Innovation in Nigerian Small and Medium Enterprises: Types and Impact

This article seeks to explore the types of innovation that are predominant in SMEs in developing countries and to investigate the impact of these innovations on different dimensions of firm performance based on an industry-wide innovation survey carried out in Nigeria in 2007. Although innovation is...

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Bibliographic Details
Published in:Journal of electronic commerce in organizations 2009-10, Vol.7 (4), p.40-51
Main Authors: Egbetokun, A.A, Olamade, O.O
Format: Article
Language:English
Subjects:
Business performance management
Developing countries
Domestic
Domestic markets
Electronic commerce
Exports
Innovations
International trade
LDCs
Markets
Organizational performance
Organizations
Product development
Small & medium sized enterprises-SME
Small and medium sized companies
Small business
Strategy
Surveys
Technological innovations
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Summary:This article seeks to explore the types of innovation that are predominant in SMEs in developing countries and to investigate the impact of these innovations on different dimensions of firm performance based on an industry-wide innovation survey carried out in Nigeria in 2007. Although innovation is important for superior firm performance, our result found that the type of innovation that SMEs pursue is not a critical consideration in their performance. While there was no difference found in the focus of SMEs on either of product or process innovations, evidence showed that SMEs would focus more on incremental product and process innovations. Incremental innovation was found to be very important for Nigerian SMEs and a significant predictor of product quality and not of revenue. The authors conclude that SMEs chooses to pursue such innovations that most fit their strategies and available resources. Such level of innovation affords Nigerian SMEs to more extensively exploit the domestic market but cannot support extensive new product development required to enter export markets.
ISSN:1539-2937
1539-2929
DOI:10.4018/jeco.2009100104