Risk Management in Agricultural Financing in Nigeria

Risk Management in Agricultural Financing in Nigeria


The significance here is discussing suggestions for ways of managing projects that is schemed for using human and material resources to reach a defined objectives – meaning such activities as the ones stated below:

  • Economic development of nation, state and local government on corporation.
  • Research and development of large scale equipment or production.
  • Setting up a new organization.
  • Major overhaul and planned maintenance as with a blast furnace or plant.

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Nationally, this is only a small selection of illustration intended to indicate the general character of the activity.

Features that distinguish projects from enterprise are that they usually:

  • Are transient through complex
  • Have definite start and completion data
  • Require temporary management and organization which may change during phase of the project.
  • Here elements of uncertainty and risks.
  • Are often non-repetitive unlike much of the production
  • Interacts with projects and organizations.

Different meanings have been attributed to the word ‘management’. To some people, it is being they think of management loan or a group individuals in an organization. It is also seen as a process demanding the performance of different professions under an organization. And to a student, management is an academic discipline. And in this instance, people study the art of managing or management science.

According to the American Institute of Management “it is used to designate either a group of functions or the personnel who them out, to describe either an organization’s official hierarchy or the activities of men who compose it to provide antonym to either labour or ownership”.

Management is defined as “getting things done through others”. It can be more scientifically defined a the coordination of all the resources of an organization through the process of planning, organizing, directing and controlling in order to attain organizational objectives. Management is the guidance or direction of people towards organizational goal or objectives, it can also be seen as the supervising, controlling and coordinating of activity to attain optimum results with organizational resources. According to Henry In-Boettenge in his definition he said. ‘Art is the imposition of a pattern, a vision of a whole, and many disparate parts so as to create a representation of that vision art is an imposition of order or chaos. The artist has to have not only the vision that he or she wants which to present the vision. This process entails choosing the correct out form, the correct in a lending of vision and of craft that involves the viewer, reader or listener without requiring that he separates the parts in order to appreciate the whole”.

Here, Henry M. Boettenger is defining management as art which requires technical skill, and conceptual ability. And the artist must possess the know-how in order to be successful or creative.

In the same manner to be a successful manager or top flight executive one has to master the art of managing. In other words, management as art creates the ability and special aptitude to design or erect a desired result.

According to Fredrick W. Taylor, the known father of scientific management use the method of science in making decision and evaluating its consequences science attempts through systematic procedures to establish the relationship between variable and the underlying principles. Management is science when it employs systematic procedure or scientific method to obtain complete information about a problem under consideration and the solution is subjected to rigorous control procedures to ensure the correctness.

Taylor went as far as showing that a good manager must know the concepts and principles of management and how to apply them in unique situations. And that a successful manager blends experience with science in order to achieve a desired result.

As contained in the management definition, it involves certain basic functions which the manager or the entrepreneur has a harness before on effective, take off of the projects. Such functions are as follows:

  1. Planning
  2. Organizing and staff
  3. Supervision
  4. Direction
  5. Control
  6. Coordination
  7. Innovation
  8. Representation

Before an entrepreneur begins to plan, he must have defined the purpose of the enterprise, what contribution expected and the benefit he hopes to derive.

Planning involves determining both long term and short term, and the ability of the owner of a potential agriculturalist to set both long term and short term objectives and determining what methods will be used to achieve them. This is well entailed taking into consideration of all the factors necessary for the set objectives to be achieved.


This is the implementation of an organization plan to achieve a set goal. This management function involves classifying and dividing the work activities of the business into manageable units: like planning, organizing function must be performed continuously because enterprise and economic conditions constantly change, organizing ability is universally accepted as a characteristics of a successful manager.


In this case, there are three important aspects. First, it implies observation, correctly. This means that responsibilities have been assigned to individual and that the subordinates knew the correct way of carrying out the job. Secondly, the training or remedial phase, in this case, if supervision of training process should be absent, there will be no correction of deviation from the laid down enterprise objectives. Thirdly, the up-grading of work by making all improvement general practice. This involves the recognition of sound contributions made by those employed and to complement their good performance.

Supervision deals chiefly with individual, materials, methods and machinery or equipment used by the workers. It is individuals who are the most complicated and difficult to handle. Personality difference emotions and conditions outside effective supervision.


This involves the management in the sense that they are required to attend to special problems that are new and usual of which they understand the employees has knowledge about. As imperative in agricultural investment, it is the habit of the entrepreneur to regard their workers as making use of their initiatives to attend to such problems. This inability creates satisfied productivity.

5        CONTROL:

This requires setting standards or objectives for accomplishment, maintaining current records for comparison with standard set and acting promptly when operations deviate from the set standard on goods established, controls system deals with the measurable granite like money, units, production or sales.

Managerial control require an appraisal of the reason while operative results are different from these planned and intelligent decision at what action is needed. It is common fact that many entrepreneur are ill-equipped for this type of assignment in terms of experience or even the basic academic qualification


Efforts of the members has to be coordinated hence they perform interrelated functions, therefore, what each one does in some way effect the other. Management is always striving however, through supervision, direction, and control to secure maximum coordination of the activities of the enterprise.


Since change is the constant thing need to innovation, management may perform all the previously discussed basic management functions to form a protection but their inability to talk long view of their operation will curtail dynamism and progressive business.

Innovation implies changes that are new to the implementation of an organization and includes the element of risk involved in using the new areas to effect changes, the successful implementation of innovation ideas and all changes irrespective of their virgin and the motivation impetus behind them.


Clifford and Kenneth in their own contribution stated that managers should possess the ability to represent their firms properly as to establish good reputation for the organization.

This could be greatly achieved by the manager interacting cordially with member of their social groups, government officials, the banks or the creditors, the customers and the suppliers. These qualities will go a long way in endearing the company to customers and as well in serving the management well in the minds of the people.


This article was extracted from a Project Research Work Topic


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