CHAPTER 1

INTRODUCTION

1.1 Background of the Study

The survival of a firm depends on its ability to survive with its internal  and  external environmental factors. Drucker (1979) says that corporate performance should portray how effective and efficient is in terms of its profitability, growth, cost minimization and productivity. Schumpeter argued that innovation plays a key role for the survival of firms, innovation “strikes not at the margins of the profits and the out of the existing firms but at their foundations and their very lives” (Schumpeter, 1942:84). The nature of technology also shapes the likelihood of survival, as revealed by a classification of firms according to Paritt, (1984). Every organization works towards survival. As survival is the major goal of most of most organization (Barnard, 1947). Paying attention to this goal contributes to the satisfaction and execution of other organizational goal.

Corporate survival has been the most interesting topics for organizations over the years. Organizations exist to survive in the midst of environmental factors that tend to encroach on business performance. Organizations attempt to maintain the existing state of affairs, but essentially the larger part of their efforts is tilted toward survival (Mindy, 1998).   The competition in the industry is getting stronger and firms are adopting different strategies to be competitive in the industry. Surviving in the global struggle to meet with increasing demand on firms in the market place has seen many researchers and academicians having a resort to pay attention to the individual employees in the organization since innovation in product and services are brought about by these individuals. In this study, two measures of corporate survival were reviewed (Sopiah, 2016). One construct that can enhance corporate survival in collective bargaining.

According to Rose (2008), the term collective bargaining was originated by Webb and Webb to describe the process of agreeing terms and conditions of employment through representatives of employers (and possibly their associations) and representatives of employees (and probably their unions). Rose (2008) posits that collective bargaining is the process whereby representatives of employers and employees jointly determine and regulate decisions pertaining to both substantive and procedural matters within the employment relationship. The outcome of this process is the collective agreement. Collective bargaining as one of the processes of industrial relations performs a variety of functions in work relations. It could be viewed as a means of industrial jurisprudence as well as a form of industrial democracy. It is a means for resolving workplace conflict between labour and management as well as the determination of terms and conditions of employment. Davey (2002) views collective bargaining as “a continuing institutional relationship between an employer entity (government or private) and labour organization (union or association) representing exclusively a defined group of employees of said employer (appropriate bargaining unit) concerned with the negotiation, administration, interpretation and enforcement of written agreements covering joint understanding as to wages/salaries, rates of pay, hours of work and other  conditions  of  employment”. International Labour Organisation (ILO) (2004) views  “collective bargaining as negotiations about working conditions and terms of employment between an employer, a group of employers or one or more employers‟ organization, on the one hand and one or more representative workers‟ organization on the other, with a view to reaching agreement”.

Collective bargaining is thus seen as the ultimate in labour- management or even in industrial relations. It is one of the ways through which unions carry out their activities in handling industrial issues.

By its very nature, collective bargaining is democratic and as such introduces industrial democracy in the workplace. Through elected representations, workers make direct and significant count in the functioning of the organization, thus reducing employer’s unilateral actions and at the same time managements still allowed its legitimate rights and privileges to control the organization. The democratic nature of collective bargaining is that people in work relations are left to manage their own affairs, provided no damage is done to important general interest while doing so. Rom the foregoing therefore, the study is determined to examine the relationship between collective bargaining and corporate survival in some selected oil firms in Rivers State.

1.2 Statement of the Problem

The need for a conducive work environment, cordial relationship between the three actors in industrial relations (labour, management and the government) and how best to promote and maintain employee job satisfaction and productivity has engaged the attention of the management of both public and pirate organizations. This is because; it is a fact that these variables are very crucial to the survival of every organization. A close look at these variables suggests that Labour – management relations is a crucial factor that may determine or influence the other variables.  One basic feature of the components of an organization is varying interests.  Every stakeholder in an organization has his/her interest which normally may differ from other stakeholder’s interests. The  extent  to  which  these  interests  are  harmonized  and  satisfied  determines  the  extent  to  which  the organizational climate/environment is conducive for team work and maximum production. These interests are often realized through collective bargaining – an instrument in labour/management relations which allows both management and workers to discuss issues and take joint decisions that will ensure the survival of the organization.

1.3 Objectives of the Study

The main objective of the study is to examine the relationship between collective bargaining and corporate survival in some selected oil firms in Rivers State. The specific objectives are as follows:

i.        To examine the relationship between negotiation and corporate survival in some selected oil firms in Rivers State.

ii.       To examine the relationship between compensation and corporate survival in some selected oil firms in Rivers State.

iii.      To examine the relationship between job security and corporate survival in some selected oil firms in Rivers State.

iv.      To examine the relationship between dispute settlement and corporate survival in some selected oil firms in Rivers State.

1.4 Research Questions

i.        Is there any relationship between negotiation and corporate survival in some selected oil firms in Rivers State?

ii.       Is there any relationship between compensation and corporate survival in some selected oil firms in Rivers State?

iii.      Is there any relationship between job security and corporate survival in some selected oil firms in Rivers State?

iv.      Is there any relationship between dispute settlement and corporate survival in some selected oil firms in Rivers State?

1.5 Statement of Hypotheses

The following hypotheses were postulated to guide the study.

HO1: There is no significant relationship between negotiation and corporate survival in some selected oil firms in Rivers State.

HO2: There is no significant relationship between compensation and corporate survival in some selected oil firms in Rivers State.

HO3: There is no significant relationship between job security and corporate survival in some selected oil firms in Rivers State.

HO4: There is no significant relationship between dispute settlement and corporate survival in some selected oil firms in Rivers State.

1.6 Significance of the Study

The value of any study lies in its usefulness to the society. In view of this fact therefore, this study which focuses on collective bargaining and corporate survival is useful to managers in various organization especially the human resources department of oil firms, in Port Harcourt Rivers State.

Apart from its value to decision makers in organizations, this study is of immeasurable importance to students and lecturers of the faculty of management sciences who may like to further their understanding of the role of industrial relations practices in both government owned parastatals and private firms.

Above all, it is therefore hoped that this study will stimulate further studies in this area.

1.7 Scope/Limitation of the Study

The study examines the relationship between collective bargaining and corporate survival. It is designed to focus on Port Harcourt, metropolis Rivers State with special reference to selected oil firms in Rivers State.

The short period required for all completion of the study would introduced elements in rush, which will affect the researcher’s performance. Besides lack of enough money is also another chronic limitations among students of which the researcher was not exempted.

          The followings are limitations to the research work.

Finance: Accessing fund for the research work as difficult and this to a great extent limited the quality of research activity.

Time: The time allocated to the research work was not sufficient to give room for further intensive work on the field of study.

Organization Policy: Policies of some of the organizations visited limited the level of information received. The personnel of the firms were not willing to give information, stating that it was against the organization’s policy.

1.8 Definition of Related Terms       

BARGAINING: Negotiate the terms and conditions of a transaction.

COLLECTIVE:    Done by people acting as a group.

COLLECTIVE BARGAINING: Negotiation of wages and other conditions of employment by an organized body of employees.

COOPERATION: Cooperation is the most appropriate tool for managing organizational conflict if do not suffer the parties from time pressures. CORPORATE SURVIVAL: This is the continued existence of a company especially in a difficult or dangerous condition.