Home⇛International Journal of Multidisciplinary: Applied Business and Education Research⇛vol. 5 no. 1 (2024)

Factors Contributing to Business Failure and Eventual Exit among Selected Tutorial Service Centers

Ma Louise Gena D. Crisologo | Emilina R. Sarreal | Manuel R. Tanpoco

Discipline: Management

 

Abstract:

Business failure and exit are concomitants of business discontinuance which must be extensively studied as businesses such as tutorial centers can experience unfavorable events. This paper investigated the internal (i.e., owner/founder orientations) and external (i.e., compliance with government policies) antecedents leading to business failure and the eventual exit in the shadow education industry in 2013, particularly of Philippine privately owned tutorial centers which are divided into non-registered and registered services. Using the multiple case study approach, empirical findings showed that business failure is primarily caused by internal factors specifically the owner/founder orientations, while non-compliance with government regulations is secondary. The owner/founder orientations were comprised of motivation, characteristics/behavior, skill managerial deficiencies, capabilities, and financial knowledge shortcomings. Nonregistered tutorial centers asserted that only skill/managerial deficiencies and capabilities lead to failure while registered tutorial services perceived all as reasons for business failure. Not complying with government policies can affect more the registered tutorial services than the non-registered centers. Business exit was chosen by all the owners of tutorial centers as a viable option in case of business failure. Future studies can consider obtaining more participants and comprehensively investigating tutorial centers from different countries to enrich cross-country research in shadow education.



References:

  1. Ahmad, I., & Ahmad, S. (2018). Multiple skills and medium enterprises’ performance in Punjab Pakistan: A pilot study. The Jour-nal of Social Sciences Research, Special, (4), 44-49. https://doi.org/10.32861/jssr.spi4.44.49
  2. Amankwah-Amoah, J., Boso, N., & Antwi-Agyei, I. (2018). The effects of business failure experience on successive entrepreneurial engagements: An evolutionary phase model. Group & Organization Manage-ment, 43(4), 648-682. https://doi.org/10.1177/1059601116643447
  3. Amankwah-Amoah, J., Khan, Z., & Wood, G. (2021). COVID-19 and business failures: The paradoxes of experience, scale, and scope for theory and practice. European Management Journal, 39(2), 179-184. https://doi.org/10.1016/j.emj.2020.09.002
  4. Bonaccorsi, A., Barin, L., Belingheri, P., Biagi, F., & Sanchez-Barrioluengo, M. (2023). Is higher education more important for firms than research? Disentangling uni-versity spillovers. The Journal of Technol-ogy Transfer, 1-26. https://doi.org/10.1007/s10961-023-10008-y
  5. Bray, M. (2022). Shadow education in Asia and the pacific: features and implications of private supplementary tutor-ing. International handbook on education development in Asia-pacific, 1-23. https://doi.org/10.1007/978-981-16-2327-1_10-
  6. Bunyaminu, A., Mohammed, I., & Issah, M. (2019). Business Failure Prediction: A Tri-dimensional Approach. The Journal of Applied Business and Economics, 21(2), 80-100. https://doi.org/10.33423/jabe.v21i1.1456
  7. Bushe, B. (2019). The causes and impact of business failure among small to micro and medium enterprises in South Afri-ca. Africa’s public service delivery and performance review, 7(1), 1-26. https://doi.org/10.4102/apsdpr.v7i1.210
  8. Cefis, E., Bettinelli, C., Coad, A., & Marsili, O. (2022). Understanding firm exit: a sys-tematic literature review. Small Business Economics, 59(2), 423-446. https://doi.org/10.1007/s11187-021-00480-x
  9. Chirico, F., Gómez-Mejia, L. R., Hellerstedt, K., Withers, M., & Nordqvist, M. (2020). To merge, sell, or liquidate? Socioemotional wealth, family control, and the choice of business exit. Journal of Manage-ment, 46(8), 1342-1379. https://doi.org/10.1177/0149206318818723
  10. Davies, C., & van Vuuren, J. J. (2021). Entre-preneurship orientation and business dis-continuance: A relationship analysis of total early-stage activities in the BRICS countries. Journal of Contemporary Man-agement, 18(1), 455-481. https://doi.org/10.35683/jcm20078.113
  11. Ephrem, A. N., Nguezet, P. M. D., Charmant, I. K., Murimbika, M., Awotide, B. A., Ta-hirou, A., ... & Manyong, V. (2021). Entre-preneurial motivation, psychological cap-ital, and business success of young entre-preneurs in the DRC. Sustainability, 13(8), 4087. https://doi.org/10.3390/su13084087
  12. Hajar, A., & Karakus, M. (2022). A bibliometric mapping of shadow education research: achievements, limitations, and the fu-ture. Asia Pacific Education Re-view, 23(2), 341-359. https://doi.org/10.1007/s12564-022-09759-4
  13. Hashmi, M., Governatori, G., Lam, H. P., & Wynn, M. T. (2018). Are we done with business process compliance: state of the art and challenges ahead. Knowledge and Information Systems, 57(1), 79-133. https://doi.org/10.1007/s10115-017-1142-1
  14. Hohen, S., & Schweizer, L. (2021). Entrepre-neurs’ exit strategy intentions and their final exit paths. Schmalenbach Journal of Business Research, 73(3-4), 443-477. https://doi.org/10.1007/s41471-021-00123-7
  15. Klimas, P., Czakon, W., Kraus, S., Kailer, N., & Maalaoui, A. (2021). Entrepreneurial failure: a synthesis and conceptual framework of its effects. European Man-agement Review, 18(1), 167-182. https://doi.org/10.1111/emre.12426
  16. Lattacher, W., & Wdowiak, M. A. (2020). En-trepreneurial learning from failure. A sys-tematic review. International Journal of Entrepreneurial Behavior & Re-search, 26(5), 1093-1131. https://doi.org/10.1108/IJEBR-02-2019-0085
  17. Martinez, M. G., Zouaghi, F., Marco, T. G., & Robinson, C. (2019). What drives busi-ness failure? Exploring the role of inter-nal and external knowledge capabilities during the global financial crisis. Journal of Business Research, 98, 441-449. https://doi.org/10.1016/j.jbusres.2018.07.032
  18. Mayr, S., Mitter, C., Kücher, A., & Duller, C. (2021). Entrepreneur characteristics and differences in reasons for business fail-ure: evidence from bankrupt Austrian SMEs. Journal of Small Business & Entre-preneurship, 33(5), 539-558. https://doi.org/10.1080/08276331.2020.1786647
  19. , A., & Das, A. (2023). Entrepreneurial failure analysis using quality manage-ment approaches. Total Quality Man-agement & Business Excellence, 34(1-2), 235-260. https://doi.org/10.1080/14783363.2022.2043739
  20. Sheikh, R., Ayaz, M., & Siddique, M. A. (2023). Sharī ‘ah Governance and Sharī ‘ah Non-Compliance Risk Management: A Maqāsid Sharī ‘ah Based Appraisal. Journal of Is-lamic Thought and Civilization, 13(1). https://doi.org/10.32350/jitc.131.19
  21. Yin, R. K. (2009). Case study research: Design and methods 4th edition. In United States: Library of congress cataloguing-in-publication data.
  22. Zambrano Farias, F., Valls Martínez, M. D. C., & Martín-Cervantes, P. A. (2021). Explana-tory factors of business failure: literature review and global trends. Sustainability, 13(18), 10154. https://doi.org/10.3390/su131810154

Tools


Copyright © 2024  KITE Digital Educational Solutions |  Exclusively distributed by CE-Logic