Nigeria's SMEs and innovative product development: Challenges and opportunities in the 21st century (original) (raw)
Related papers
Nigeria's sMes aNd iNNOvative PrOduct develOPMeNt
2012
Globalization has changed the way firms, industries contend with competition, and for any country to be relevant in this 21 st century, there is a need for a paradigm shift in the way governance and businesses are conducted. It is against this backdrop that many emerging
Small and Medium Scale Enterprises (SMEs): A Catalyst in Promoting Economic Development in Nigeria
This research paper has specifically x-rayed the concept of Small and Medium Scale Enterprises (SMEs) and it was defined as a business which is owned, led by one or a few persons, with direct owner(s) influence in decision making, and having a relatively small share of the market and relatively low capital requirement. The contributions of SMEs to the economy were examined in this paper. The problems confronting SMEs and the possible strategies of combating the problems were also examined. A conceptual framework was developed by the authors and it explains/illustrates the series of variables that are integral in the area of SMEs and the effects it can possibly have on the economy. The concept of Economic Development was briefly described. A section was devoted to examining the roles of SMEs for economic Development in Nigeria. One of the major recommendations advanced in this paper was that the Government should urgently invest massively in improving the current infrastructural base in the country. 1.0. Introduction The national economy has remained a focal point in recent debates owing to the rising level of unemployment, poverty, insecurity, low productivity, human capital flight/brain drain. The need to advancing the socioeconomic , political and technological growth of any nation relies heavily on the creativity and technical ingenuity of the players/actors in that economy in transforming the available resources into productive use. It has been stressed by scholars that Small and Medium Scale Enterprises (SMEs) is a driving force in developing and developed nations alike. The emphases on SMEs remain a recurring decimal in the lexicon of Nigeria and this is not unconnected with the realization of the roles of SMEs in job creation, poverty alleviation and foreign exchange conservation (Jimah, 2011; Ikherehon, 2002; Akingunola, 2011). Agu (2001) defined SMEs as a business which is owned, led by one or a few persons, with direct owner(s) influence in decision making, and having a relatively small share of the market and relatively low capital requirement. The earliest manifestations of SMEs in advanced countries were coltage industries that later transformed into industrial complexes and tech factories. SMEs today account for the bulk of output in most countries today. It is also a proven job creator: the share of SMEs in global productivity is over 30% higher in some countries, but generally growing. In China, SMEs employ over 50% of the workforce while in the United States (US), SMEs account for over 50% of Gross Domestic Product (Ehinomen & Adeleke, 2012). In Nigeria, SMEs employ over 60% of the labour force both in formal and informal sectors. The need to have a regulatory body to control the activities of SMEs in the country led to the formation of Small and Medium Enterprises Development Agency of Nigeria (SMEDEN) in 2004 by an act of parliament towards the realization of the goals and objectives of SMEs. There is no doubt that SMEs play significant roles in the advancement and development of the economy. Some of these roles which have been briefly identified above remain integral to the progress of the nation. For these roles to be fully realized there is need for our educational system to fully be repositioned with the aim of accelerating the growth and development of SMEs. The establishment and management of SMEs no doubt have numerous implications on the economic development of the nation as documented by scholars in the field. The term Economic development has been defined by various scholars in different ways. According to Misra and Puri (2003), economic development means growth plus progressive changes in certain critical variables that determine the well-being of the people. They assert that there are qualitative dimensions in the development process which may be missing in the growth of a given economy expressed in terms of an increase in the national product or the product per capita. From the foregoing, it becomes obvious that economic development is far beyond the numerical growth in a nation's income which politicians often express to draw the attention of unsuspecting electorates. This growth or changes must cut across all the sectors of the economy and must be felt in the living standard of the citizens and this is what SMEs seeks to bring to reality.
Twintech Business School Review Malaysia, 2011
The paper notes that an action which needs to be taken over ten years for proper foundation to be laid, if rushed in two years will still be defective and inste a good result will more than escalate the problem. This is the true picture of Nigeria. It is contended that Nigeria is supposed to have joined the league of industrialized nations by now, but the fact remains that successive governments since independence did not give adequate attention to applying the right medication to the ailing economy. This pap examines the poverty situation in Nigeria. There is a focus on theoretical background with particular emphasis on defining the Small and medium Enterprises (SMEs). Effort is made in this paper to expose the economic development potentialities of small a medium scale enterprises It is noted that SMEs have, and are still performing the magic in the Asian countries like Taiwan China, Singapore Koreo and other South countries, and presently these countries are forces to reckon with in the world efforts of the past and present administrations were examined and reasons why the steps taken did not catapult the country forward economically were equally highlighted with recommendations on how the SMEs could serve as catalyst to economic dev Nigeria A model for actualizing the recommendation is presented The paper concluded on the note that the future development of Nigeria rests on effective promotion of the SMEs.
Innovation in Nigerian SMEs: types and impact
2008
This paper 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. We 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.
Innovation in Nigerian Small and Medium Enterprises
Journal of Electronic Commerce in Organizations, 2000
This paper 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. We 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.
SME FIRM PERFORMANCE IN NIGERIA: LESSON FROM MALAYSIA
2014
Purpose performance through the blend of technology expertise and entrepreneurial skills in Malaysia and Nigeria. They fall within the paradigm of developing countries seeking for greater economic competitiveness in a global business environment. Both have developed framework policies and implemented strategic plans for the growth of small and medium scale enterprises (SMEs) as an essential component of economic development, employment creation and economic transformation towards becoming a developed nation by the year 2020. Malaysia through SMEs performance has moved from efficiency-driven to innovation-driven economy through effective mechanisms. While Nigeria SMEs performance is still facing tremendous challenges and threats in achieving economic transformation, despite the strategic policies, institutional framework sets as a priority by the Nigerian government in ensuring SMEs performance. This paper focuses on how Nigeria can learn from Malaysia experience in enhancing SMEs performance for economic transformation. Design/methodology/approach This is essentially a general review paper using a descriptive method on technological programs that have been put through for economic transformation. The paper also reviews governmental programs that enhance the Malaysian SMEs performance on skilled human resources via SME-University collaboration in order to make an innovative generation. Findings Following assessment, Nigeria can learn from Malaysia experience by duplicating SME performance success of Malaysia towards economic transformation, moving from efficiency-driven to innovation-driven economy through coordination of efficient mechanisms by advancing innovation culture and improving the business environment Originality/value Nigeria can duplicate the Malaysia performance and development success, in achieving his economic blueprints of vision 20: 2020.This will be proposed as a guide for policy makers in Nigeria and for the people in charge of the national program of small and medium enterprises in
Exploring the Challenges of SMEs in Emerging Economies: a case study of Nigeria
Small and medium enterprises (SMEs) perform an important financial responsibility, considerably in emerging economies. SME is the single biggest participator to job and employment creation, and they consider a considerable part of GDP in this world. However, lack of access to finance keeps the most entrenched barrier to growth of organizations. SMEs are normally very small to attract commercial investor or bank interest and very large to been fit from microfinance products. At present, some solutions to encourage this “missing middle” of businesses have been capable to fill the funding gap in a globally scalable approach. The purpose of this research is to observe the challenges facing small-scale businesses in Nigeria and make recommendations that will support in solving some of these issues and increase the contribution of small Nigerian companies in the global context. This research also defines opportunities for profitability and growth in the global context for these companies. Considering the difficulties and challenges encountered through SMEs in Nigeria will be essential if Nigerian government is to come up with strategies, which will evade their small businesses from being swept away by fast modifications taking position in the current global financial system. This research aimed to explore the challenges for SMEs in emerging economies: A case study of Nigeria.
Innovation in Nigerian Small and Medium Enterprises: types and impact
2008
This paper 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. We 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.
Strategic Importance of the Nigerian Small and Medium Enterprises (SMES): Myth or Reality
American Journal of Business Economics and Management, 2014
This paper explores the empirical significance of the Nigerian SMEs on economic development. A survey of SME operators in Lagos State, Nigeria was undertaken by means of self-administered questionnaire and interview schedules. Stratified sampling technique was used to select samples from the state directory compiled by the Ministry of Commerce and Industry in 2013. The interview schedule was used to generate information for the development of three case studies. Data were analyzed by means of descriptive statistics, Pearson Product Moment Correlation and Regression analysis. The findings of the study revealed that participating responding firms made significant contributions to the Nigerian economy; also there exists significant correlations among the study variables and significant causal relationship between organizational characteristics and their perceptions on contributions to the Nigeria economy. The practical implication is that Nigerian SMEs have made the desired impact like their contemporaries in the developed economies. Therefore, well-articulated SME programmes, simplified operating rules, enabling environment, collaboration, financial incentives, cluster formation and capacity building are suggested for Nigerian SMEs to make more impactful contributions to industrial and technological development.