Determinants And Project Management Mitigating Mechanisms Of Business Formation Distress The Case Of Startups In Addis Ababa

This research claims that the characteristics of business formation stage corresponds with that of projects and thus studies the application of project management as a mitigating mechanism to tackle causes of business distress at the formation stage. Hence, as per its objective the study identifies 21 Internal (managerial/owner causes, firm-based causes), External (microenvironment causes, meso-environment causes and macro-environment causes), Inter-firm business environment determinants which cause business formation distress. 281 owners/managers of distressed startups in Addis Ababa responded that the identified causes are also responsible for the business formation distress in Addis Ababa. The respondents ranked Lack of adequate Financial and marketing resources, Erratic (inconsistent) supply of inputs, raw materials and equipment, Lack of managerial or technical skill and experience, Political and legal policies of the country, and Lack of adequate working premises (space) as top 5 underlying (root/fundamental) causes of business formation distress in startup projects in Addis Ababa. The research then analyzes the application of the 10 project management knowledge areas by integrating each knowledge area with an identified cause of distress.

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