O. O. Olamade

What drives innovation? Inferences from an industry-wide survey in Nigeria

This paper seeks to make some contributions to the literature on firm-level innovation in Africa by attempting to identify the significant factors that explain the capability of firms in Nigeria to innovate using the results of an industry-wide study. We focused on the product and process innovation activities of firms between 2003 and 2006 and found differences in the factors that drive them at the firm level. Our results further show that interactions matter more than most innovation-related variables and that the most important actors that influence a firms innovation efforts are its customers and suppliers. We conclude that product and process innovations are not mutually exclusive and that a major key to successful innovation is how and with whom a firm collaborates. The implication of this for firms and policymakers is that an effectively wired innovation system where all stakeholders are active is critical for firm-level innovation capability.

The types and intensity of innovation in developing country SMEs: evidences from a Nigerian subsectoral study

Understanding the types of innovations that SMEs currently undertake, and their commitment to innovation, is especially useful for policy making in developing countries. This paper, therefore, addressed two main questions: What types of innovation occur in SMEs? How intense is innovation in SMEs? We have used empirical information from a census carried out in the Nigerian cable and wire manufacturing industry. Questionnaire and interviews were the primary means of data collection and the data covered the four-year period between 2003 and 2007. We found a high prevalence of organisational innovation and low prevalence of diffusion-based innovation. Innovation intensity was low at 0.114% per capita training investment. Interestingly, our findings revealed that process and marketing innovation accompanied each other. We conclude that SMEs in developing countries are not innovation-inactive and that they would do better if industries are well organised and firms make higher investments in learning and capability build-up.

Environmental scanning strategy of manufacturing companies in southwestern Nigeria

In this paper, we examine the environmental scanning strategy of manufacturing companies in southwestern Nigeria against the background that manufacturing companies in Nigeria exist in a challenging environment characterised by high import dependency, inappropriate policies, lack of transparent governance and weak industrial capabilities. Empirical data was collected with a questionnaire from a sample of 84 manufacturing firms in southwestern Nigeria. It was observed that generally companies in the industry actively engage in systematic gathering, analyses and assimilation of information about the business environment as strategic input into planning. The main objective of firms’ search was to obtain information required to initiate or support strategies for competing in the domestic market. Central among the factors determining the companies’ level of intrusiveness into the environment are companies’ capacity to interpret changes in the environment, available channels of information and quality of information.

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 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.