Effects Of Professional Managers On Cooperative Business Performance: The Case Of Ambo Farmers’ Cooperative Union, Ambo Town West Shoa Zone, Oromia Regional State

Abstract

Agribusiness cooperatives face increasing challenges in global markets, requiring professional management for survival, growth, and competitiveness. Studies show that skilled managers improve operational efficiency, innovation, and profitability, while poor management leads to resource losses and inefficiencies. The main objective of this study was to investigate the effects of professional managers on cooperative business performance, specifically examining the effects of financial management practices on cash flow and analyzing the impact of strategic decision-making on business outcomes, while also providing insights into the role of professional managers in enhancing cooperative performance. A quantitative approach was employed, using a census method to gather data from all 151 members of the Ambo Farmers' Cooperative Union through questionnaires featuring both closed and open-ended questions focused on management practices, decision-making, financial performance, member satisfaction, and overall cooperative success, complemented by secondary data sources such as literature reviews and theoretical frameworks. Descriptive and inferential statistics, along with multiple regression analysis using SPSS version 24, were applied to examine the relationship between professional managers and cooperative business performance. The results indicated that financial management practices, including budgeting, forecasting, and performance reviews, had a positive impact on financial performance, with a significant portion of respondents, most with 6 to 15 years of experience, affirming that professional managers enhanced profitability, particularly through innovation, with over 62% confirming increased profitability. In this study on the effects of professional managers on cooperative business performance, the relationship between professional management and cash flow was established using structured questionnaires that included items on managerial practices and financial indicators, with data analyzed through statistical methods to determine their correlation. Although primary data were collected via questionnaires, books and scholarly articles were treated as secondary data because they provided previously published information, theories, and empirical evidence that supported the research framework and analysis, helping to contextualize and interpret the findings. A strong positive correlation (R = 0.850) was found between the predictors and business performance, explaining 72.3% of the variance. The study concluded that professional managers significantly enhance cooperative business performance, particularly in financial management, strategic decision-making, and fostering innovation, and emphasized that sustained focus on managerial skills development and innovation is crucial for the xiii continued growth and success of cooperative businesses like the Ambo Farmers' Cooperative Union.