,451,623
Consumer: (School)
2,115 2,106,130 17,264,427 177,673,323 195,120,375 25,508,868
Construction 117 62,171 14,365,358 56,784,381 64,188,685 2,593,031
Transport 346 148,196 58,654,263 250,163,546 512,207,073 19,914,402
Services 793 598,084 1,753,250,727 3,236,209,436 966,475,435 341,347,245
Total 7,215 6,783,775 8,965,520,363 64,999,274,495 8,919,009,563 2,662,919,740
(Source: Malaysia Co-operative Societies Commission)
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much variance in profit rates, suggesting that organizational factors influence firm performance to a greater extent than economic factors.
Powell (1966) suggest that research on identification of success factors should focus on the firm specific qualities such as culture, relationships, leadership and capabilities. Likewise, Lynch and Giorgis (1997) posit that the characteristics of small business managers, such as age, education background, experience and management skills are important to the success of these organizations. In Ward and McKillop (2005), size, location and affiliation to the league are found out to be contributory factors to the success of a credit union.
As member based organisations, members’ involvement in their co-operatives is of paramount importance to the survival and success of co-operatives. In fact Amini and Ramezani, 2008; Lluch, Gomis and Jimenez, 2006 have dentified active member participation in the administration of co-operatives as a key factor influencing the successful performance of co-operatives. For co-operatives to succeed, it is also imperative that they are managed effectively by visionary and competent leaders who are capable of planning strategically for the continued survival of the co-operative. Prior studies (Carr, Kariyawasam and Casil, 2008; Carlberg, Ward and Holcomb, 2006; Henehan and Pelsue, Jr., 1986; Pathak and Kumar, 2008) has found that having strategic or long term plans was positively associated with successful co-operatives. Bruynis, Goldsmith, Hahn and Taylor (2001), identified the following variables; securing sufficient equity before start up, maintaining adequate business volume, keeping and distributing accurate financial records, previous co-operative experience and continued management training for both the board and manager as important to the success of agricultural marketing co-operatives in America. The importance of training is also highlighted by Pathak and Kumar (2008) which identified that lack of training in financial management and lack of understanding of co-operative concepts were among the main reasons for the failure of many co-operatives in Fiji.
A study by Amini and Ramezani, 2008 investigating the success factors of poultry growers’ co-operatives in Iran found that the following factors, in a descending order of importance, had the greatest effects on co-operative success: managers’ technical skills, number of training programmes received by managers and members, quality of the training programmes offered, members’ participation in the co-operative’s administrative affairs and managers’ interpersonal human skills. Henehan and Pelsue (1986) similarly found that two factors, management experience and adoption of
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multi-year plans had the most significant influence on co-operative success, measured by sales growth. Meanwhile result of the study by Carlberg et al. (2006) which sought to determine success factors for New Generation Co-operatives (NGC) suggest that “planning and development” factor (strong local leader, steering committee and feasibility study) and financing and costs (low operating costs and member capital base) factor are considered to be critically important by NGC managers.
Thus, the framework adopted for this exploratory study, structured based on the literature reviews and related researches are as in Figure 1 below. The conceptual framework defines the measures of performance employed and the attributes of the performing co-operatives that the study proposed to identify.
Figure 1: The Conceptual Framework
METHODOLOGY
The performance or success of co-operatives is assessed by using the three performance measures; the market measures (ROE), the accounting measures (NPM) and financial measures (ROA). This decision is also aligned with Rahman, 2001 which cited that a combined measure using revenue, profit and other variables would be appropriate to assess performance. All three (3) ratios are calculated for each 3,487 active co-operatives with complete 2008 audited financial data obtained from the MCSC. Each ratio was then given a score of 1 to 5 according to the 20% percentile. The performance of each co-operatives were then calculated and ranked based on the sum of these scores being the highest score 15 and the lowest score 3.
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Overall performance score of between 11 – 15 was taken as the range to reflect good performance. The cut off point of 11 was also used to ensure that a sufficient number of co-operatives of different sizes (large, medium, small and micro) could be identified for the purpose of conducting in depth analysis. 270 co-operatives (excluding co-operative with annual turnover below RM100,000) from different cluster undertaking various functions or activities were finally identified as the performing or successful co-operatives. For the purpose of conducting in depth analysis, 100 co-operatives were selected according to their ranking and as close as possible to the proportion of the number of performing co-operatives. (Sampling size as prescribed by Bartlett Kotrilk, Higgins, 2001) However, after screening for completeness and validity of data, the research finally managed to obtained usable data for 89 co-operatives.
As past research highlighted that the attributes of performing co-operatives would provide a better understanding of their link to success, the research thus intends to study the following characteristics; financial, membership, management practices and the profile of the people who have brought the co-operatives to success.
For the purposes of analysis on the attributes of the selected performing co-operative and the perceived success factor, survey using structured questionnaires were conducted with the Board Members and the management personnel/manager of the co-operatives. Three to six Board Members and managers who have served the co-operatives for more than one (1) year are selected as respondents. Evidentiary documents mainly from annual reports furnished by the co-operatives and MCSS were also used for the study.
Primary data for this study is collected in two stages:
i. At the preliminary stage, a set of questionnaire is used to explore responses from respondents related to the movement (board members, management staff and members of co-operatives as well as government officers supervising co-operatives) regarding factors that they perceived will influence the success of co-operatives. The preliminary set of questionnaire listed a number of perceived success factors mainly focusing on the internal environment, namely the management and the organizational characteristics. External factors, such as macroeconomic environment and market factors are not taken into account. A total of 203 responses were received and usable for analysis. Based on the feedback obtained from this preliminary study, the questionnaire for the final phase were drawn up.
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ii. At the final phase, two (2) sets of questionnaires were used to collect information from the co-operative, the Board Members and the managers of the selected performing co-operatives. Set 1 is structured to gather the background information of the respondents (Board Members) and their experience. Another section is designed to assess the perception of the respondents as to the important factors they perceived to influence the success or performance of their respective co-operative. This section requires the respondents to indicate their level of agreement for the 21 statements, using a 5 point Likert rating scale of 1 to 5, with 1 being for ‘not important’ and 5 for ‘very important’
Meanwhile set 2 is intended to obtain the background of the co-operatives, the participation of members in co-operative activities and assistance obtained from various agencies. This set is to be answered by the Secretary or Manager of the co-operatives.
A team of researchers were employed to personally meet the respondents at their respective co-operatives. The questionnaire for the study was then distributed, briefed, checked for completion and collected on the same day.
SCOPE OF STUDY
This paper is an exploratory study that is confined to only performing co-operatives throughout Malaysia of different sizes and activities. The performing co-operatives is selected from the 2009 database provided by the MCSC. School co-operatives and two banking co-operatives that is Bank Kerjasama Rakyat and Bank Persatuan were excluded from the study, Dormant and inactive (co-operatives which has not held their Annual General Meeting for two consecutive years) as identified by the MCCS and co-operatives which incurred net loss for the financial year were also removed from the basic databases.
FINDINGS AND DISCUSSION
Attributes of the Performing Co-operatives
On the whole a total of 30 large co-operatives (11.1%), 66 medium sized co-operatives (24.4%), 116 small sized (43.0%) and 58 micro sized co-operatives (21.5%) were rated as performing co-operatives (Table 1).
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Table 2: Performing Co-operatives, According to Overall Performance Score (OPS) and Size
Size of Co-operatives
No. of co-operatives with Overall Performance Score 11-15
Total % of Total
Score 15 14 13 12 11Large 2 3 5 11 9 30 11.1Medium 2 6 10 24 24 66 24.4Small 3 6 32 43 32 116 43.0Micro 3 8 16 12 19 58 21.5
Total 10 23 62 89 86 270 100
A majority of these 270 performing co-operatives are those registered under the consumer function (34.4%), credit function (20.4%) and service function (13.7). However in comparison to the total number of co-operatives under the respective function, co-operatives registered under transportation (10.1%) and credit (9.6%) has the most number being selected as performing co-operatives. On the other hand, although the number of consumer and agriculture co-operatives are large, only a small percentage were selected as performing co-operatives (Table 2).
Table 3: Performing Co-operatives, According to Function
Function Performing Co-operatives Sector
Number Percentage (%)
Percentage to Sector
Number of Co-op.
Credit 55 20.4 9.6 575Agriculture 33 12.2 2.4 1,362Housing 6 2.2 5.6 107Industrial 4 1.5 3.4 117Consumer 93 34.4 5.5 1,681Construction 7 2.6 6.0 117Transportation 35 13.0 10.1 346Services 37 13.7 4.7 793
Total 270 100 5098
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A more detailed analysis on the attributes of a selected sample of 89 performing co-operative, of which 17 (19.1%) are large, 26 (29.2%)are medium size, 29 (32.6%) small and 17 (19.1%) micro sized co-operatives are as follows:
(a) Size and Function
A majority of the selected performing co-operatives carried out agriculture function (20), followed by credit (19) consumer function (19) and services (16). Nine (9) of the selected co-operatives are involved in transportation. Two (2) out of the 89 co-operatives surveyed undertook the construction function while another four (4) co-operatives is in the housing function.
Table 4: Selected Performing Co-operative by Size and Function
Function No. of Coop
Sizes of Co-operativesLarge Medium Small Micro
Credit 19 7 4 7 1Agriculture 20 5 8 5 2Housing 4 2 1 0 1Consumer 19 1 5 8 5Construction 2 0 1 1 0Transportation 9 1 4 2 2Services 16 1 3 6 6
Total 89 17 26 29 17 (19%) (29%) (33%) (19%)
Most of the large size co-operatives selected for the analysis is involved in credit function while a majority of the medium size co-operative are involved in agriculture function. The smaller size co-operative selected are primarily involved in consumer and credit function, whilst most of the selected micro size co-operative is involved in the services and consumer function.
(b) Age (Longevity)
As reflected in Table 5, a total of 10 co-operatives (11.2%) were registered some 31-40 years ago while another 13 (15.7%) has been in operations for 41-50 years. Overall, 56.1% of the co-operatives surveyed has been in operations for more than 20 years.
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Table 5: Selected Performing Co-operatives by Age of Operations
No. Age (Year) No. of Co-operatives Percent (%)1 ≤10 19 21.32 11 - 20 20 22.53 21 - 30 13 14.6
4 31 - 40 10 11.25 41 – 50 14 15.7
6 > 50 13 14.6Total 89 100.0
With respect to function, the credit co-operatives surveyed are found to have been existence on average for 45 years. Similarly most of the agriculture and housing co-operatives selected as performing co-operatives has been in operations for more than 30 years. Although the construction and services co-operatives are relatively younger compared to the credit co-operatives, they have been in operations for more than 10 years.
Table 6: Selected Performing Co-operative Average Age and According to Function
No. Function Age Average No. of Co-operative1 Credit 45 192 Agriculture 32 203 Housing 42 44 Consumer Construction 21 195 Transportation 13 26 Services 18 9
Total 16 89
(c) Size of Membership
As depicted in Table 7, 55 out of the 89 co-operatives surveyed, mostly comprised of medium, small and micro size co-operatives have membership below 500 members, with four (4) medium, four (4) small and six (6) micro co-operatives having less than 100 members. One (1) large secondary size co-operative has 13 primary co-operative under it. Three (3) small and one (1) micro co-operatives however were found to have
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between 1001-10,000 members. On the whole, 76.4% of the selected performing co-operatives have a total membership of 1000 and below.
The large size co-operatives generally have larger membership size, some having more than 10,000 members. These are generally made up of the more longer established co-operatives such as credit and housing co-operatives. Six (6) large size credit co-operatives (3.4%) were found to have more than 10,000 members while one services co-operatives have membership more than 20,000.
Table 7: Selected Performing Co-operatives by Size of Membership
Number of Members
No. of Coop
Sizes of Co-operativesLarge Medium Small Micro
<100 15 1 4 4 6100 – 500 40 5 13 13 9501 – 1,000 13 0 3 9 11,001 – 10,000 15 5 6 3 110,001 – 20,000 3 3 0 0 0>20,000 3 3 0 0 0
Total 89 17 26 29 17
(d) Fulltime Employees
The statistics on the number of employees in the 89 co-operatives indicates that 13 co-operatives (14.6%) are fully managed by the Board Members (BOD). Among the co-operatives that do not employ any staff, 1 is from the medium size co-operative, 5 are small co-operatives while another 7 is the micro co-operatives. 52.8% of the selected performing co-operative hired 5 employees and less to manage their co-operative while another 12 co-operatives engaged between 6 – 10 employees. However, it is interesting to note that three (3) of the small performing co-operatives and one (1) micro co-operatives employs between 6 to 10 people to help run the co-operatives while one (1) particular micro co-operatives has between 11 – 15 employees. Generally only the medium and large co-operatives have the capacity to employ more than 15 employees, with 9 co-operatives having more than 20 employees. One (1) large co-operatives in particular has a total number of 229 employees (Table 8).
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Table 8: No. of Fulltime Employees Employed by Selected Performing Co-operatives
Number of Employed
No. of Coop
Sizes of Co-operativesLarge Medium Small Micro
0 13 0 5 71 – 5 47 0 21 86 – 10 12 3 3 111 – 15 5 3 0 116 – 20 3 2 0 021 – 25 3 3 0 0> 25 6 6 0 0Total 89 17 29 17
Table 9 indicates that the larger and medium co-operatives tend to have higher capacity to hire executive and managerial level employees. 74 people were engaged as general managers and managers for the performing co-operatives while another 145 people are engaged at the executive level (Assistant Managers/Executives/Supervisors), working for 32 of the 89 performing co-operatives. Although a few small and micro co-operatives have employees at the executive and managerial level, they are more inclined to engaged employees at the clerical level.
A total of 413 people worked as clerical staffs and another 181 as general workers. In summary, the 89 performing co-operatives have provided 813 employment opportunities at the managerial, executive and clerical level with the large and medium co-operatives generating 86.5% of the job opportunities.
Table 9: Number of Employees According to Size of Co-operatives
No. of Emp.
No. of Employees by Co-op SizeLarge Medium Small Micro
Gen. Manager 15 9 4 1 1Manager 59 29 15 12 3Asst Mgr/ Exec/ Supervisor
145 110 21 7 7
Clerical Staff 413 326 50 31 6General Workers 181 111 28 18 24
Total 813 585 118 69 41
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(e) Business Activities
Performing co-operatives operates a number of diverse activities ranging from financial, plantation, construction to service based activities. It was found that most of the performing co-operatives (32.6% or 29 co-operatives) surveyed run only one type of business activity. Overall, more than 50% of the performing co-operatives focused on 1-2 core business activities. A total of 20 co-operatives (22.5%) were found to carry out two types of business activities while another 23 co-operatives (25.8%) are involved in three different business activities. Only 16 co-operatives are identified to be involved in 4-5 different form of business There is however one (1) small sized co-operative carrying out six types of activities in a smaller scale.
Table 10: Number of Activities undertaken by the Selected Performing Co-operatives
No. of Activities
No. of Coops Percent Size of Co-operatives
Large Medium Small Micro1 29 32.6 4 6 12 72 20 22.5 4 7 4 53 23 25.8 4 6 9 44 11 12.4 5 3 3 05 5 5.6 0 4 0 16 1 1.1 0 0 1 0
Total 89 100.0 17 26 29 17
As to the types of activities, 35 co-operatives run services business including cleaning services and providing premises for rental. This is followed by plantation activity and contracting activity (31 co-operatives), while credit activity is undertaken by 25 of the performing co-operatives. Only a small percentage of co-operatives are involved in the petrol station business and farming activity.
Most of the large size co-operative are found to be involved in credit, investment and consumer activities. Meanwhile, the service and contracting activities is the more preferred business undertaken by the medium size co-operative. Smaller and micro size co-operative on the other hand focused their effort on contract, service, plantation and retail business.
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(f) Membership Growth
Overall, membership for the large and small and medium size co-operatives grew at a rate of 6% while the membership for the micro co-operatives grew at an average rate of 14.4%. As per function, the membership for the housing and construction co-operatives increased significantly, with housing co-operatives recording almost a 50% growth rate. Alternatively the membership for the agriculture and consumer co-operatives declined slightly (0.25%) in the year 2008. Nevertheless the membership for the credit, transportation and services co-operatives grew moderately at a rate of between 3% - 5%.
(g) Assistance and Support Received from Agencies
The study also investigated the types of assistance and support received by the performing co-operatives from different agencies, especially those related to the co-operative sector. On the whole, almost all of the performing co-operatives have received some form of assistance and support from different organizations, financially or otherwise.
It was found that 91.0% of the co-operatives (81 out of 89) received assistance and support from MCSC particularly in the form of financial aids and soft loans and majority of the co-operatives have also at one time received assistance from the MCSC in terms of annual auditing services. 75% of the co-operatives surveyed received assistance from CCM, mainly in the form of training and consultancy services. Similarly 74.2% of the sampled co-operatives have received support from ANGKASA in the form of member education and training programmes plus assistance in the form of pre-audit services and IT hardware’s and software’s supplies. A total of 39 co-operatives also indicate that they also received assistance/support from other agencies and state based agencies in the form of financial aids, specialized training programmes, technical and marketing support.
(h) Members Fund and Dividend Payout
The total members fund accumulated by large co-operatives is mostly made of the shares and subscription contributed by members (72%). The remaining amount is made up of various funds set up for members benefit, such as members education fund, members benevolent fund and retained earnings. Conversely, the shares and subscription contributed by members of micro co-operatives only form 37% of their members funds.
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Table 11: Members Fund of Selected Performing Co-operatives, According to Size
Size No. of coop
Total Member’s
Fund
Total Share Capital +
Subscription
Ave Div. P/out
RM % %Large 17 3,332,831,130 2,412,051,323 72 16Medium 26 69,986,693 34,028,965 49 13Small 29 36,453,983 23,690,485 65 15Micro 17 5,242,572 1,958,498 37 19
As credit co-operatives obtained most of it’s financing from internal sources, the main portion of it’s members fund is in the form of shares and subscription (72%). Services co-operatives also has a large fraction of it’s members fund in the form of share capital and subscription (83%). Comparatively, the agriculture, housing, consumer, construction and transportation co-operatives, the shares and subscription contributed by members only ranges from 14% to 38%.
Although the percentage of shares and subscription to total members fund is small, the micro co-operatives are found to have paid the highest average dividend payouts (19%). This is followed by the large co-operatives which gave dividend return of 16%. Small co-operatives annual average dividend payout is 15% while the medium co-operatives on average paid out 13% dividends to its members. Credit co-operatives which have a sizeable amount of shares and subscription are observed to have the lowest average dividend payout (7%). Relatively, services co-operatives paid an average dividend of 12%. The highest dividend payout is given out by the construction and consumer co-operatives, 20% and 15% respectively.
(i) Allocation for Members Benefit
Besides dividend, co-operatives normally allocate part of their annual profit in the form of specific funds to improve the social well being of its members. It is observed that in almost all of the performing co-operatives have increased their allocation towards members benefit except for co-operatives under the services function. This increasing trend is probably in response to the higher profit recorded in the respective year (2008/2009).
However, the percentage increase in members’ allocation is higher compared to the increase in the profit experienced by the various function. For example, although the
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average net profit for the agriculture co-operatives grew 89%, the average growth in the amount allocated for members benefits soared more than 100%.
Similarly, the housing co-operatives on average allocated 33% of their profits for members, compared to the their average growth of 18%. The credit, agriculture and industrial co-operatives are the top three functions with the biggest amount of contribution to members’ benefit fund. The amount of allocation for the agriculture co-operatives also shows an upward trend, in line with the increase in it’s income and net profits. On the contrary the services co-operatives allocation to members’ benefit increased a slight 4% despite recording a average growth of 24% in income and 12% in net profit.
(j) Members Participation
The participation of members in the selected co-operatives are gauged by assessing the percentage of their attendance at the annual general meeting(AGM) and the extent of members patronizing the co-operative activities. More than 50% of the selected co-operatives stated that 81% to 100% of their members attended the AGM. Meanwhile 25 co-operative (28.1%) declared that only 61% to 80% of their members attended the AGM whilst another 12 co-operative (13.5%) indicated that the attendance rate is between 41% to 60%. Only 4 co-operative (4.5%) reported poor rate (21% to 40%) of members attendance at AGM.
Meanwhile as to the estimated level of members’ patronage towards the services and products offered by the co-operatives, 57 co-operatives (64%), indicated a very high to high level of members patronage. On the other hand 26 co-operative (29.2%) stated that members’ patronage is in the medium level while only 6 co-operative indicates that they received poor response from the members’ towards the services and product offered by the co-operative.
Factors Perceived to Influence the Performance of Co-operatives
This section presents the demographic characteristics of the respondents surveyed and the respondents perception on the factors that have influence the success of their co-operatives. A total of 567 questionnaires were collected from individual respondents (Board Members) representing the 89 selected performing co-operatives.
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(a) Profile of Respondents
A majority (80%) of the respondents surveyed were male. A total of 57.1 percent of the respondents were between 41 years old to 60 years old while another 27.3 percent were 61 years above. A further 14.3 percent of the respondents were between 21 years old to 40 years old. Only 7 or 1.2% of the respondents surveyed were below 20 years old. In general, the age of most of the board members of the selected performing co-operatives is between 41 to 60 years old.
Table 12: Respondents’ Profile by Age
Age Frequency Percentage (%)20 years and below 7 1.2%
21 – 40 years 81 14.3%41 – 60 years 324 57.1%
61 years above 155 27.3%Total 567 100%
Out of the 567 respondents, a total of 249 of the Boards Members were elected less than 5 years while another 39.2 percent has served the co-operatives between 6 to 15 years. A further 16.4 percent of the Board Members has served the co-operatives for more than 15 years.
Table 13: Respondents’ Profile by Years of Experience
Years of Experience Frequency Percentage (%)5 years and below 249 43.9
6 to 15 years 222 39.2 16 to 25 years 62 10.926 to 35 years 17 3.0 35 years above 14 2.5
Total 567 100
In terms of educational background it is found that 58.6% of the respondents possessed secondary level education and below while 41.4% of the respondents have acquired tertiary education and above.
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Table 14: Respondents Profile by Qualification
Educational Qualification Frequency Percentage (%)Secondary Education 332 58.6A Level / Matriculation and Equivalent 30 5.3Diploma 79 13.9Bachelor Degree 83 14.6Master Degree 26 4.6Doctorate / PhD 6 1.1Professional Qualification 11 1.9
The table below indicate the number of respondents who have attended job related training programs for the year 2007, 2008 and 2009. A total of 264 respondents in 2007, 260 respondents in 2008 and 268 respondents in 2009 attended 1 to 3 training program per year. It was however found that a large number of the respondents have not attending any job related training programs for the past three years.
Table 15: Job Related Training Programmes Attended
Total Course 2007 2008 2009Not attending any course 245 250 2431 – 3 courses 264 260 2684 – 6 courses 47 45 477 – 9 courses 4 7 410 courses above 7 5 5
(b) Factors Perceived to Influence the Performance of Co-operatives from the
Perspective of the Board Members
To identify the important factors perceived by the board members to have influenced the success or performance of their co-operatives, the exploratory factor analysis was used. The suitability of data for factor analysis was assessed, using the correlation matrix and the Kaiser-Meyer-Olkin measure (KMO). An examination of the correlation matrix indicated that correlation between a considerable number of the variables exceeded 0.30, while the KMO value was 0.922 exceeding the recommended value of 0.6 (Pallant, 2002) and the Barlett’s Test of Sphericity reached statistical significance. The data was thus deemed suitable for factor analysis.
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A total of twenty items were then subjected to factor analysis using SPSS for Windows (version 15). Factoring ceased when all Eigenvalues of greater than one were obtained and when a set of factors explaining a substantial percentage of the total variance was achieved. An accepted method of interpretation of factor loadings is to regard significant any variable or item with a loading of 0.4 or greater as associated with the appropriate factor (Hair, Black, Babin, Anderson and Tatham, 2006). Hence 0.4 was used as the cut-off point to determine the number of items that loaded on to a factor.
The factors were extracted by using principal component method with a varimax rotation. The rotated component matrix presented in Table 16 revealed three factors with all items or variables showing strong loadings (more than 0.4) and loading substantially on only one factor or component. The three factor rotated explained a total of 54.38 percent of the variance, with Factor 1 contributing 20.55 percent, Factor 2 contributing 18.0 percent and Factor 3 contributing 15.8 percent. The seven variables or items with strong loadings on Factor 1 explained 81.65% of the variance in this factor, while another seven variables that loaded strongly on Factor 2 explained 83.1 percent of the variance in the second factor. Lastly, the six variables that loaded strongly on Factor 3 explained 69.15 percent of the variance in this factor.
Reliability analysis using Cronbach’s alpha was carried out to examine the internal consistency of the three factors. As a general guideline, Cronbach’s alpha coefficient of at least 0.7 is considered acceptable Specifically, the Cronbach’s alpha coefficient values for the three factors were 0.878, 0.844 and 0.761 as shown in Table 16, indicating that all three factors had good reliability.
The three factors were also labelled to aid interpretation. The seven items that loaded strongly, using factor loading of at least 0.4 as proposed by Hair et al. (2000, 2002). The Factor 1 relate to the competencies, required by the management team to manage performing co-operatives successfully specifically, experience, skills, efficiency, continuity of service and cooperation among the board and employees. As a result this factor was named, ‘Managerial Competency’. The seven items had factor loadings ranging from 0.437 to 0.848. The three items with very high loadings of more than 0.8 and are very closely related to the factor, are experienced, skilled and efficient senior staff of co-operatives. This finding underscores the importance of co-operatives employing competent staff in order to be successful.
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Table 16: Factors Perceived to Influence Performing Co-operatives
Variable/Item
Factor1
Managerial Competency
2Effective
Leadership
3Support
1 Experienced senior* staff of the co-operative 0.848
2 Skilled senior staff of the co-operative 0.834
3 Efficient senior staff of the co-operative 0.8014 Continuity of managers / supervisors 0.6345 Cooperation between board members and staff of
the co-operative0.595
6 Experienced board members of the co-operative 0.5897 The co-operative emphasises education and
training0.437
8 Honest, trustworthy and transparent board members and senior staff of the co-operative
0.781
9 The co-operative maintains good financial management
0.685
10 Visionary board members and senior staff of the co-operative
0.678
11 Board members and senior staff of the co-operative who can deal effectively with problems and challenges
0.674
12 Board members and senior staff of the co-operative who can communicate effectively
0.660
13 Cooperation among board members 0.595
14 Board members and senior staff with positive attitude
0.456
15 Members’ attendance at the Annual General Meeting
0.715
16 Support from the relevant agencies such as SKM, MKM and ANGKASA
0.618
17 Diversification of the co-operative’s activities 0.60918 Sufficient internal funds (shares, subscriptions) 0.57319 Members’ support towards the co-operative’s
products or services0.549
20 Continuity of Board Members 0.543
Eigen values 4.111 3.600 3.165
% of variance explained 20.555 18.000 15.823Cumulative variance explained (%) 20.555 38.555 54.378
Reliability (Cronbach’s Alpha) 0.878 0.844 0.761
*Senior staff refer to manager, executive and supervisor employed by the co-operative
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Factor 2 also had seven items with strong loadings ranging from 0.456 to 0.781. These items relate to leadership traits and skills that were regarded as important for board and senior staff of performing co-operatives to possess. Specifically, the items pertaining to leadership traits that loaded strongly were honesty, trustworthiness, transparency, being visionary and positive attitude. In addition, items concerning leadership skills that loaded strongly on the second factor were maintaining good financial management, ability to deal effectively with problems and challenges, ability to communicate effectively and cooperate amongst the board members. Accordingly, the Factor 2 was thus referred to as ‘Effective Leadership’.
Finally, the third factor had six items with strong loadings ranging from 0.543 to 0.715. The six items are concerned with various types of support given by members, related government agencies and board members. In particular members’ support is in the form of attendance at the co-operatives’ annual general meetings, patronising the products or services and contributing sufficient funds in the form of share capital and subscriptions. Meanwhile Board members’ support would be in the form of continuity of board positions and ensuring co-operatives’ activities are catered to the differing needs of members. Support from the government agencies related to co-operative development such as the Malaysian Co-operative Societies Commission (MCSC), Co-operative College of Malaysia (CCM), ANGKASA, Majlis Amanah Rakyat (MARA), Federal Land Development Authority (FELDA), Federal Land Consolidation and Rehabilitation Authority (FELCRA), Rubber Industry Smallholders’ Authority (RISDA) and Bank Kerjasama Rakyat in the form of loans, grants, training, advisory/consultancy services and technical assistance is also considered as important elements. This factor was therefore named ‘Support’.
Respondents’ opinions on the level of importance of the three perceived factors associated with performing co-operatives as well as the level of importance of the corresponding variables within each factor were obtained, using a 5-Point Likert type Scale ranging from 1 (not important) to 5 (very important). For the purpose of analysis, it was decided that if a factor or variable has a mean score of at least 4 on the Likert type scale means the respondents perceive the factor or the variable to be important for the successful performance of co-operatives in Malaysia. The resulting mean scores for the three factors and their variables are shown in descending order in Table 17.
As shown, the factor Effective Leadership was perceived as the most important factor with the highest group mean score of 4.62, followed by the factor, Managerial
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Competency with a group mean score of 4.39. Subsequently, the factor, Support was perceived to be the third most important factor with a group mean score of 4.34.
Within the factor, Effective Leadership, all seven items or variables were perceived to be important as indicated by their individual item mean scores which exceeded 4 and ranged from mean scores of 4.49 to 4.81. Incidentally, the first item in the Effective Leadership factor, ‘honest, trustworthy and transparent board members and senior staff of the co-operative’, with the highest mean score of 4.81 was perceived to be the most important variable within the first factor as well as among the twenty variables. Further, the item, ‘the co-operative maintains good financial management’ in the first factor was perceived to be the second most important variable (mean score of 4.77) within the factor as well as among the twenty variables included in the study.
Both these items reflect the perception that it is very important to have good governance in the management of co-operatives to ensure that they are successful. The item in the Effective Leadership factor, ‘cooperation among board members’ had the third highest mean score of 4.65 and was perceived to be the third most important variable. As leaders and policy makers in co-operatives, it cannot be denied that board members should have good cooperation amongst themselves so that the co-operatives’ objectives are achieved successfully.
All seven variables or items in the factor Managerial Competency were also perceived to be important based on their high individual item mean scores, ranging from 4.15 to 4.59. The item, ‘cooperation between board members and staff of the co-operative’ had the highest item mean score of 4.59 in the factor, followed by the item, ‘efficient senior staff of the co-operative’ with the second highest mean score of 4.53 in the Managerial Competency factor. The item with the third highest mean score of 4.40 within this factor is ‘experienced senior staff of the co-operative’ and finally, ‘skilled senior staff of the co-operative’ came close with having the fourth highest mean score of 4.37.
Based on the individual item mean score of 4.59, ‘cooperation between board members and staff of the co-operative’ was perceived to be the most important item in the Managerial Competency factor. One possible reason for this perception is that board members are the policy makers of co-operatives and it is vital that they have good cooperation with staff to ensure that policies are implemented efficiently and effectively for the benefit of the co-operatives. Moreover, efficient, experienced and skilled senior employees were perceived to be more important than experienced board members. A reason for this perception could be that generally, board members
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Table 17: Ranking of Factors Perceived to Influence Success of Performing Co-operatives
Factor No / Label Group Mean Score
Items/Variables Individual Item Mean Score
1 (Effective Leadership)
4.62 Honest, trustworthy and transparent board members and senior staff of the co-operative
4.81
The co-operative maintains good financial management
4.77
Cooperation among board members
4.65
Visionary board members and senior staff of the co-operative
4.58
Board members and senior staff of the co-operative who can deal effectively with problems and challenges
4.57
Board members and senior staff with positive attitude
4.51
Board members and senior staff of the co-operative who can communicate effectively
4.49
2 (Managerial Competency)
4.39 Cooperation between board members and staff of the co-operative
4.59
Efficient senior staff of the co-operative
4.53
Experienced senior staff of the co-operative
4.40
Skilled senior staff of the co-operative
4.37
Experienced board members of the co-operative
4.36
The co-operative emphasises education and training
4.35
Continuity of managers / supervisors
4.15
3 (Support) 4.34 Support from the relevant agencies such as SKM, MKM and ANGKASA
4.54
Sufficient internal funds (shares, subscriptions)
4.54
Members’ attendance at the Annual General Meeting
4.46
Table 17: cont.
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serve co-operatives on a voluntary capacity unlike senior staff who are employed full time to manage the business operations of co-operatives. Hence the perception that efficient, experienced and skilled senior staff are more important than experienced board members for co-operatives to perform well.
The third factor, Support has six items or variables, all of which were perceived to be important, based on their high individual item mean scores, ranging from 4.15 to 4.54. Two items in this factor, ‘support from the relevant agencies such as MCSC, CCM and ANGKASA and ‘sufficient internal funds (share and subscriptions)’ received the highest mean score of 4.54 and were thus perceived to be the most important variables in this factor.
The item with the second highest mean score of 4.46 in the Support factor was ‘members’ attendance at the annual general meeting’. The fact that support from the government agencies related to co-operative development was perceived to be very important denotes that co-operatives are still dependent on the government for their growth. In addition, members’ contribution in the form of shares and subscriptions as well as, their attendance at the annual general meetings suggest that members’ support is perceived as being crucial for co-operative success. By attending annual general meetings, members are able to participate directly in making decisions concerning the activities of their co-operatives.
CONCLUSION
The findings from this study indicates that a majority of the performing co-operatives are those registered under the consumer, agriculture, credit and service function. A more detailed analysis on the attributes of a selected sample of 89 performing co-operative reveals that most of the large size co-operatives is involved in credit function while a majority of the medium size co-operative are involved in agriculture
Diversification of the co-operative’s activities
4.19
Members’ support towards the co-operative’s products or services
4.18
Continuity of Board Members 4.15
Factor No / Label Group Mean Score
Items/Variables Individual Item Mean Score
Table 17: cont.
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function. The smaller size co-operative are primarily involved in consumer and credit function, whilst most of the selected micro size co-operative is involved in the services and consumer function.
Overall, more than half (56%) of the selected performing co-operatives surveyed has been in operations for more than 20 years. A total of 76.4% of the selected performing co-operatives have a total membership of 1000 and below. On the other hand the larger and more longer established credit and housing co-operatives generally have larger membership size, some having more than 10,000 members. The larger and medium co-operatives also tend to have higher capacity to hire executive and managerial level employees. Although a few small and micro co-operatives have employees at the executive and managerial level, they are more inclined to engaged employees at the clerical level.
Although the selected performing co-operatives operates a number of diverse activities ranging from financial, plantation, construction to service based activities, most of them focused only on 1-2 core business activities. To run their business operations, almost all of the performing co-operatives have received some form of assistance and support from different organizations, financially or otherwise.
The findings also indicates that the micro co-operatives are found to have paid the highest average dividend payouts (19%) followed by the large co-operatives (16%). The higher dividend payout rate is probably given out by micro co-operatives as it involves a smaller monetary amount and membership compared to that of large co-operatives. Small co-operatives annual average dividend payout is 15% while the medium co-operatives on average paid out 13% dividends to its members. It is also observed that there is an increasing trend in the amount of allocation made towards members benefit. In fact the percentage increase in members’ allocation is higher compared to the increase in the profit experienced by the various function. Feedback from the respondents also indicates that overall the participation of members, in the form of attendance at the annual general meeting (AGM) and the extent of members patronizing the co-operative activities was satisfactory.
The key findings from this study, drawn out from the performing co-operatives Board Members viewpoint are three main factors deemed to be influential to the success of their co-operatives; managerial competency, effective leadership and support. In terms of importance, effective leadership was perceived as the most important factor, followed by the factor managerial competency. Support in various forms received
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by co-operatives from different entities are considered as the third most important factor to have influenced performance.
Successful co-operative creation often depends on the capability, commitment and support of leaders who are actively engaged in the operations of the organization. While the personality, education and management experience of these leaders may differ, they have commitment, vision and determination in common. Whoever they are, visionary and effective leaders are regarded as significant factors which could influenced the success of performing co-operatives. Therefore, to be successful, co-operative leaders need to possess specific leadership traits such as honesty, trustworthiness, transparency, charismatic and have the ability to shape opinion and their vision with co-operative members. Equally important, co-operative leaders need to maintain good financial management, have the ability to deal effectively with problems and challenges, capable of communicating effectively and cooperate amongst the board members. Faced by the challenging business environment, co-operative leaders must also possess entrepreneurial competencies and business related skills, or have access to those skills in their key employees.
Competent management team which comprise of the Board Members, managerial and senior staffs is viewed as central to the achievement of the performing co-operatives. Although the relationship between the board and the manager of a co-operative is complex and dynamic, their roles should be clear, the board sets broad policy and strategy, the manager implements. Thus, to manage co-operatives successfully the management team specifically requires related work experience, skilled and efficient senior staff, continuity of service and strong cooperation among the board and employees. A competent management team that is experienced in the appropriate field, trained and able to communicate well internally and with the members was also deemed important to the success of co-operatives.
Finally, support given by members, related government agencies and board members are deemed to be important to the success of these performing co-operatives. Members’ support in the form of attendance at the annual general meetings, patronizing the products or services and contributing sufficient funds whilst continuity of board positions are essential factors that help sustain the performance of co-operatives. Consecutively, support from agencies and related organization in the form of loans, grants, training, advisory/consultancy services and technical assistance would also be valuable to the development and accomplishment of a co-operative.
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Summing up, drawn from the findings of this exploratory study is a proposed model for the factors influencing the performance or success of co-operatives. Further research, both qualitative or quantitative in nature could be carried it to investigate these initial findings influence on the performance or success of co-operatives.
Figure 2: Proposed Model “Factors Influencing the Success of Co-operatives”
ORGANISATIONALATTRIBUTES
VISIONARY AND EFFECTIVE
LEADERSHIP
MANAGEMENT COMPETENCY
SUPPORT AND ASSISTANCE
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Azmah Othman & Fatimah Kari. (October 2008). Enhancing Co-operative Movement to Achieve Malaysia’s Development Goals. In ICAResearchConference‘TheRoleofCo-operativesinSustainingDevelopmentandFosteringSocialResponsibility’. Italy: Trento.
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AUTHOR’S BACKGROUND
Nurizah Noordin is the Director of the Accounting and Finance Centre at the Co-operative College of Malaysia (CCM). She holds a Masters in Business Administration (Finance) from Universiti Putra Malaysia, Advanced Diploma and Diploma in Business Studies from Universiti Teknologi MARA, Malaysia. She joined CCM in 1983 and is an experienced trainer in financial management, accounting, auditing and business management. She also provides advisory service to co-operatives in these areas. In addition she has undertaken a number of research studies related to co-operative management.
Dr. Sushila Devi Rajaratnam currently is the senior lecturer at the School of Hospitality Management, Taylor’s University. She holds a Ph. D. in Management from Multimedia University, Malaysia, Masters in Business Administration and Bachelor in Economics with Honours (Business Administration) from University of Malaya, Malaysia. Besides teaching, has undertaken a number of research studies and written journal articles related to Human Resource Management and Organizational Behavior.
Mohd Shahron Anuar Bin Said has been a lecturer with the Accounting and Finance Centre, Co-operative College of Malaysia (CCM) since 2004. He holds a Masters in Business Administration and Bachelor in Accounting from Universiti Kebangsaan Malaysia. Besides being an experienced lecturer in accounting, auditing and financial management, he provides advisory service to co-operatives and has been involved in research studies in these areas.
Rafedah Juhan joined the Co-operative College of Malaysia (CCM) in 2004 and is an experienced lecturer in accounting, auditing and financial management. She holds a Masters in Business Administration from Universiti Malaysia Sabah and Bachelor of Accounting from Universiti Kebangsaan Malaysia.
Farahaini Mohd Hanif has been with the Accounting and Finance Centre, Co-operative College of Malaysia (CCM) since 2006 and is a lecturer in accounting, auditing and financial management. She holds a Masters in Accounting and Bachelor in Accounting with Honours from Universiti Teknologi MARA, Malaysia.
INDICATORS OF GOOD GOVERNANCE PRACTICES IN SELF EMPLOYED WOMEN’S SACCOS UNION IN ADDIS
ABABA, ETHIOPIA – AN EXPLORATORY STUDY
M. Karthikeyan
HawassaUniversity,Ethiopia
ABSTRACT
Theco-operativegovernanceconceptrelatestothequalityoftherelationshipbetweenthegovernmentandthecitizensie.,theco-operativesystemanditsmembersforwhomitexiststoserve,promoteandprotect.Theindicatorsforgoodgovernanceinco-operativesarecompiledwithcorporatecultureandethicalclimateinco-operatives.ThepresentstudyisauniqueattemptinEthiopiancontext.TheSACCOsareflourishinglikeanythingandthesefinancialco-operativesshouldthinkofgoodgovernancepractices.Thestudyattemptstoanalyzetheindicatorsofgoodgovernancepracticeinselectedself-employedwomenSACCOsunionlocatedatAddisAbaba.Surveymethodwasadopted.Themajorfocuswasdifferentstakeholdersoftheunion-members,boardmembers,representativeofmemberco-operatives,paidmanagement.Twostagesamplingprocedurewasemployedforthestudy.ExceptmembersoftheSACCOunion,otherstakeholderswereselectedoncensusbasisi.e.,allboardmembers,allrepresentativesfrommemberco-operatives,allpaidmanagementstaffwereselected.Semi-StructuredInterviewSchedulewasadministeredamongsamplestakeholders.Fromamongmembers4FDGswereconductedoncertaingovernanceissuesandGoodGovernanceIssuesReportCardalsoadministeredtogradethegovernanceindicators.Thedetailregardinggovernanceissuesreportcardisdovetailedinanalysispartofthisresearchpaper.
TheSelf-EmployedWomen’sSavingsandCreditCo-operativesUnionLtdisestablishedinJune2005by12primaryco-operatives.Currently,theunionhas19co-operativememberswith4,200individualmembers.Theunionisrenderingserviceslike,savingsandcredittomembers,provisionofloanslikehousing,schoolandgrouploans,administrationofmarketshelters,organizingtradefairs,exhibition,bazaars,insuranceserviceonloans,andadministratingincomegenerationventures.Asforgovernanceofthisunion,thememberrepresentativesfromprimaryco-operatives,boardofmanagement,membersandemployeeshaveadequateknowledgeaboutco-operativesandco-operativemanagement.Theyadheretotheco-operativeprinciplesandvalues.Theyarepracticingthefourpillarsofco-operativegovernance.Theypracticegovernancewithgoodgovernanceindicators.Theresultswillbeclearlyseeninthefullpaper.ThewomenSACCOunionisanexampleofgoodgovernancemodel/framework.Itcanbeamodelwomenco-operativesunion,whichpracticegoodgovernanceforcreatingabetterstandardforotherco-operativesinthecountry.
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BACKGROUND AND LITERATURE REVIEW
Governance is normally associated with the government. A State essentially consists of territory, population, government, and sovereignty. In the absence of any one of the above ingredients, the State would be incomplete, rather it will not be considered as a State. Governance characterizes a government, which is essentially a reflection of the quality of management by a set of people ordained with the powers and authority through codified or un-codified laws. The governance, therefore, implies the system and the way of regulating and managing an organization. The philosophy of democracy and egalitarianism brought in the concept of decentralization of powers. A large number of social, economic, cultural and political organizations and institutions came into existence as partners with the government in the delivery of goods and services to the population requiring their own systems and governance. Thus, the governance became a general concept of management and regulation.
A Co-operative society also on the analogy of a State has its defined area of operation (territory) is constituted by its members (population) on voluntary and mutual basis for their common good. It is managed by a board of directors (government) in accordance with its byelaws in consonance with the co-operative laws enacted by the State. Though a Co-operative society can’t be equated with the State as the sovereign power of State is absolute and which cannot be abrogated, yet some kind of autonomy within the over all frame work would be essential for any organization like a co-operative to discharge its obligations successfully (Bhagwati Prasad, 2003). A congenial environment with enabling legislation should, therefore, be the essential attribute of a government policy.
Co-operative Governance – A Historical Perspective Cooperation emerged as an anti thesis of the exploitative tendency of the capitalism. Sir Robert Owen initiated a number of experiments for making co-operatives as an instrument of equitable economic order. Rochdale Pioneers also conceptualized the ethos and philosophy of cooperation and business rules. Over a period of time after the co-operatives were created, a need for some law was felt to regulate the working of these co-operatives. Thus, in Europe, the co-operative law was the creation of the co-operatives. Contrary to this, in most of the developing countries, the co-operatives were the creation of the co-operative law. This distinction is important to note to understand the relative concept of governance of co-operatives in Europe and other developing countries.
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Since the co-operatives in most of the Asian and African countries were established and promoted by the government as an agent of community development, the governments became active partners in the management and governance of co-operatives. In turn it also led to dependence on government syndrome. Role of the Registrar of Co-operative Societies (RCS) is of paramount importance in the governance of the co-operatives (Bhoria. K.S, 2002). The two main logics often advanced for the excessive government involvement in the working of the co-operatives are one, a lot of government money is involved in the co-operatives and, two, and the interests of the poor members and general public have to be safeguarded. In the Ethiopian context, the existing co-operative legislation and the government policy require a review for making it more member oriented, member driven, member friendly and business oriented. It is the governance of the entire co-operative sector, which should matter. The system of governance in the co-operatives including the size and composition of the board of directors need to be driven by the purpose and objective of the business. The right board of directors is the one that can best help to deliver the benefits to the members, which are at the root of the organization.
The availability of support services and the efficient mechanism of settlement of disputes of the co-operatives would also be essential for proper governance and functioning of the co-operatives. Good governance emerges through honest application of prevailing laws and respecting the spirit behind these laws. The overall system for the direction and management of the organization, encompassing all aspects of process from the members meetings to formulation and execution of the business policy constitutes the internal governance of co-operatives. The government and co-operatives both are concerned with the welfare and well being of the people (Karthikeyan,2008). They are not rivals to each other. They are partners in the process of social and economic development. The government has to undertake a number of initiatives and the measures to provide and secure right kind of governance to the co-operatives like, National Policy on Co-operatives, Task Force Co-operative Proclamation, towards self-regulation, etc.
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Co-operative Governance – Definition
Co-operative Governance is a pure democratic self-governance system of managing a co-operative entity based on and in complying with the principles, values and philosophy of cooperation through the appropriate and effective organizational structure with conducive culture and ethical climate, organizational machinery that includes management and administrative professionals at various levels / layers of functioning within the parameters of legal of provisions and policy framework of the government, keeping in view the prevailing socio-economic environment to change the administrative culture, management and control systems, and the mind-set and work culture of the members and work force of Co-operative enterprises.
The Author
The management of co-operatives has to be entrusted to the people who own and use the services of the society. The system of governance must reflect and reinforce cooperation(DavidGriffiths,2003,accessedfrom:http://www.australia.coop/why_fail). The autonomy of the society needs to be maintained. Bureaucratic control of co-operatives manifests itself (i) when co-operatives are initiated by the government and not by the members themselves, (ii) when government implements economic and social development programmes through co-operatives, (iii) when government taking up the role of watch-dog restrict the powers of the co-operatives through nomination of board, supersession of board etc. But the ultimate control must remain in the hands of the members and the system of governance should ensure that it does.
Co-operative Governance Structure Co-operatives are basically democratic institutions and for their genuine working, it is essential that all the democratic principles and process are followed in letter and spirit. It has to be ensured that the election of the board, its office bearers, meetings of the board and general body are held regularly and timely. This helps in better answerability and participatory management. The co-operative governance structure includes all the role players viz., government, sponsored organizations, federations and the internal governance system(DamanPrakash,2004).
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Co-operative Governance Structure
Co-operative enterprise
Co-operative Governance Framework
As a matter of fact, the purpose and objectives of co-operative provide the framework for co-operative governance. Co-operatives are organized groups of people, jointly managed and democratically controlled enterprises. They exist to serve their members and to produce benefits for them. The member therefore is the focus and the governance should be member oriented. It should therefore, aim at ensuring performance and promotion of members’ interest by connecting the members, their elected representatives, management and employees, strategies and decision-making processes. Good co-operative governance is greater owner involvement in direction and control. It implies self-regulation, self-reliance, sustainability and self-discipline. The co-operative governance should essentially be based on the values and principles of cooperation as enunciated by the ICA. Therefore, any framework for co-operative governance should take into consideration these values and principles. These values and principles lay down the philosophy and concept of co-operatives and provide the overall governance framework for the working of co-operatives.
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To put more precisely and simply, governance means the way those with power use that power. The concept, therefore, has political and economic dimensions. The instrumental nature of governance implies that the four governance pillars are universally acceptable and applicable regardless of the economic orientation, strategic priorities, or policy choice of the government in question. The co-operative governance framework encompasses the four pillars as key components of governance viz., accountability, transparency, predictability and participation (DamanPrakash,2004).
Accountability is the capacity to call officials and members of co-operatives to account for their actions. Effective accountability has two elements viz., answerability and consequences without which accountability is only a time-consuming formality. In addition, both internal and external accountability are needed.
Transparency entails low-cost access to relevant information. Reliable and timely economic and financial information is a must for the public. It is essential not only that information be provided, but also that it be relevant and understandable. Both the public and members and other external authorities should be known the economic and financial information.
Predictability results primarily from laws and regulations that are clear, known in advance and uniformly and effectively enforced. Predictability of government economic actions is also needed as an indicator on which the co-operative sector and other sectors can rely to make its own production, marketing and investment decisions.
Co-operative Governance Framework
Co-operative Governance
Participation
TransparencyPredictability
Accountability Answerability
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Participation is needed to obtain reliable information and to serve as a reality check and watchdog for government action. Members’ participation in all respects and aspects of the helm of affairs of the co-operatives is needed and emphasized for good governance in co-operatives.
The well-known agency problems resulting from the separation of ownership from control (Berle&Means,1932;Jensen&Meckling,1976) still prevail in firms worldwide. Recent research (Coreetal.,1999) suggests that firms with weaker governance structure have greater agency problems; that firms with greater agency problems allow managers to extract greater private benefits; and that firms with greater agency problems perform worse. Specifically in Asia, it has been shown that both before(Joh,2003)and after(Mitton,2002)the Asian financial crisis in1997, firms that paid heed to good corporate governance practices fared better and provided greater protection to shareholders, especially the minority shareholders.
The literature on corporate governance examines the efficacy of alternative structures of ownership and the boards of directors and various other governance structures. While there is increasing evidence of the failure of certain governance structures to control and motivate managers to increase firm performance, the empirical evidence to date is mixed and gives little coherent evidence for the shape of an optimal governance structure. One explanation is that existing theories have not been sufficiently complete to include all major determinants of good corporate governance. Perhaps there will never be one optimal governance structure because no two firms, two markets, two legal regimes or two cultures are exactly the same, resulting in highly complex issue of corporate governance. Ultimately governance structure is determined by a combination of the above factors and their dynamics. A more likely and useful outcome of the on-going debate and research, perhaps, might be the increasing focus on shareholder interest and concerns, and identification of some widely accepted guiding principles, rather than trying to find some specific mechanisms which are universally applicable, for effective corporate governance.
Research studies on co-operative governance are little and the present study is a unique attempt in Ethiopian context. The SACCOs are flourishing like anything and these financial co-operatives should think of good governance practices. The study attempts to analyze the indicators of good governance practice in selected self-employed women SACCOs union located at Addis Ababa.
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OBJECTIVES OF THE STUDY
The study objectives are:
• To examine the existing governance practices of the sample SACCO union;
• To identify and analyze the indicators of good governance through Governance Report card; and
• To recommend a design of good governance framework for the SACCO union.
METHOD
The study was undertaken in Addis Ababa city of Ethiopia. Survey method was adopted. The major focus was different stakeholders of the union and member co-operatives. Two stage sampling procedure was employed for the study. The first stage was, as for study units, the Self Employed Women SACCO Union, located in Addis Ababa, and all its member co-operatives (20) were the sample for the study. At the second stage, different stakeholders – members, board members, representative of member co-operatives, paid management were selected. Except members of the SACCO union, other stakeholders were selected on census basis i.e., all board members (7); one representative from each member co-operative (20); and all paid management staff (17) were selected. As for members, two members from each member co-operative were selected as representatives and FGDs were conducted on certain governance issues. Semi-Structured Interview Schedule was administered among sample stakeholders. FGDs were conducted among members of the SACCO union to explore information on governance issues. Apart from these, Good Governance Issues Report Card was used to elicit more information on governance practice of the Union for grading governance indicators. The collected data from management committee members, representatives of member co-operatives and employees were processed and results were tabulated using simple percentage. Since the sample size is very small sophisticated statistical tools were not used. From among members 4 FDGs were conducted on certain governance issues and Good Governance Issues Report Card also administered to grade the governance indicators. The detail regarding governance issues report card is dovetailed in analysis part of this research paper.
MAJOR FINDINGS
Profile of Union
The Self-Employed Women’s Savings and Credit Co-operatives Union Ltd is established in June 2005 by 12 primary co-operatives. The vision statement of the
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union is: To see strong co-operative movement in Ethiopia emerging as a major instrument for achieving gender equality and poverty alleviation. The mission
statement is: To improve the living condition and ensure sustainable development of self-employed women through provision of full-fledged support to the women’s co-operatives, transform co-operatives into strong financial institutions and strengthen the co-operative movement by working together with local, national, regional and international institutions.
The union has the objectives: To improve the performance of the member co-operatives by providing financial and non-financial services; to ensure sustainable development when the supporting NGOs phase out; to enhance the society’s ability in rendering adequate service to their members; to find solutions collectively for problems that member co-operatives cannot solve; to make sure that co-operatives are governed by the spirit of co-operative regulation; to enhance the co-operative movement in Ethiopia; and to mobilize members capital for mutual benefits.
Currently, the union has 20 co-operative members with 6,002 individual members. The total number shares held by member co-operatives are 137 worth of ETB. 137000. The union is rendering services like, savings and credit to members, provision of loans like housing, school and group loans, administration of market shelters, organizing trade fairs, exhibition, bazaars, insurance service on loans, and administrating income generation ventures. Consecutive and timely education and training on co-operative principles, values, accounting, etc are also services rendered by the union.
Currently 7 members co-operatives and 59 individual borrowers got gross loan of ETB.102130; collection made by the union is ETB.110826.72.; the outstanding portfolio is ETB. 981303.28 and the repayment rate is 98.0 percent. The cumulative profit is ETB. 87840.52. Total assets position is ETB. 1820000, net saving ETB 65450 and the revolving fund ETB. 994000.
Governance Practices in the Union
Governance Structure of the Union
The General Assembly - The General Assembly comprises all members of the Union. According to the issues, the Assembly convenes regular meetings or special sessions. Attendance at regular meetings (usually 85 - 90 percent) is generally high when members have been informed in time, or when meetings are called to discuss amounts to be purchased or to divide up the year’s profits. The personal reasons like
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home activities, small business of the members are the most common reasons for absences at these meetings. The management committee members usually approach the members at their home and enquire about the reasons for not attending the meetings, and insisting them to attend the meetings regularly without fail.
There are seven management committee members; there is a control committee also. Apart from these committees, there is an advisory board, which plays a key role in conflict mediation. As respected members of the union, this group provides a type of moral energy and helps to build the group’s cohesion and ensure that each member respects their responsibilities.
The union has a general manager to manage the daily routine affairs of the union. The general manager is delegated to undertake regular business activities and he is responsible for planning, implementation of the activities in consultation with and approval of the board. There is a secretary and four major wings as departments: finance and administration, co-operative support (to support member coops), business development and loan committee.
Decision-making in the union follows democracy and consensus decision-making. The process is democratic and consensual, but must be accompanied and monitored to conform to more formal governance processes in order to assure transparency and a written record. The union has workable mechanisms such as written minutes; payment of membership fees, bookkeeping and accounting reports of meetings and travel. This type of balance and transparency allows the union to confront more successfully common organizational difficulties and to practice good governance.
As for governance of this union, the member representatives from primary co-operatives, board of management, members and employees have adequate knowledge about co-operatives and co-operative management. They adhere to the co-operative principles and values. They are practicing the four pillars of co-operative governance. The results out of the survey conducted among management committee members, representatives of member co-operatives and employees (manager and other paid employees) are discussed hereunder.
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Concern about the Co-operative principles and values – Co-operative principles and Values are the basic guidelines to be followed by co-operatives. The following Table depicts a clear picture on how the stakeholders concern about co-operative principles and values and practice the same.
Table 1: Level of Concern about practice of Co-operative Principles and Values
Level of Concern
Respondent Category
Number and Percentage of Respondents
Total
High Moderate Low
Management Committee Members
6 (85.71) 1 (14.29) 0 7 (100.0)
Representative of Member Coops
17 (85.0) 2 (10.0) 1 (05.0) 20 (100.0)
Employees 9 (52.94) 4 (21.53) 4 (21.53) 17 (100.0)
Figuresinbracketsarepercentagestorowtotal
As for the level of concern about the practice of co-operative principles and value, the majority (85.71%) of management committee members and 85.0 percent of representatives of member primary co-operatives have high level of concern, and only 52.94 percent of employees have high level of concern about the practice of co-operative principles and values. The reason could be that the employees they concentrate on their work rather than practicing co-operative principles and values. The women SACCO union is being practicing co-operative principles and values for good governance system.
Concern about the Co-operative Governance Pillars – The co-operative governance pillars have to be adhered/adopted for having good governance system in co-operatives. The following Table shows the results out of the survey among management committee members, representatives of member co-operatives, and employees on the concern about the practice of pillars of co-operative governance.
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Table 2: Level of Concern about practice of Pillars of Co-operative Governance
Level of Concern
Respondent Category
Number and Percentage of Respondents
Total
High Moderate Low
Management Committee Members
Participation 7 (100.0) 0 0 7 (100)Transparency 6 (85.71) 1 (14.29) 0 7 (100)Predictability 5 (71.44 1 (14.28) 1 (14.28) 7 (100)Accountability 6 (85.71) 1 (14.29) 0 7 (100)Representative of Member Coops
Participation 16 (80.0) 2 (10.0) 2 (10.0) 20 (100)Transparency 14 (70.0) 2 (10.0) 4 (20.0) 20 (100)Predictability 14 (70.0) 2 (10.0) 4 (20.0) 20 (100)Accountability 15 (75.0) 1 (05.0) 4 (20.0) 20 (100)Employees
Participation 12 (70.59) 3 (17.65) 2 (11.76) 17 (100.0)Transparency 8 (47.06) 5 (29.41) 4 (21.53) 17 (100.0)Predictability 8 (47.06) 3 (17.65) 6 (35.29) 17 (100.0)Accountability 10 (58.82) 4 (21.53) 3 (17.65) 17 (100.0)
Figuresinbracketsarepercentagestorowtotal
The survey revealed that the level of concern about the practice of pillars of co-operative governance among management committee members higher than that of representatives of member co-operatives. As for level of concern about the practice of participation, it is revealed that cent percent of the management committee members have high concern; because they believe in participation leads to success and good governance. As for transparency and accountability, except one management committee member all others have high concern; predictability only 5 (71.44%) out of 7 members has high concern. Among representatives of member co-operatives, 80 percent have high concern about the practice of participation as a pillar of governance; transparency and predictability 70 percent; and accountability 75 percent as high concern. The employees have moderate and low level of concern about transparency, predictability and accountability; but somewhat high concern about the practice of participation as a pillar of governance. The general manager
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as an employee has high concern about the practice of all pillars of governance whereas all other employees (secretarial and sub staff) have moderate and low level of concern except a few with the concern about participation.
At the outset, this women SACCOs union is adhering to co-operative principles and values; has more concern about the practice of pillars of co-operative governance.
Co-operative Good Governance Indicators
Good governance is good government. The co-operative governance concept relates to the quality of the relationship between the government and the citizens ie., the co-operative system and its members for whom it exists to serve, promote and protect. The indicators for good governance in co-operatives compiled with corporate culture and ethical climate in co-operatives would be: the awareness of the leaders and members about the principles, philosophy and the basic values of cooperation; the difference between co-operatives and other kinds of organizations; the consciousness of the board members about their duties and responsibilities; the extent of delegation of powers to the chief executives; the smoothness of the communication channels between the chief executive and the board, between the chief executive and members, and members and board; the accountability of the elected representative and professional managers; the accountability and answerability of members; the level of transparency in the decision making process; participation of members in all respects of the helm of affairs of the co-operatives; the aim of attaining the objectives of the co-operative enterprise; and the relationship with the external environmental factors which influence the operations of the organization.
Governance Issues Report Card
The Governance Issues Report Card was administered among the members (both individual member of the union and selected members from primary member co-operatives) of the women SACCOs union regarding certain issues related to co-operative good governance. This good governance report card is the simplest and best way to participate and improve the governance system of co-operatives. This good governance issues report card can be administered among any type of stakeholder in co-operatives. During FGD among members, this card was used to elicit more information about the good governance indicators in women SACCOs union. Based on the issues on governance of women SACCOs union the results were explored from among members and given in Table 3.
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The scales used were grade 1 to grade 5. First grade is very good (85% - 100%); second grade is good (65% - 84%); third grade is fair (50% - 64%); fourth grade is poor (35% - 49%); and fifth grade is very poor (below 35%). Almost all the issues related to co-operative good governance as good governance indicators were chosen to administer the governance issues report card shown / listed out in the table. Under each governance indicator four issues were addressed and scores were given. The percentage was arrived by using the simple formula: Percentage = Total score / 20 X 100. After arriving at the percentage for each indicator of good governance, the overall grade for good governance was prepared and given in the Table.
Table 3: Overall Grade for Good Governance in Women SACCO Union
S.No Good Governance Indicator Grade (1-5) %
1 Awareness of Leaders 2 812 Coop Principles & Values 1 883 Coop Proclamation 2 764 Participation (meeting / business) 1 905 Board Duty / Responsibility 2 836 Delegation to Manager 1 857 Transparency / Communication 1 898 Relationship (at all levels) 1 909 Decision Making 2 8110 Consensus Orientation 1 8611 Accountability 2 8212 Planning, Implementation and Control 2 8413 Strategic Vision 2 8014 Social Responsibility 3 6315 Elections / Voting (Democracy) 2 8316 Committees 2 7917 Risk Management 2 8018 Financial Stability / Profitability 2 8119 Recovery Rate 1 9820 Auditing 1 9521 Overall Governance 2 83
Source: Compiled from Survey
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The governance indicators such as, co-operative principles and values, delegation of power and authority to general manager, transparency, participation in meetings and business, relationship at all levels, recovery rate, consensus orientation, and auditing of accounts of the women SACCOs union have scored first grade (very good) while governance indicators like, awareness of leaders, co-operative proclamation, board duty and responsibility, decision making, accountability, planning, implementation and control, strategic vision, elections and voting, committees, risk management, and financial stability and profitability have scored second grade (good). The governance indicator social responsibility is given third grade (fair) because of moderate concern about social responsibility. The concentration on business may be the reason for this grade given by the members. The overall governance as an indicator of good governance has scored second grade (good).
By seeing the results out of Good Governance Issues Report card, it is indicated that the overall governance of the women SACCOs union is “good” and it is suggested that the union should work for getting the grade very good in co-operative governance.
During FGDs among members, they reported:
We participate in all affairs of our co-operatives at the maximum possible manner, if any absence in the meeting, the committee members along with the general manager used to come to members’ (absentees) house and enquire the reasons. Though we have appreciated the governance system of the union, some of the indicators like accountability, risk management, social responsibility, and decision-making need to be concentrated to increase the grade of such governance indicators. Otherwise the overall governance system is good in our co-operatives and union.
Design for Good Co-operative Governance in the Union
The union has adopted a mixed governance model i.e., traditional, policy governance, corporate, constitutional representational of models focus on structure and functions; representational theory (democratic model), stewardship theory (partnership model) of focus on motive and behaviour; and blend of both guideline based and principle based governance models. The general manager is delegated to perform the union’s activities. He is doing everything on behalf of the board by following stewardship theory (partnership model) based governance. He is committed and sincere in his duties and responsibilities. The employees are also supporting him in all tasks of the
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co-operative union. The union has committees for various purposes and they follow the traditional governance model, but sometimes they follow policy governance model where the committees are not given due weight. The primaries (20 coops) are members and their representatives are with board and various committees and in this context, the union adopts constitutional representational governance model. Democratic model of governance is adopted in terms of meetings, decision-making process, elections, etc. Moreover, the union follows more prescriptive and less prescriptive based on the situations and the context of doing business.
Observing this, the Women SACCOs Union may go for redesign its governance system thereby it can be more successful. The appropriate governance model can be evolved and designed to suit all situations and based on their business activities. The committees can be given powers and the general manager can be delegated with the same functions, and democracy must be maintained as such. They can blend and merge traditional, stewardship and democratic models and come up with a redesigned model for more success of the Women SACCOs union.
However, the women SACCOs union is an example of good governance model/framework. Successful and sound business activities, participation of stakeholders, transparent financial management and co-operative governance influence the success of this Union. It can be a model women co-operatives union, which practice good governance for creating a better standard for other co-operatives in the country.
REFERENCESBerle, A.A. & Means, G.C. (1932). The Modern Corporation and Private Property, Macmillan,
New York.
Bhagwati Prasad. (2003). “Some Dimensions of Co-operative Governance”, The Cooperator, 41(3), NCUI, New Delhi.
Bhoria. K.S. (2002). “Co-operative Governance with particular reference to India”, The Cooperator, 40(6), NCUI, New Delhi.
Brian T. Oleson & Anders Bruun. (2001). “Governance and Co-operatives: The Search for a Model”, Conference paper - Mapping Co-operative Studies in the New Milennium, BC Institute for Co-operative Studies, Canada.
Chellappan, K. (1998). “Towards Image building by Co-operatives in the changing environment”, Khadi Gramodyog, 44(7), KVIC, Mumbai.
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Core, J.E., Holthausen, R.W. & Larcker, D.F. (1999). ‘Corporate governance, chief executive officer compensation, and firm performance’, Journal of Financial Economics, vol. 51(3): 371-406.
Daman Prakash. (2004). “Professionalization: Key for Good Governance in Co-operatives”, The Cooperator, 42(1), NCUI, New Delhi.
ICA. (1984). “Manpower Management and Co-operative Development”, Report of Regional Seminar, Kuala Lumpur, Malaysia (27th March – 9th April 1983), ICA-ROEC, New Delhi.
IFF Research (2004). A survey of Corporate Governance in Life Mutuals, Research Report for the Myners review of the governance of life Mutuals, HM Treasury, (UK).
Jensen, M.C. & Meckling, W.H. (1976). ‘Theory of the Firm: Managerial Behavior, Agency Costs, and Ownership Structure’, Journal of Financial Economics, vol. 3: 305-350.
Joh W.S. (2003). ‘Corporate governance and firm profitability: evidence from Korea before the economic crisis’, Journal of Financial Economics, vol. 68(2): 287-322.
Karthikeyan M. (2008). “Co-operative Governance – Training Manual”, England Africa Partnership Project (British Council, UK), Ambo University, Ambo, Ethiopia.
Mitton T. (2002). ‘A cross-firm analysis of the impact of corporate governance on the East Asian financial crisis’, Journal of Financial Economics, vol. 64(2): 215-241.
Murray Fulton. (1996). “A Discussion Paper on Canadian Wheat Board Governance”, Centre for the Study of Co-operatives, UK.
Raija Itkonen. (1996). “My Views on Co-operative Corporate Governance”, Review of International Co-operation, 89(4): 20-24.
Steinar Sivertsen.(1996). “Governance Issues Seen from a Management Perspective”, Review of International Co-operation, 89(4): 34-36. Accessed from: http://www.wisc.edu/uwcc/icic/orgs/ica/pubs/review/ICA-Review-Vol-89-No-4-199961/Governance-Issues-Seen-From-a-Management1.html.
Websites: http://www.ica.coop/ica/issues/governance.html
http://www.australia.coop/cg_pub.htm
http://www.australia.coop/why_fail
www.co-operativegrocer.coop
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AUTHORS’ BACKGROUND
Dr. M. Karthikeyan is a lecturer at the Department of Co-operatives, Faculty of Business and Economics, Hawassa University, Ethiopia. He has been in the field of teaching and research for more than 15 years. He has published 19 books and more than 35 papers at the regional, national and international journals. He has participated and presented papers in the conferences, seminars and workshops at state, regional, national and international levels. M. Karthikeyan has associated in many major and minor research projects funded by national and international agencies such as England Africa Partnership Project, ILO-CoopAfrica Health Co-operative Feasibility Project (Core Committee member), and Kenya Training Needs Assessment Peer-Partnered Project (Ethiopia-Kenya) initiated by Lorna Young Foundation, UK. He initiated and succeeded in entering into MoU between Department of Co-operatives, Institute of Co-operatives & Development Studies, Ambo University and Euricse, Trento, Italy.
CABARAN KOPERASI PENGGUNA DALAM AKTIVITI PERUNCITAN DI SEMENANJUNG MALAYSIA
Norazlan Hasbullah, Noranita Mohd Nor, Mohd Faisal Shariff, Ju Samsuddin Safian & Arfizawati Abd Hadi
MaktabKoperasiMalaysia(Co-operativeCollegeofMalaysia)
ABSTRACT
Thisresearchstudies thechallengesfacedbytheConsumerCo-operatives inretailactivities inPeninsularMalaysia.Questionnairesweredistributedusingthesimplerandomsampling toobtain theperceptionofrespondents fromco-operatives.154respondentswereanalyzedusingdescriptiveanalysis.TheresultofthestudyshowsthatfivekeychallengesfacedbyAdultConsumersCo-operativeinPeninsularMalaysiaare(1)Competitionfromtheprivatesector,(2)Lacktheknowledgeandskillsoftheboardmemberintheretailsector(3)Thesizeofco-operativestoreissmall;(4)Mostofthecreditfacilitiesprovidedbythesupplierisinashortperiod,and(5)Difficultyinobtainingco-operativestoreemployees,qualifiedandskilled.
ABSTRAK
KajianinimemperlihatkancabaranyangdihadapiolehKoperasiPenggunadalammenjalankanaktivitiperuncitandiSemenanjungMalaysia.Soalselidiktelahdiedarkanmenggunakankaedahpersampelanrawakdansebanyak154respondentelahdianalisismenggunakankaedahanalisisdiskriptif.KajianmenunjukkanlimacabaranutamayangdihadapiolehKoperasiPenggunaDewasadiSemenanjungMalaysiaadalah;(1)Persaingandarisektorswastayangmenjalankanperniagaanperuncitan;(2)AhliLembagaKoperasi(ALK)kurangpengetahuandankemahirandalambidangperuncitan;(3)Saizkedaikoperasiyangkecil;(4)Kebanyakankemudahankredityangdiberikanolehpembekaladalahdalamtempohyangpendek;dan(5)Kesukaranmendapatkankakitangan kedai koperasi yang berkelayakan dan berkemahiran.
PENGENALAN
Koperasi Pengguna boleh ditakrifkan sebagai koperasi yang menjalankan aktiviti kepenggunaan seperti pasar mini, pasaraya, kedai runcit, stesen minyak, kedai alatan rumah dan lain-lain (SKM, 2009). Koperasi Pengguna memainkan peranan yang penting dalam menyediakan barang-barang keperluan harian dan perkhidmatan
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kepada anggota dan bukan anggota pada harga yang berpatutan. Peruncitan merujuk kepada semua aktiviti yang berkaitan secara langsung dengan jualan barangan atau perkhidmatan dalam kuantiti yang kecil untuk memperoleh keuntungan, menjual barang-barang keperluan pengguna kepada pengguna akhir dan bukannya kepada pengguna perniagaan (Mohd Said, 1990). Perdagangan runcit merujuk kepada ‘penjualan semula (tanpa pengubahsuaian) barangan baru dan terpakai kepada pengguna akhir untuk kegunaan isi rumah atau persendirian’. Ini termasuk jualan yang dilakukan oleh kedai, stor aneka jabatan, gerai, Koperasi Pengguna dan sebagainya (Perangkaan Ekonomi Malaysia 2007). Perniagaan runcit melibatkan jualan pelbagai barang-barang dan perkhidmatan daripada barangan keperluan rumah tangga hingga kepada makanan dan aksesori, Guy (1980) telah mengkategorikan aktiviti peruncitan kepada tiga kumpulan iaitu; i) Barang-barang mudah beli seperti barang runcit dan barang keperluan harian, ii) Barang beli belah di mana harganya lebih mahal dan jarang dibeli, iii) Barang istimewa di mana barang tersebut memiliki ciri-ciri unik dan menjadi pilihan kepada pelanggan yang berpendapatan tinggi. Peruncitan wujud dalam skala yang kecil dan skala yang besar (Ahmad et al., 1996; Nik Yacob et al., 1992; Cox, 1988). Perniagaan runcit dalam skala yang kecil merujuk kepada peruncit yang memiliki kedai atau tanpa kedai seperti penjaja dan gerai. Peruncit besar-besaran merujuk kepada superstore, discount store, department store, supermarket, hypermarket dan pusat membeli belah.
Pernyataan Masalah
Perkembangan koperasi di Malaysia telah mencecah usia 85 tahun. Namun ia masih belum mencapai kejayaan yang boleh dibanggakan sepertimana gerakan koperasi di negara-negara maju di dunia seperti United Kingdom, Jepun, Korea Selatan, Eropah, Belanda, Switzerland dan New Zealand (Khalid, 2008). Gerakan koperasi di Malaysia hanya menyumbangkan sebanyak 1 peratus bagi Keluaran Dalam Negara Kasar (Arkib Utusan Malaysia Online 14 Julai 2010). Ini berbeza dengan gerakan koperasi di beberapa buah negara di dunia yang menunjukkan gerakan koperasi memberikan sumbangan yang besar dalam sektor ekonomi seperti negara Portugal menyumbangkan sebanyak 5 peratus KDNK, Iran sebanyak 6 peratus, Vietnam 8.6 peratus, Kenya sebanyak 45 peratus, dan New Zealand sebanyak 22 peratus (ICA, 2005). Mengikut laporan SKM (2009), kebanyakan saiz kedai koperasi di Malaysia adalah berskala kecil dan sederhana dan ditambah pula dengan kuasa beli koperasi juga agak rendah, maka koperasi tidak mendapat faedah daripada diskaun harga atas belian pukal. Menurut sumber dari SKM lagi, sebanyak 184 Koperasi Pengguna telah dibatalkan pendaftarannya dari tahun 2000-2008. Berlandaskan perangkaan tersebut, perbandingan sumbangan Koperasi Pengguna terhadap gerakan koperasi keseluruhannya telah dianalisis.
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Secara keseluruhannya, sumbangan Koperasi Pengguna dewasa dari segi bilangan anggota, modal syer, aset dan keuntungan masih lagi rendah jika dibandingkan dengan bilangan Koperasi Pengguna yang ada iaitu melebihi 30 peratus daripada jumlah populasi koperasi dewasa. Oleh itu kajian ini akan mengenal pasti cabaran-cabaran yang dihadapi oleh koperasi pengguna yang mana menyebabkan status koperasi pengguna kini masih belum berada pada tahap yang membanggakan.
Objektif
Kajian ini bertujuan untuk mengenalpasti cabaran-cabaran yang dihadapi oleh Koperasi Pengguna Dewasa dalam aktiviti peruncitan di Semenanjung Malaysia.
SOROTAN KAJIAN
Status Koperasi Pengguna di Malaysia
Koperasi Pengguna pertama di Malaysia yang didaftarkan adalah ‘Ulu Langat Malay Co-operative Shop Society’ iaitu pada tahun 1936 dan telah bertambah kepada dua buah Koperasi Pengguna pada tahun 1940. Dari tahun 1941 hingga 1950, Koperasi Pengguna tidak menunjukkan sebarang perkembangan disebabkan faktor politik yang kurang stabil. Di awal 1960an, sebanyak 44 buah Koperasi Pengguna telah ditutup akibat penamatan pemberian bantuan kemudahan bekalan barangan oleh kerajaan. Faktor penutupan ini turut didorong oleh kegagalan koperasi untuk mengutip hutang tertunggak. Berikutan kejayaan penubuhan MCSS pada Jun 1973, banyak Koperasi Pengguna telah mengambil peluang untuk menubuhkan premis berkonsepkan pasar mini seperti Shamelin, Koperasi Polis, Koperasi Tentera, FELDA, FELCRA, RISDA, jabatan-jabatan kerajaan dan swasta serta KOMART. Pada tahun 1996, bilangan koperasi yang terlibat dengan aktiviti pasar raya, pasar mini dan kedai telah meningkat sebanyak 1,852 buah koperasi dengan bilangan anggota seramai 1.9 juta orang. Jumlah jualan yang telah dicapai pada tahun tersebut ialah sebanyak RM526.7 juta dan memperolehi keuntungan sebanyak RM132.4 juta.
Sehingga tahun 2008, didapati bahawa bilangan Koperasi Pengguna dewasa mewakili sebanyak 31.6 peratus daripada jumlah keseluruhan koperasi yang berdaftar tetapi jumlah keanggotaannya hanya mencatatkan sebanyak 14.6 peratus dari jumlah keseluruhan keanggotaan koperasi dewasa. Modal syer dan aset yang berjaya dikumpulkan masing-masing hanya 2.8 peratus dan 1.7 peratus, serta keuntungan tahunan hanya pada 2.2 peratus sahaja berbanding dengan jumlah keseluruhan sumbangan koperasi dewasa. Perbandingan tersebut adalah seperti di Jadual 1.
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Jadual 1: Perbandingan Perangkaan Am Koperasi Dewasa dengan Koperasi Pengguna Dewasa sehingga 31 Disember 2008
Perkara Keseluruhan Koperasi Koperasi Pengguna DewasaJumlah Jumlah Peratus(%)
Bilangan Koperasi 4,051 Buah 1,283 Buah 31.6Bilangan Anggota 4,487,557 Orang 658,029 Orang 14.6Modal Syer RM 8,400,467,072 RM 237,702,053 2.8Aset RM 55,580,825,717 RM 988,115,272 1.7Turnover RM 7,589,041,394 RM 803,752,797 10.5Untung / Rugi RM 1,919,148,802 RM 42,954,235 2.2
(Sumber: Suruhanjaya Koperasi Malaysia, 2008)
Manakala statistik koperasi mengikut fungsi Pengguna dewasa, mencatatkan sebanyak 1,283 buah koperasi dan bilangan anggota sebanyak 658,029 orang, modal syer-yuran sebanyak RM237,702,053, jumlah aset sebanyak RM988,115,272 dan meraih jumlah keuntungan sebanyak RM42,954,235 (SKM, 2008). Perangkaan Am koperasi mengikut fungsi adalah seperti Jadual 2 di bawah:
Jadual 2: Perangkaan Am Koperasi Dewasa Mengikut Fungsi sehingga 31 Disember 2008
Bil Fungsi Bil. Kop.
Anggota Modal Syer (RM)
Aset (RM) Turnover (RM)
Untung/ Rugi
(RM)1 Perbankan 2 828,484 2,199,709,013 42,208,732,138 3,551,004,345 1,254,943,822
2 Kredit/
Kewangan551 1,962,834 3,969,003,533 7,620,467,830 1,747,350,390 353,658,419
3 Pertanian 842 248,526 239,016,392 964,366,413 520,805, 179 132,336,678
4 Perumahan 88 89,102 131,592,122 540,551,689 103,492, 753 38,860,369
5 Perindustrian 75 11,997 6,953,639 49,874,089 42,628,043 41,824
6 Pengguna Dewasa
1,283 658,029 237,702,053 988,115,272 803,752, 797 42,954,235
7 Pembinaan 108 62,111 15,248,402 57,049,368 23,366,543 417,739
8 Pengangkutan 336 116,918 47,338,371 182,006,579 391,607, 704 14,343,117
9 Perkhidmatan 756 509,556 1,553,903,547 2,969,662,339 405,033, 640 81,592,599
Jumlah 4,051 4,487,557 8,400,467,072 55,580,825,717 7,589,041,394 1,919,148,802
(Sumber: Suruhanjaya Koperasi Malaysia, 2008)
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Cabaran Koperasi Pengguna
Sejak di peringkat awal lagi, penubuhan Koperasi Pengguna menghadapi pelbagai cabaran dan masalah dalam menjalankan perniagaan. Mengikut perangkaan SKM sehingga tahun 2008 gerakan koperasi masih belum dapat menubuhkan sebuah pasar raya koperasi yang berjaya dan boleh membantu anggota mendapatkan bekalan yang murah, berkualiti dan berkhasiat.
Menurut SKM (2009), masalah atau cabaran yang dihadapi oleh Koperasi Pengguna di Malaysia ialah:
Cabaran dari Segi Kewangani. Kebanyakan saiz kedai koperasi di Malaysia berskala kecil dan sederhana serta
mempunyai kuasa beli agak rendah. Oleh demikian koperasi tidak mendapat faedah daripada diskaun harga atas belian pukal. Di Malaysia, kita dapat melihat koperasi seperti berada dalam satu prinsip tetapi sebenarnya mereka bergerak dan beroperasi dalam rumpun atau cluster yang berasingan. Pengasingan ini sebenarnya tidak memberikan keuntungan kepada gerakan koperasi, malah menjadi semakin lemah dan kian terhakis kekuatan ekonominya.
ii. Kurang modal pusingan. Selain daripada memperolehi jumlah kredit yang kecil daripada pembekal atau tiada langsung, sumbangan daripada anggota sedikit. Kebanyakannya bergantung kepada pinjaman luar.
iii. Kos overhed tinggi kerana menggajikan kakitangan.
Cabaran dari Segi Tadbir Urus i. Ketidakcekapan pengurusan seperti tadbir urus yang tidak sempurna malah ada
rekod-rekod perakaunan yang gagal diselia dan dikemaskini sebagaimana yang dikehendaki oleh Akta Koperasi.
ii. Pemberian pinjaman kredit tidak terkawal dan tidak ada sistem kutipan yang berkesan.
iii. Mengikut Raja Maimon(1999), Anggota Lembaga Koperasi (ALK) juga kurang faham tentang falsafah dan prinsip koperasi serta peranan mereka sebagai ALK. Mereka juga kurang kemahiran dalam pengurusan perniagaan. Oleh itu semua urusan perniagaan kedai dibebankan kepada pengurus tanpa garis panduan. Terdapat ALK yang jarang mengadakan mesyuarat.
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iv. Kebanyakan pengurus dan kakitangan koperasi yang dilantik tidak mempunyai kecekapan yang diperlukan untuk mengurus kedai serta kurang pengetahuan dari aspek kejurujualan dan perakaunan. Sebagai contoh, rekod-rekod perniagaan tidak disimpan dengan betul dan ini menyukarkan penyediaan penyata kewangan dan melewatkan mesyuarat agung. Selain itu, pengurus dan kakitangan koperasi tidak cekap membuat keputusan pengurusan seperti menetapkan harga jualan yang kompetitif, membuka cawangan baru dan membeli aset tetap tanpa mengambil kira faktor kualitatif dan kuantitatif yang ada pada koperasi.
Cabaran dari Segi Penglibatan Anggotai. Kurangnya pendidikan kepenggunaan dalam koperasi kepada anggotanya.
ii. Kurang komitmen anggota. Terdapat anggota yang telah diberi kemudahan kredit pengguna oleh koperasi tetapi gagal melunaskan hutang mereka sebagaimana yang dikehendaki. Keadaan ini menyebabkan koperasi berhadapan dengan krisis aliran tunai dan akhirnya operasi kedai terpaksa ditutup.
iii. Tiada semangat sayangkan koperasi. Anggota menyertai koperasi hanya untuk mendapatkan dividen dan pinjaman sahaja.
iv. Anggota dan bakal anggota kurang faham mengenai falsafah dan prinsip koperasi. Mereka tidak tahu akan hak dan tanggungjawab mereka sebagai pemilik dan anggota. Ini menyebabkan penglibatan mereka dalam aktiviti koperasi menjadi terhad; (Raja Maimon, 1999).
Cabaran dari Segi Pemasarani. Pelaksanaan hadiah langganan (rebat) menjadi semakin tidak popular di dalam
amalan kedai pengguna koperasi. Sedangkan amalan rebat ini semakin meningkat popular di kalangan sektor swasta. Amalan rebat menjadi tidak popular di kalangan koperasi kerana pendekatan yang diamalkan masih kekal konservatif sedangkan menggunakan amalan rebat melalui konsep yang diubahsuai semula.
ii. Barangan yang dijual oleh kedai koperasi seringkali gagal menawarkan harga yang kompetitif berbanding dengan pesaing. Keadaan ini menyebabkan koperasi kehilangan pelanggan yang berurusniaga secara tunai dan koperasi kehilangan pelanggan yang berkualiti.
iii. Kekurangan modal untuk program promosi yang dinamik menyebabkan maklumat pemasaran tidak sampai kepada anggotanya yang merupakan pelanggannya.
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Cabaran dari Segi Kerjasamai. Tidak melaksanakan prinsip kerjasama antara koperasi di mana koperasi yang
ada kerjasama boleh menawarkan faedah yang sama kepada mana-mana anggota kepada koperasi tersebut.
ii. Sukar mewujudkan gabungan Koperasi Pengguna kerana sejarah gabungan Koperasi Pengguna yang banyak menemui kegagalan.
Cabaran dari Segi Hubungan Pembekali. Kebergantungan kepada pembekal daripada pengusaha di pasaran bebas yang tidak
terjamin dari segi pembekalan dan harga barangan. Keadaan ini menyebabkan harga barangan di koperasi tidak dapat dijual dengan harga yang berpatutan.
ii. Saiz belian yang kecil menyebabkan koperasi bergantung kepada orang tengah/vendor. Ini menyebabkan kos belian tinggi dan harga barang yang dijual menjadi mahal.
iii. Kurang mendapat kemudahan kredit daripada pembekal, kerana tiada hubungan rapat dengan pembekal.
Cabaran dari Segi Produki. Rangkaian atau jenis barangan yang dijual terhad dan mutunya kurang
memuaskan.
ii. Teknik amalan perniagaan yang kurang berkesan. Misalnya, tiada mesin tunai (cash register), sistem perakaunan yang tidak sistematik, teknik pesanan dan penerimaan yang kurang berkesan, penyimpanan rekod stok yang tidak lengkap, imej kedai kurang memuaskan seperti berhabuk, terdapat barang/stok yang sudah lama dan rosak.
iii. Mengikut Raja Maimon (1999), kebanyakan Koperasi Pengguna tidak cekap dalam memenuhi objektif utamanya untuk menjual keperluan barangan pengguna pada harga yang berpatutan.
Cabaran dari Segi Persaingani Persaingan harga dengan pasaraya seperti Carrefour, Tesco, Mydin dan lain-lain
kedai pengguna yang dapat menawarkan harga dan barangan lebih kompetitif.
ii. Persaingan hebat daripada sektor swasta dan perniagaan keluarga.
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Cabaran dari Segi Motivasi PekerjaKebanyakan pengurus dan kakitangan tidak berpuashati dengan bebanan kerja yang ditanggung kerana tidak berbaloi jika dibandingkan dengan gaji yang diterima. Kakitangan juga kurang berminat untuk bekerja di kedai koperasi kerana faktor waktu bekerja yang panjang (biasanya jam 8.00 pagi hingga 9.00 malam). Koperasi tidak mampu membayar upah yang tinggi atau berpatutan, tiada inisiatif kenaikan pangkat dan jarang mendapat peluang untuk menghadiri kursus.
METODOLOGI LATIHAN
Kajian ini dilakukan ke atas Koperasi Pengguna Dewasa di Semenanjung Malaysia yang terlibat dalam aktiviti perniagaan kedai runcit, pasaraya/pasar mini dan kedai menjual barangan harian. Kajian ini mengenalpasti cabaran yang dihadapi oleh Koperasi Pengguna Dewasa di Semenanjung Malaysia. Soal selidik yang dibangunkan telah menyenaraikan 29 cabaran yang dihadapi oleh Koperasi Pengguna Dewasa dalam aktiviti peruncitan dan kaedah pensampelan secara rawak telah digunakan iaitu sebanyak 292 buah koperasi pengguna dewasa (tidak termasuk koperasi sekolah) telah menjadi responden dan bagi setiap sebuah koperasi hanya seorang responden dipilih di kalangan Pengerusi, Setiausaha, Bendahari atau Pengurus koperasi. Kesemua 29 cabaran ini diukur menggunakan kaedah skala dari (1) Sangat Tidak Setuju hingga (5) Sangat Setuju.
Bagi proses pengumpulan data, borang soal selidik telah dihantar ke semua negeri dengan meminta bantuan dari Suruhanjaya Koperasi Malaysia (SKM). Para penyelidik telah melantik Pegawai SKM wilayah sebagai pembanci untuk mengumpul data. Ini memudahkan proses pengumpulan data dengan pertolongan pegawai tempatan yang mahir dengan geografi tempatan di wilayah masing-masing. Tempoh masa yang diberikan untuk memulangkan borang soal selidik ini ialah selama tiga minggu dari tarikh surat dikeluarkan. Kumpulan penyelidik telah membuat tindakan susulan melalui telefon ke setiap SKM negeri untuk memastikan borang soal selidik telah lengkap diisi dan dihantar semula ke Maktab Kerjasama Malaysia (MKM). Sebanyak 292 borang soal selidik telah diterima dan hanya 154 borang sahaja digunakan untuk keseluruhan analisis kajian ini, iaitu menunjukkan peratusan sebanyak 52.7 peratus.
Data yang diperolehi telah di analisis menggunakan kaedah diskriptif analisis. Diskriptif analisis merupakan kaedah yang paling sesuai bagi mengenal pasti cabaran utama yang dihadapi oleh Koperasi Pengguna Dewasa dalam aktiviti peruncitan di Semenanjung Malaysia.
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ANALISIS
Taburan jawatan yang disandang di koperasi daripada 154 responden adalah 34 (22.1 peratus) terdiri daripada Pengerusi dan Bendahari, 51 (33.1 peratus) adalah Setiausaha dan 35 (22.7 peratus) Pengurus Koperasi. Kaedah diskriptif analisis telah digunakan dalam kajian ini bagi mengenal pasti cabaran utama yang dihadapi oleh Koperasi Pengguna Dewasa dalam aktiviti peruncitan di Semenanjung Malaysia. Kesemua 29 cabaran di analisis melalui kaedah diskriptif dengan menggunakan perisian SPSS. Nilai min yang tertinggi telah diambil bagi mengukur cabaran utama yang dihadapi oleh Koperasi Pengguna Dewasa dalam aktiviti peruncitan di Semenanjung Malaysia. Kebolehpercayaan analisis menggunakan Cronbach’s alpha merupakan darjah ketepatan yang diukur serta nilai Cronbach’s alpha 0.5 atau ke atas boleh diterima dalam sesuatu instrumen kajian (Kerlinger & Lee, 2000, cited in Mokhlis & Sparks, 2007). Nilai Cronbach’s alpha bagi kesemua instrumen cabaran yang dihadapi semasa menguruskan aktiviti peruncitan koperasi adalah 0.947. Ini bermakna kesemua cabaran yang di senaraikan boleh digunapakai dalam kajian ini.
Tahap persetujuan responden dalam 29 cabaran yang dihadapi semasa menguruskan aktiviti peruncitan koperasi telah diambil dalam kajian ini menggunakan 5-Point Skala Likert bermula daripada 1 (Sangat Tidak Setuju) hingga (5) Sangat Setuju. Bagi tujuan analisis ini, cabaran yang menunjukkan nilai min sekurang-kurangnya 3 di dalam Skala Likert bermaksud responden bersetuju dengan cabaran yang dihadapi oleh Koperasi Pengguna dalam menguruskan aktiviti peruncitan di Semenanjung Malaysia. Manakala, cabaran yang menunjukkan nilai min antara 1 hingga kurang daripada 3, bermaksud responden tidak bersetuju dengan cabaran yang dihadapi oleh Koperasi Pengguna dalam menguruskan aktiviti peruncitan di Semenanjung Malaysia. Jadual 3 menunjukkan nilai min kesemua 29 cabaran yang dihadapi oleh Koperasi Pengguna Dewasa di Semenanjung Malaysia dalam menguruskan aktiviti peruncitan. Daripada 29 cabaran yang disenaraikan hanya 26 cabaran sahaja yang mempunyai nilai min 3 dan ke atas.
Cabaran yang paling utama(1) dihadapi oleh koperasi ialah persaingan dari sektor swasta yang menjalankan perniagaan peruncitan dengan nilai min 3.95. Cabaran yang kedua (2) tertinggi menunjukkan min 3.71 iaitu ALK kurang pengetahuan dan kemahiran dalam bidang peruncitan sebagai salah satu cabaran yang dihadapi. Diikuti dengan cabaran ketiga (3) iaitu saiz kedai koperasi ini yang kecil dengan nilai min 3.56. Seterusnya, kedudukan cabaran yang keempat (4) menunjukkan min 3.52 bersetuju bahawa kebanyakan kemudahan kredit yang diberikan oleh pembekal adalah dalam tempoh yang pendek.
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Kedudukan cabaran yang kelima (5) adalah kesukaran mendapatkan kakitangan kedai koperasi yang berkelayakan dan berkemahiran dengan min 3.47. Cabaran yang keenam (6) dengan min bernilai 3.46 mengatakan kebanyakan pilihan barangan yang dijual di kedai koperasi adalah terhad. Manakala kekurangan modal pusingan di kedai koperasi merupakan cabaran yang ketujuh (7) dihadapi oleh koperasi dengan nilai min 3.42. Cabaran yang seterusnya adalah cabaran yang kelapan (8) iaitu kos keseluruhan pengendalian kedai koperasi yang tinggi (seperti kos operasi, kos tetap, kos berubah dan lain-lain) dan min sebanyak 3.36. Selain itu, kebanyakan harga belian stok kedai koperasi yang tinggi berada di kedudukan yang kesembilan (9) dengan min sebanyak 3.34. Cabaran yang kesepuluh (10) dihadapi oleh koperasi adalah kebanyakan pelanggan yang membeli di kedai koperasi adalah bukan anggota koperasi dengan min sebanyak 3.33. Manakala bagi cabaran pada tangga ke 11 sehingga 29 menunjukkan julat min dari 3.31 hingga 2.64 seperti di Jadual 3.
Jadual 3: Cabaran yang dihadapi Semasa Menguruskan Perniagaan Runcit Koperasi
Cabaran yang Dihadapi Min Kedudukan
Persaingan dari sektor swasta yang menjalankan perniagaan peruncitan
3.95 1
ALK kurang pengetahuan dan kemahiran dalam bidang peruncitan
3.71 2
Saiz kedai koperasi ini yang kecil 3.56 3Kebanyakan kemudahan kredit yang diberikan oleh pembekal adalah dalam tempoh yang pendek
3.52 4
Kesukaran mendapatkan kakitangan kedai koperasi yang berkelayakan dan berkemahiran
3.47 5
Kebanyakan pilihan barangan yang dijual di kedai koperasi adalah terhad
3.46 6
Kekurangan modal pusingan di kedai koperasi 3.42 7Kos keseluruhan pengendalian kedai koperasi yang tinggi (seperti kos operasi, kos tetap, kos berubah dan lain-lain)
3.36 8
Kebanyakan harga belian stok kedai koperasi yang tinggi 3.34 9Kebanyakan pelanggan yang membeli di kedai koperasi adalah bukan anggota koperasi ini
3.33 10
Kesukaran mengekalkan kesetiaan anggota koperasi ini untuk terus membeli di kedai koperasi
3.31 11
Jadual 3: bersambung
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Cabaran yang Dihadapi Min Kedudukan
Kesukaran mendapatkan sokongan daripada anggota koperasi ini untuk membeli di kedai koperasi
3.30 12
Peragaan dan susun atur barangan di kedai koperasi kurang menarik berbanding pesaing
3.27 13
Sistem ganjaran (gaji, bonus dan lain-lain) yang ditawarkan oleh kedai koperasi tidak kompetitif
3.26 14
Sistem urus niaga di kaunter kedai koperasi ini masih menggunakan kaedah tradisional(seperti catatan buku hutang)
3.24 15
Mendapatkan bantuan kewangan dari institusi kewangan/kerajaan
3.23 16
Dasar kerajaan dalam peruncitan telah menyebabkan peluang peniaga tempatan amat terhad
3.21 17
Koperasi sukar membuat kutipan hutang daripada pelanggan 3.17 18Stok barangan yang tidak mencukupi disebabkan oleh masalah kewangan
3.17 19
Stok barangan yang tidak mencukupi disebabkan oleh kelewatan penghantaran barangan oleh pembekal
3.15 20
Ada sesetengah barangan yang dijual di kedai koperasi ini tidak menepati kehendak pengguna
3.11 21
Terdapat pelanggan sukar menjelaskan hutang kepada kedai koperasi ini
3.10 22
Stok barangan yang tidak mencukupi disebabkan kurang pemantauan keluar masuk stok
3.10 23
Kakitangan kedai koperasi yang kerap berhenti 3.06 24Lokasi kedai koperasi ini yang tidak strategik 3.01 25Kurang kerjasama antara ALK dan kakitangan kedai koperasi dalam pengurusan kedai
3.01 26
Tiada halatuju dalam perniagaan peruncitan yang diceburi 2.99 27Rekod-rekod perakaunan tidak teratur dan sistematik 2.88 28Kebocoran yang tinggi di kedai koperasi ini (seperti kehilangan stok dan duit)
2.64 29
PERBINCANGAN
Hasil kajian ini menunjukkan terdapat 26 cabaran yang dihadapi oleh Koperasi Pengguna Dewasa di Semenanjung Malaysia dalam menguruskan aktiviti peruncitan.
Jadual 3: Sambungan
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Lima cabaran utama yang dihadapi ialah (1) Persaingan dari sektor swasta yang menjalankan perniagaan peruncitan; (2) Ahli Lembaga Koperasi (ALK) kurang pengetahuan dan kemahiran dalam bidang peruncitan; (3) Saiz kedai koperasi yang kecil; (4) Kebanyakan kemudahan kredit yang diberikan oleh pembekal adalah dalam tempoh yang pendek; dan (5) Kesukaran mendapatkan kakitangan kedai koperasi yang berkelayakan dan berkemahiran. Pada dasarnya, sejak kewujudan Koperasi Pengguna di Malaysia, perkembangan hanya terbatas kepada aktiviti peruncitan secara kecil kecilan dan bukan berskala besar. Konsep fizikal koperasi dan peragaan barang di kedai koperasi masih lagi tidak dapat menyaingi pesaing dari sektor swasta khususnya dalam aktiviti peruncitan. Sehubungan itu koperasi perlu melakukan transformasi dengan meningkatkan imej kedai koperasi, mempelbagaikan barang yang dijual serta menggunakan kreativiti dalam pemasaran.
Koperasi juga perlu menggunakan sistem operasi dan pengurusan yang sistematik agar pengurusan kedai dapat dijalankan dengan lebih efektif dan efisien. Sokongan anggota, kakitangan dan ALK adalah penting bagi memastikan gerakan koperasi pengguna terus releven. Tenaga kerja dan anggota juga perlu memberi komitmen sepenuhnya dan berusaha bersama-sama untuk memajukan koperasi. Elemen-elemen dan nilai-nilai yang positif seperti profesionalisme, berintegriti, bertanggungjawab perlu ada dan diamalkan oleh setiap pekerja, anggota dan juga ALK. Ianya merupakan faktor penting yang dapat memastikan koperasi mencapai objektif, misi dan visi yang telah ditetapkan.
Hasil maklumbalas dan cadangan yang dikemukakan oleh pihak pengurusan koperasi, terdapat beberapa agensi pelaksana dan juga gerakan Koperasi Pengguna sendiri terlibat dalam meningkatkan prestasi koperasi pengguna di masa-masa akan datang bagi memastikan Koperasi Pengguna terus relevan. Cadangan-cadangan yang diutarakan adalah seperti berikut:
Kementerian Perdagangan Dalam Negeri, Koperasi dan Kepenggunaan (KPDNKK)i. Memberi bantuan seperti subsidi, tender dan prasarana.
ii. Memberi keutamaan kepada koperasi bagi mengusahakan peluang perniagaan dan pelaburan berdaya maju.
iii. Memberi bantuan dalam menyediakan tapak bangunan kedai, gerai dan pejabat koperasi untuk menggerakkan aktiviti koperasi.
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Suruhanjaya Koperasi Malaysia (SKM)i. SKM mewujudkan One Stop Center di setiap daerah untuk pengumpulan produk
koperasi.
ii. Mempermudahkan dan memperbanyakkan bantuan geran dan subsidi. Gerakan Koperasii. Memohon Tabung Modal Pusingan dari pihak SKM bagi menyokong aktiviti
peruncitan di koperasi.
ii. Mempelbagaikan produk, perniagaan dan menambahkan aktiviti serta pelaburan koperasi.
iii. ALK hendaklah sentiasa mendapat bimbingan serta mengikuti beberapa kursus di agensi penyelia koperasi seperti MKM untuk menambah ilmu pengetahuan.
iv. Menghantar ALK, kakitangan koperasi dan anggota mengikuti kursus-kursus latihan yang berkaitan dengan peruncitan (pengurusan stok, sistem kewangan dan lain-lain yang berkaitan) dan kepenggunaan.
PENUTUP
Kajian ini bertujuan untuk mengenalpasti cabaran yang dihadapi oleh Koperasi Pengguna Dewasa dalam aktiviti peruncitan di Semenanjung Malaysia. Dapatan kajian telah menunjukkan bukti bahawa responden bersetuju dengan 26 cabaran yang dihadapi oleh Koperasi Pengguna dalam menguruskan aktiviti peruncitan di Semenanjung Malaysia. Kajian ini juga boleh membantu dalam memberikan gambaran sebenar terhadap keadaan terkini dan permasalahan yang dihadapi oleh Koperasi Pengguna dalam menjalankan aktiviti peruncitan kepada agensi pelaksana serta gerakan koperasi pengguna itu sendiri. Ia juga dapat membantu Koperasi Pengguna di masa akan datang dan seterusnya dalam merangka strategi yang lebih komprehensif untuk terus berdaya saing dan berdaya tahan. Cadangan yang diutarakan di dalam kajian ini melibatkan pelbagai usaha serta langkah proaktif yang boleh dilaksanakan oleh agensi-agensi berwajib bagi memantapkan pertumbuhan dan perkembangan gerakan koperasi pengguna.
Berdasarkan cabaran paling utama yang dihadapi oleh Koperasi Pengguna dalam menguruskan aktiviti peruncitan ialah persaingan dari sektor swasta yang menjalankan perniagaan peruncitan, maka dengan itu cadangan kajian yang akan datang dan boleh dijalankan adalah mengenalpasti kesan-kesan positif atau negatif di dalam persaingan
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Koperasi Pengguna dengan pasaraya besar atau hypermarket. Kajian juga boleh dijuruskan kepada mengenalpasti apakah permasalahan yang dihadapi oleh Koperasi Pengguna apabila terpaksa bersaing dengan premis perniagaan ini.
RUJUKANAhmad, Z. et al. (1996). Basic Retailing. Shah Alam:Institut Teknologi MARA.
Arkib Utusan Malaysia. Dasar Koperasi Negara. Dicapai pada Julai 14, 2010, daripada http://utusanmalaysia.com.my
Cox, R. (1988). Retail Management. London: Longman Group.
Guy. (1980). Retail Location and Retail Planning in Britain. University of Wales: Institute of Science and Technology.
International Co-operative Alliance. (2005). Co-operative History 2005, July. Dicapai pada Oktober 06, 2008 daripada http://www.ica.coop/coop/history.html.
Khalid. (2008). Menteri Pembangunan Usahawan dan Koperasi. Temu duga Bersemuka. Kuala Lumpur.
Jabatan Perangkaan Malaysia. (2007). Buku Tahunan Perangkaan Malaysia 2007. Putrajaya.
Mohd Said, Z.A. (1990). The Structure of Retail Trade in Peninsular Malaysia. Kuala Lumpur: Arenabuku.
Mokhlis, S. & Sparks, L. (2007), Consumer religiosity and shopping behavior in Malaysia. Malaysian Management Journal, 11(1&2): 85-99.
Nik Yacob et al. (1992). Basic Marketing. Kuala Lumpur: Fajar Bakti.
Raja Maimon Raja Yusof. (1999, Januari). Masalah dan Kegagalan Koperasi Pengguna di Malaysia. Dimensi, 27-30.
Suruhanjaya Koperasi Malaysia. (2008). Laporan SKM 2008. Temuramah Bersemuka. Kuala Lumpur.
Suruhanjaya Koperasi Malaysia. (2009). Laporan SKM 2009. Temuramah Bersemuka. Kuala Lumpur.
AUTHORS’ BACKGROUND
Norazlan Hasbullah is the Director of the Research Management and Innovation Centre as well as Chief Editor for the Malaysian Journal of
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Co-operative Studies, at the Co-operative College of Malaysia (CCM). He has more than 10 years experience as a trainer with CCM and besides training, has undertaken a number of research studies related to co-operative management. He holds a Masters in Business Administration from Universiti Malaya, Malaysia and Bachelor in Business Administration with Honours from Universiti Kebangsaan Malaysia.
Noranita Mohd Nor has been a lecturer with the Business Management and Entrepreneurial Centre, Co-operative College of Malaysia (CCM) since 2007. She holds a Bachelor in Business Administration with Honours (Marketing) and Diploma In Banking from Universiti Teknologi MARA, Malaysia. Besides being an experienced trainer in business, management and entrepreneurial, she also provides advisory service to co-operatives and has been involved in research studies in these areas. Mohd Faisal Shariff has been a lecturer with the Business Management and Entrepreneurial Centre, Co-operative College of Malaysia (CCM) since 2004. He hold a Bachelor in Economics with Honours (Marketing) from Universiti Kebangsaan Malaysia. Besides being an experienced lecturer in business, management and entrepreneurial, he also provides advisory service to co-operatives and has been involved in research studies in these areas.
Ju Samsuddin Safian has been a lecturer with the Business Management and Entrepreneurial Centre, Co-operative College of Malaysia (CCM) since 2006. He hold a Bachelor in Business Administration with Honours (Marketing) from Universiti Utara Malaysia. Besides being an experienced lecturer in business, management and entrepreneurial, he also provides advisory service to co-operatives and has been involved in research studies in these areas.
Arfizawati Abd Hadi has been a lecturer with the Business Management and Entrepreneurial Centre, Co-operative College of Malaysia (CCM) since 2004. She holds a Bachelor in Business Administration with Honours (International Business) and Diploma In Banking from Universiti Teknologi MARA, Malaysia. Besides being an experienced lecturer in business, management and entrepreneurial, she also provides advisory service to co-operatives and has been involved in research studies in these areas.
TAHAP PENGAMBILAN RISIKO DALAM GERAKAN KOPERASI DI MALAYSIA
Norwatim Hj Abd Latiff
Maktab Koperasi Malaysia
ABSTRACT
Risktakinginvolveddecisionmadebytheco-operativeboardmemberonsomeformsof investmentwhichare fundedby internalorexternalfinancing. Inco-operativeentrepreneurshiplevelresearch,risktakingwasusedtoidentifyboardmembersactionindevelopingtheirco-operative.Matterstoassessedtheseitemsincludeexternalfinancingusage,difficultyonmanagingtheinvestments,instrumentthatchosentosettingasideoffundsexcess,investmentvaluationmethod,andnewhighriskinvestmentexploration.Researchshowedthatrisktakingwerestillatlowlevelwhenmoreco-operativesdecidednottouseexternalfinancingbecausetheydonotdaretobearthelossesandinabilitytopaybacktheirloan.Moreco-operativeschoosetoinvestinsaferinvestment.Besidesthat,co-operativealsolessinterestedinmanagingbigfundsizetoavoidfromdifficultyinrunningco-operativerespectively.Theyaremorecomfortabletomanagefundinsmallandmediumsize.Excessfundswerealsokeptinfixeddeposit.Thisobviouslyshowsalargeamountofco-operativechoosetoinvestininstrumentoflowriskascomparedtomaking investment in high risk instrument. At the same time, valuation method used for co-operativesarereturnoninvestmentandfindingsrevealedthatco-operativeshaveuselessexpertserviceinmakinginvestmentevaluation.
ABSTRAK
Pengambilan risiko melibatkan satu pembuatan keputusan oleh anggota lembaga koperasi terhadap sesuatu bentuk pelaburan samaada dibiayai oleh pembiayaan dalaman ataupun luaran.Dalampenyelidikantahapkeusahawanankoperasi,angkubahpengambilanrisikotelah digunakan untuk melihat gelagat anggota lembaga dalam memajukan sesebuah koperasi. Perkara yang dinilai adalah merangkumi aspek penggunaan pembiayaan luaran, kesukaran mengurus pelaburan, instrumen yang dipilih untuk menyimpan dana berlebihan, kaedah penilaian pelaburan, dan penerokaan pelaburan baru berisiko tinggi. Penyelidikan menunjukkan angkubah pengambilan risiko masih pada tahap rendahapabilamajoritikoperasilebihcenderunguntuktidakmenggunakanpembiayaanluaran kerana mereka tidak berani menanggung kerugian dan berkemungkinan tidak mampu menjelaskan balik pinjaman. Kebanyakan koperasi memilih untuk melabur dalam pelaburan yang selamat.
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Selain itu, koperasi juga didapati kurang berminat dalam menguruskan dana bersaiz besar kerana ingin mengelak dari kesukaran dalam menguruskan koperasi masing-masing.Majoritinyalebihselesamenguruskandanayangbersaizkecildansederhana.Lebihandanayangdimilikikoperasijugadisimpandalambentukinstrumensimpanantetap. Ini jelas menunjukkan sebilangan besar koperasi memilih untuk melabur dalam instrumen yang berisiko rendah berbanding membuat pelaburan dalam instrumen yang berisiko tinggi. Di samping itu, kaedah penilaian yang digunakan bagi kebanyakan koperasiialahpulanganataspelaburan(ReturnOnInvestment)dankoperasi-koperasiini juga kurang menggunakan khidmat pakar dalam membuat penilaian pelaburan.
LATAR BELAKANG
Artikel ini adalah merupakan sebahagian kecil daripada Penyelidikan Tahap Keusahawanan Koperasi di Malaysia (2009-2010) yang melibatkan penulis dengan rakan-rakan anggota penyelidik yang lain.
Melalui ulasan karya dan perbincangan dalam kumpulan fokus, 9 angkubah penentu tahap keusahawanan dalam koperasi telah dikenalpasti untuk dikaji dalam penyelidikan di atas. Angkubah-angkubah tersebut ialah halatuju, tahap inovasi, pengambilan risiko, keupayaan mengenalpasti peluang, kecekapan menguruskan sumber, pengiktirafan, penerapan budaya keusahawanan, pengurusan berkesan dan pengantarabangsaan.
SKOP PENULISAN
Arikel ini hanya melihat pengambilan risiko sebagai salah satu angkubah penentu tahap keusahawanan dalam koperasi. Walaupun penyelidikan yang dijalankan menunjukkan 9 angkubah yang dikaji sangat berkait rapat antara satu sama lain sebagai penentu tahap keusahawanan dalam koperasi.
Pengambilan risiko yang akan dibincangkan adalah merangkumi:
i. Penggunaan pembiayaan luaran
ii. Kesukaran mengurus pelaburan
iii. Instrumen yang dipilih untuk menyimpan dana berlebihan
iv. Kaedah penilaian pelaburan
v. Penerokaan pelaburan baru berisiko tinggi
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PERMASALAHAN KAJIAN
Sesebuah perusahaan yang berdaya tahan dan berdaya saing merupakan organisasi perniagaan yang berinovasi dan berani mengambil risiko untuk merebut peluang yang terdapat di persekitaran perniagaan yang dinamik. Sumbangan Keluaran Dalam Negara Kasar (KDNK) sektor koperasi iaitu 1 peratus (2009) adalah terlalu kecil jika dibandingkan dengan sektor lain. Gelagat pemegang taruh koperasi dalam pengambilan risiko untuk membuat keputusan terhadap sesuatu pelaburan sangat penting untuk menjadikan koperasi sebagai organisasi yang dinamik dan berdaya siang. Oleh itu, satu kajian untuk mengenal pasti tahap pengambilan risiko oleh koperasi perlu dijalankan.
Objektif
i. Untuk melihat sejauh manakah koperasi melibatkan diri dalam pelaburan yang berisiko tinggi dengan modal yang dimiliki samaada melalui pembiayaan luaran atau dalaman.
ii. Melihat kedudukan angkubah pengambilan risiko koperasi pada tahap keusahawanan rendah, tahap keusahawanan sederhana dan tahap keusahawanan tinggi.
Kepentingan Kajian/Penulisan
i. Kajian ini dapat memberi gambaran kepada agensi dan jabatan yang menyelia dan melatih koperasi akan kedudukkan koperasi semasa dalam melibatkan diri dalam aktiviti perniagaan. Samaada masih terikat dengan aktiviti tradisonal seperti kredit atau kepada aktiviti yang lebih mencabar dan berisiko tetapi menjanjikan pulangan yang lebih baik.
ii. Jabatan/agensi yang terlibat dapat merangka pendekatan yang lebih baik samaada dari segi penyeliaan dan latihan supaya koperator-koperator lebih proaktif dan dinamik dalam membuat keputusan pelaburan dan melihat aspek risiko dengan lebih rasional.
ULASAN KARYA
Aspek keusahawanan dalam gerakan koperasi di Malaysia masih belum banyak di buat kajian dan hampir keseluruhan kajian yang dibuat adalah tertumpu kepada ciri-ciri keusahawanan individu dalam sesuatu perusahaan. Konsep keusahawanan umumnya dikaitkan dengan penjanaan kekayaan ekonomi untuk
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individu, pengusaha-pengusaha dan seterusnya kepada masyarakat melalui cukai yang dibayar kepada kerajaan. Faedah sosial keusahawanan kepada masyarakat diakui (Venkataraman, 1977), menegaskan bahawa keusahawanan sebagai sebahagian daripada perspektif kebajikan sosial yang tidak hanya mementingkan diri sendiri tetapi pada masa yang sama memperkembangkan ekonomi sosial dengan menjanakan pembaharuan dari segi pasaran, industri, teknologi, institusi, peluang pekerjaan serta meningkatkan tahap produktiviti (Haugh & Pardy, 1999). Ini bermakna kajian keusahawanan dalam koperasi amat relevan dalam konteks hari ini, manfaat ekonomi dan sosial sesuatu organisasi bermotifkan keuntungan mendapat perhatian dari pelbagai pemegang taruh (stakeholders). Aktiviti keusahawanan bukan sahaja terdapat dalam syarikat-syarikat persendirian tetapi juga dalam gerakan koperasi. Malah, koperasi sepatutnya mengamalkan sifat-sifat keusahawanan yang tinggi dalam mencapai matlamat sosioekonomi anggota. Koperasi boleh dianggap sebagai entiti perniagaan yang bertujuan untuk kepentingan sosial di mana kelebihan boleh didapati melalui dana dari sumber dalaman dan juga luaran yang membolehkan aktiviti perniagaan dijalankan untuk bersaing di pasaran. Dana perusahaan sosial seperti ini dikaitkan dengan pelaburan portfolio dalam proses menjana satu jaringan perusahan sosial yang unik. Keunikannya adalah melalui sistem penyampaian produk dan perkhidmatan kepada anggota berbeza dengan kaedah yang digunakan dalam entiti perniagaan yang lain. Uniknya di sini disebabkan koperasi mempunyai hubungan integrasi menegak bermula daripada koperasi peringkat prima, menengah dan puncak (apex). Dalam konteks koperasi juga, di samping kualiti dan kuantiti output sosial dan ekonomi, kesan kepada persekitaran alam sekitar perlu diambilkira dalam mengukur prestasi. Jelasnya pendekatan keusahawanan sosial dalam koperasi berorientasikan ke arah mengecilkan jurang sosial dan ekonomi. Secara idealnya, koperasi perlu memenuhi kehendak pemegang taruh, keperluan pasaran dan kesejahteraan masyarakat. Hasilnya nanti perubahan sosial yang diperjuangkan oleh gerakan koperasi akan memberi perubahan taraf hidup masyarakat keseluruhan.
Satu penyelidikan bertajuk ciri-ciri keusahawanan dan amalan pengurusan di kalangan pengurus-pengurus koperasi di Malaysia dijalankan oleh sekumpulan penyelidik dari Maktab Kerjasama Malaysia oleh Raja Maimon Raja Yusof, Sushila Devi, Jamilah Din, Nurizah Noordin dan Noraesyah Saari (2002) mendapati hampir keseluruhan responden memenuhi ciri-ciri keusahawanan yang disarankan oleh Geoffrey G. Meredith, Robert E. Nelson dan Philip A. Neek (1982). Walaubagaimanapun skor kelompok yang paling rendah (skor bawah 73%) terdiri daripada ciri-ciri mengambil risiko, berwawasan, kreatif dan inovatif, berdikari, kualiti memimpin, kerja keras dan keyakinan yang tinggi. Kajian ini bagaimanapun tidak mengukur gelagat keusahawanan koperasi itu sendiri. Justeru, kajian yang melibatkan tahap
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keusahawanan dalam koperasi adalah releven dan penting pada masa ini. Dalam penyelidikan ini pengambilan risiko bukan dikaji sebagai satu ciri tetapi sebagai satu angkubah melihat gelagat pemegang taruh koperasi dalam membuat keputusan berkaitan pelaburan.
METODOLOGI KAJIAN
Kerangka sempel diperolehi daripada direktori koperasi 2007 (SKM). Jumlah koperasi berdaftar adalah sebnyak 6084 buah koperasi. Bagaimanapun jumlah koperasi dalam populasi ialah 2963 buah koperasi setelah ditolak koperasi sekolah (2039 buah) dan dua koperasi perbankan. Proses pemilihan sampel adalah dengan mengklusterkan koperasi mengikut fungsi dan kemudiannya distratakan mengikut negeri dan zon.
Instrument kajian terdiri daripada borang soal selidik yang dibahagikan kepada dua seksyen. Seksyen A merupakan profil koperasi dan profil pengerusi/setiausaha/ pengurus dan seksyen B mengandungi angkubah-angkubah yang dikenalpasti untuk kajian. Dua kajian rintis telah dijalankan bertujuan memastikan soalan mudah difahami dan menepati objektif kajian.
Data dikumpul melalui temuduga bersemuka oleh penyelidik dengan bantuan pembanci. Analisis data yang dikumpul adalah menggunakan pakej statistik SPSS melalui ujian Kolmogorouv Smirnov analisis diskriptif, jadual silang (crosstabulation) dan chi square (inferential analysis).
PERBINCANGAN DAN ANALISIS (OBJEKTIF I )
Penggunaan Pembiayaan Luar
Jadual 1 mengukur sejauh mana koperasi berani mengambil risiko dalam konteks menggunakan pinjaman luar sebagai sumber pembiayaan. Dalam tempoh tiga tahun ke belakang, kajian mendapati majoriti responden tidak mendapatkan pembiayaan luar untuk membiayai projek mereka. Hanya 160 buah koperasi (34.6%) pernah mendapatkan pembiayaan luaran manakala majoriti sebanyak 302 buah koperasi (65.4%) tidak menggunakan pembiayaan luaran. Kecenderungan majoriti koperasi untuk tidak menggunakan pembiayaan luaran menunjukkan mereka lebih berhati-hati atau tidak mahu menanggung risiko pinjaman. Daripada jumlah koperasi yang pernah mengambil pinjaman, 128 buah koperasi (90.7%), telah meminjam antara satu hingga tiga kali, manakala selebihnya pernah meminjam lebih daripada tiga kali. Kekerapan yang rendah untuk mendapatkan pembiayaan luaran menunjukkan majoriti koperasi mempunyai tahap pengambilan risiko yang rendah.
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Jadual 1: Pengambilan Risiko – Pembiayaan Luaran
Pernyataan Frekuensi Peratus
Dalam tiga tahun kebelakangan ada pembiayaan luar biayai projek
YaTidak
160302
34.665.4
Bilangan/Frekuensi pinjaman 1 - 3 kali4 - 6 kali7 - 10 kaliLebih daripada 10 kali
128823
90.75.61.42.1
Jenis-jenis pelaburan Penubuhan subsidiariPenyelesaian hutangPembelian aset(bangunan/kedai/ pejabatModal perniagaanLain-lain
121662
71 34
7.510.139.0
44.721.4
Jika dikaji dari segi jenis pelaburan yang dibuat menggunakan pembiayaan luaran, kajian mendapati majoriti koperasi memilih untuk melabur dalam pelaburan yang selamat. Didapati 71 buah koperasi (44.7%) menggunakan dana pinjaman tersebut untuk dijadikan modal perniagaan, diikuti dengan 62 buah koperasi (39%) memilih untuk melabur dalam aset seperti membeli kedai, pejabat dan bangunan.
Kesukaran Mengurus Dana (Mengikut Saiz)
Kajian mendapati, sebanyak 154 buah koperasi (34.5%) menyatakan bahawa mereka menghadapi kesukaran dalam menguruskan pelaburan koperasi masing-masing. Manakala majoriti koperasi (65.5%) tidak menghadapi kesukaran (Lihat Jadual 2). Daripada jumlah responden yang menyatakan mempunyai kesukaran mengurus pelaburan, majoritinya mengurus dana yang bersaiz sederhana berbanding dengan saiz kecil atau besar. Dapatan ini menunjukkan anomali di mana menguruskan saiz pelaburan yang lebih besar sepatutnya lebih sukar jika dibandingkan dengan saiz pelaburan kecil atau sederhana. Percanggahan ini mungkin disebabkan oleh kekeliruan responden yang mungkin merujuk kesukaran mengurus kepada saiz dana yang kecil tetapi pelbagai dalam portfolio yang diuruskan. Namun, walaupun dikatakan terdapat kesukaran dalam menguruskan pelaburan, kajian berpendapat bahawa tahap pengambilan risiko masih rendah memandangkan majoriti koperasi melaporkan masalah ini adalah dalam kalangan mereka yang menguruskan saiz dana yang kecil dan sederhana. Dari segi saiz dana, median bagi jumlah dana bersaiz kecil adalah sebanyak RM23,000, saiz sederhana adalah sebanyak RM150,000 dan dana bersaiz besar adalah sebanyak RM375,000.
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Jadual 2: Pengambilan Risiko – Kesukaran Mengurus Dana (Mengikut Saiz)
Pernyataan Frekuensi Peratus
Pelaburan sukar diuruskan? YaTidak
154293
34.565.5
Saiz pelaburan KecilSederhanaBesar
576827
37.544.717.8
Median jumlah pelaburan KecilSederhanaBesar
(RM)23,000150,000375,000
Instrumen Simpanan yang Digunakan
Pemilihan jenis instrumen untuk menyimpan lebihan dana yang dimiliki koperasi boleh mencerminkan tahap kesediaan mengambil risiko pemilik koperasi tersebut. Jadual 3 menunjukkan taburan responden yang menyimpan lebihan dana dalam pelbagai jenis instrumen simpanan yang ada di negara ini. Kajian mendapati 286 buah koperasi (67.6%) memilih untuk menyimpan dalam instrumen simpanan tetap (fixeddeposit), manakala sebanyak 121 buah koperasi (28.7%) memilih untuk melabur dengan membeli saham tak siar harga. Sebanyak 101 buah koperasi (23.9%) melabur dalam unit saham amanah. Jika dilihat daripada jenis instrumen yang dipilih jelas menunjukkan bahawa majoriti koperasi memilih untuk melabur dalam instrumen yang berisiko rendah dan secara tidak langsung mempamerkan tahap pengambilan risiko yang rendah dalam kalangan mereka.
Jadual 3: Pengambilan Risiko: Instrumen Simpanan yang Digunakan
Pernyataan Frekuensi Peratus Jenis-jenis instrumen simpanan Simpanan tetap
Unit saham amanah Saham tak siar harga Saham siar harga Lain-lain
2861011218962
67.623.928.721.014.7
Simpanan tetap Unit saham amanah
(RM)128,012100,000
Median jumlah simpanan Saham tak siar harga Saham siar harga Lain-lain
96,914170,00064,362
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Kaedah Penilaian yang Digunakan & Penggunaan Khidmat Pakar
Kajian mendapati majoriti responden menggunakan kaedah penilaian pelaburan biasa tanpa mengambil kira nilai masa pada wang. Di kalangan koperasi, kaedah yang kerap digunakan adalah pulangan atas pelaburan, 194 buah koperasi (45.6%) diikuti dengan 131 buah koperasi (30.8%) menggunakan jangkamasa bayar balik manakala penilaian yang lebih saintifik seperti nilai bersih semasa dan kadar pulangan dalaman masing-masing digunakan pada kadar yang rendah. Di samping itu, majoriti responden sebanyak 272 buah koperasi (60.4%) tidak menggunakan khidmat pakar dalam membuat penilaian pelaburan (Lihat Jadual 4).
Jadual 4: Pengambilan Risiko:Kaedah Penilaian yang Digunakan & Penggunaan Khidmat Pakar
Pernyataan Frekuensi Peratus
Kaedah Penilaian Pulangan atas pelaburan
Pulangan sosial atas pelaburan
Kadar pulangan dalaman
Nilai bersih semasa
Jangkamasa bayar balik
Lain-lain
194
68
36
46
131
22
45.6
16.0
8.5
10.8
30.8
5.2Menggunakan khidmat pakar? Ya
Tidak
178
272
39.6
60.4
Penerokaan Pelaburan Berisiko Tinggi
Jadual 5 menunjukkan taburan responden yang terlibat dalam penerokaan pelaburan baru berisiko tinggi. Majoriti responden iaitu 363 buah koperasi (80.1%) menyatakan tidak melibatkan diri dalam bidang baru yang berisiko tinggi. Daripada jumlah koperasi terlibat dalam membuat pelaburan baru, hanya 15 buah koperasi (29.4%) terlibat dalam projek pertanian, ternakan, perladangan dan perkapalan.
Perbincangan dan Analisis (Objektif II)
Dalam kajian bertajuk tahap keusahawanan dalam gerakan koperasi di Malaysia, untuk menentukan nilai sumbangan setiap angkubah termasuk pengambilan risiko dalam penentuan tahap keusahawanan koperasi, pendekatan secara indeks dibuat untuk mengenal pasti tahap keutamaan setiap angkubah. Setiap angkubah diberi nilai wajaran antara 0 dan 1 bagi menilai sumbangan terhadap penjanaan aktiviti
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keusahawanan koperasi. Wajaran yang lebih tinggi diberi kepada angkubah yang dijangka memberi sumbangan besar kepada aktiviti keusahawanan. Keutamaan dan wajaran ditentukan berdasarkan analisis dan hasil kajian pendidikan kerana sehingga kini tiada instrumen yang mempunyai kebolehpercayaan yang tinggi untuk dijadikan sandaran. Oleh itu, penyelidik menggunakan konsep arbitary. Angkubah yang dianggap memberi sumbangan besar seperti keupayaan mengenal pasti dan merebut peluang, pengambilan risiko, inovasi dan pengurusan berkesan diberi nilai wajaran 0.15 sementara angkubah-angkubah lain diberi wajaran 0.10 dan 0.05. Untuk menentukan sumbangan setiap angkubah kepada proses keusahawanan setiap item dalam angkubah tersebut juga diberi skor. Skor maksimum bagi setiap angkubah adalah 100 manakala skor bagi setiap item diberi nilai mengikut kepentingannya dalam angkubah tersebut.
Hasil skor penilaian terhadap tahap keusahawanan secara keseluruhannya ditunjukkan dalam Jadual 6. Tahap keusahawanan dibahagikan kepada tiga iaitu tahap rendah, sederhana dan tinggi. Koperasi yang mendapat skor kurang daripada 0.4 diklasifikasikan berada dalam tahap keusahawanan rendah, manakala koperasi yang mendapat skor di antara 0.4 dan 0.6 diklasifikasikan berada pada tahap keusahawanan sederhana. Sementara itu koperasi yang mendapat skor lebih daripada 0.6 diklasifikasikan berada pada tahap keusahawanan tinggi. Min skor keseluruhan adalah 0.4.
Jadual 5: Pengambilan Risiko: Penerokaan Pelaburan Berisiko Tinggi
Pernyataan Frekuensi Peratus
Meneroka bidang baru berisiko? Ya
Tidak
90
363
19.9
80.1
Bidang baru yang diteroka Pinjaman anggota
Pelaburan hartanah
Projek pertanian/
ternakan/perladangan
& perkapalan
Ar-rahnu
Kontrak
Lain-lain
3
8
15
1
1
23
5.9
15.7
29.4
2.0
2.0
45.1
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4. Inovasi 0.15 A1A2A3A4A5A6
202010202010
Jumlah 1006. Pengurusan Berkesan 0.15 I1
I2I3I4I5I6I7I8I9
5201010101020510
Jumlah 1001. Hala Tuju 0.1 B1
B2B3B4
10502020
Jumlah 1005. Pembudayaan Keusahawanan 0.1 H1
H2H3H4
20403010
Jumlah 100
Jadual 6: bersambung
Keutamaan (Rank*)
Angkubah Wajaran** Sub item Skor Maksimum (%)
2. Keupayaan Mengenal Pasti dan Merebut Peluang
0.15 D1D2D3D4
10305010
Jumlah 1003. Pengambilan Risiko 0.15 C1
C2C3C4C5C6C7
1520202010105
Jumlah 100
Jadual 6: Senarai Keutamaan dan Wajaran
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Berdasarkan kepada Jadual 7, didapati sebanyak 251 buah koperasi (54%) berada pada tahap keusahawanan rendah, 188 buah koperasi (40.4%) berada pada tahap sederhana dan 25 buah koperasi (5.6%) berada pada tahap keusahawanan tinggi. Ini menunjukkan bahawa hanya sebilangan kecil sahaja koperasi mempunyai tahap keusahawanan yang membanggakan. Dapatan kajian juga menunjukkan lebih daripada separuh bilangan koperasi yang terlibat dalam kajian ini berada pada tahap keusahawanan rendah. Namun begitu, agak membanggakan apabila didapati lebih kurang 40% berada pada tahap keusahawanan yang sederhana. Ini menunjukkan satu penemuan yang menarik kerana koperasi yang berada pada tahap keusahawanan yang sederhana berpotensi untuk meningkat kepada tahap keusahawanan tinggi sekiranya aktiviti keusahawanan dipertingkatkan. Aktiviti keusahawanan harus dipertingkatkan oleh koperasi-koperasi yang berada pada tahap rendah dan sederhana manakala koperasi yang berada pada tahap tinggi perlu
Keutamaan (Rank*)
Angkubah Wajaran** Sub item Skor Maksimum (%)
Jadual 6: Sambungan
7. Kecekapan Pengurusan Sumber 0.1 E1E2E3E4E5E6E7E8E9E10E11
155551510101010105
Jumlah 1008. Pengiktirafan 0.05 F1
F2F3F4F5
1010302030
Jumlah 1009. Pengantarabangsaan 0.05 G1
G1aG1bG1cG1d
2020202020
Jumlah 100JUMLAH BESAR 1 900
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memantapkan aktiviti keusahawanan sedia ada dengan mengambil kira sembilan angkubah yang diukur dalam penyelidikan ini. Ketiga-tiga tahap keusahawanan koperasi ditunjukkan jelas melalui tipologi keusahawanan koperasi iaitu tipologi tahap keusahawanan rendah, tipologi tahap keusahawanan sederhana dan tipologi tahap keusahawanan tinggi. Lihat Rajah 1 di bawah:
Jadual 7: Penilaian Tahap Keusahawanan Secara Keseluruhan
Tahap Indeks Bilangan Peratus
Keusahawanan Rendah <0.4 251 54.0Keusahawanan Sederhana 0.4 – 0.6 188 40.4Keusahawanan Tinggi >0.6 25 5.6Jumlah 465 100.0
Rajah 1: Perbandingan Tipologi Tahap Keusahawanan
Rajah 1 di atas menunjukkan corak tahap keusahawanan yang diperoleh daripada purata skor bagi semua angkubah yang telah diukur pada setiap tipologi tahap
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keusahawanan. Ia jelas menunjukkan bahawa corak skor tahap keusahawanan adalah hampir sama dalam semua tahap cuma yang berbeza adalah dari segi intensitinya sahaja.
Dalam aspek pengambilan risiko, kajian mendapati amalan pengambilan risiko masih lagi rendah bagi setiap kategori. Penemuan ini menunjukkan terdapat jurang di antara kemampuan mengambil risiko oleh koperasi dalam setiap kategori. Ini menunjukkan kecenderungan mengambil risiko berbeza pada setiap tahap keusahawanan. Kajian menunjukkan mereka hanya menjalankan aktiviti-aktiviti yang berisiko rendah atau memilih untuk berada dalam zon selamat. Sebagai contoh, majoriti koperasi memilih untuk menyimpan wang lebihan mereka dalam simpanan tetap yang sangat berisiko rendah.
Jadual 8 menunjukkan analisis jurang antara angkubah pada ketiga-tiga tahap keusahawanan. Bagi tahap keusahawanan koperasi tinggi dengan tahap keusahawanan koperasi sederhana jurang angkubah pengambilan risiko adalah sebanyak 20.1% dan antara tahap keusahawanan koperasi sederhana dengan tahap keusahawanan koperasi rendah jurang risiko adalah sebanyak 17.5%. Ini menjadikan jumlah jurang pengambilan risiko keseluruhannya ialah 37.6%.
Jadual 8: Analisis Jurang Antara Angkubah-angkubah Tahap Keusahawanan
Angkubah Tinggi (%)
Jurang Sederhana (%)
Jurang Rendah (%)
Jumlah Jurang
Pengantarabangsaan 11.5 11.3 0.2 0.2 0.0 11.5Pengiktirafan 44.0 11.3 28.7 9.3 19.4 20.6Pengambilan Risiko 53.2 20.1 33.1 17.5 15.6 37.6Inovasi 63.5 22.7 40.8 22.6 18.2 45.3Pembudayaan Keusahawanan
63.5 23.3 40.2 18.4 21.8 41.7
Kecekapan Pengurusan Sumber
66.7 18.2 48.5 18.5 30.0 36.7
Hala Tuju 72.5 9.4 63.1 26.6 36.5 36.0
Keupayaan Mengenal Pasti & Merebut Peluang
85.5 28.4 57.1 13.3 37.8 41.7
Pengurusan Berkesan 85.0 8.6 76.4 5.6 70.8 14.2
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RUMUSAN
Secara umumnya, penemuan penyelidikan menunjukkan banyak koperasi memilih untuk menyimpan dana yang tidak digunakan dalam bentuk instrumen kewangan yang berisiko rendah berbanding dengan instrumen berisiko tinggi. Walau bagaimanapun, hukum pelaburan menunjukkan bahawa lebih tinggi risiko yang diambil, maka pulangan yang diraih juga lazimnya tinggi. Penyelidik berpendapat bahawa dengan menganalisis instrumen simpanan kewangan yang lazim digunakan oleh koperasi, penganalisis boleh mengandaikan tahap pengambilan risiko koperasi tersebut. Ia menunjukkan koperasi kurang mempelbagaikan bentuk pelaburan justeru untuk mengelak daripada mengambil risiko. Ia mungkin juga disebabkan oleh kurangnya pengetahuan dan pengalaman dalam bidang pengurusan portfolio pelaburan.
Pembiayaan luaran merujuk kepada kesediaan koperasi untuk mendapatkan pembiayaan daripada sumber luaran bagi tujuan pelaburan. Koperasi yang mampu menggunakan pembiayaan luaran menunjukkan tahap pengambilan risiko yang lebih tinggi berbanding dengan koperasi yang hanya menggunakan dana sendiri. Kesediaan mengambil pembiayaan luaran sebenarnya mendedahkan koperasi kepada risiko hutang/kredit dan secara tidak langsung menyebabkan koperasi tersebut lebih komited terhadap pelaburan yang ingin dibuat dengan dana yang diperoleh daripada luar. Kekerapan menggunakan sumber pembiayaan luaran juga menunjukkan kemampuan koperasi membayar balik pinjaman sesuai dengan tahap risiko yang diambil. Di samping itu, jenis pelaburan yang dibuat menggunakan sumber pembiayaan luaran boleh mencerminkan tahap pengambilan risiko koperasi terbabit.
Kesukaran mengurus pelaburan boleh dijadikan satu daripada dimensi pengukuran tahap pengambilan risiko dalam kalangan responden. Lazimnya, saiz pelaburan berkait rapat dengan kesukaran mengurus dan pengambilan tahap risiko. Misalnya, koperasi yang mengurus saiz dana pelaburan yang kecil, kurang menghadapi kesukaran dalam menguruskan risiko berbanding dengan koperasi yang terlibat dalam mengurus dana pelaburan bersaiz besar.
Kaedah penilaian projek atau pelaburan yang digunakan oleh koperasi dalam menilai daya maju dan seterusnya membuat keputusan pelaburan juga boleh dijadikan pengukur tahap pengambilan risiko koperasi terbabit. Lazimnya, kaedah kuantitatif dan mengambil kira nilai masa pada wang (time value of money) dilihat sebagai kaedah berkesan dalam membuat penilaian pelaburan. Ia juga melambangkan tahap kesediaan mengambil risiko sesebuah koperasi.
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Kesanggupan koperasi untuk meneroka peluang pelaburan baru yang pastinya berisiko lebih tinggi juga mencerminkan tahap pengambilan risiko yang tinggi oleh koperasi yang ada membuat pelaburan sedemikian. Penyelidik menggunakan kriteria ini sebagai salah satu pengukur tahap pengambilan risiko kerana ia dengan jelas menunjukkan kecenderungan koperasi untuk mengambil risiko yang lebih tinggi justeru mengharapkan pulangan yang lebih tinggi.
RUJUKAN Norwatim Abd Latiff, Mohd Rasydi Abd Rashid, Suraya Husin, Ayu Diana Awang, Mohd
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AUTHOR’S BACKGROUND
Norwatim Abd Latiff is the Head of International and Higher Education Centre at the Co-operative College of Malaysia (CCM). She has more than 28 years experience in conducting training and providing advisory services for co-operatives in Malaysia. Norwatim Abd Latiff has carried out a number of research studies related to co-operative management. She holds a Masters in Business Administration (1994) and Bachelor in Economics with Honours (1979) from the University of Malaya, Malaysia. She also holds PostGraduate Diploma in Co-operative Management Consultancy (1984) from Netherland.
Research Management and Innovation CentreCO-OPERATIVE COLLEGE OF MALAYSIA
103, Jalan Templer, 46700 Petaling Jaya, Selangor, MalaysiaTel: 603-7964 9000 Fax: 603-7957 0434
E-mail: [email protected]
ISSN 1823-5387
VOLU
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