Firms Innovativeness and Performance in Nigerian Industrial Estates

Adegbite Stephen, Aderemi Helen, Sobanke Victor, Amiolemen Sunday, Babalola Olutunde


This paper examined the nature of firms’ innovativeness and business performance of manufacturing firms in industrial estates located in Lagos State, Southwestern Nigeria. Data for the study were collected through questionnaire and unstructured interview which elicited information on types of innovation; intensity of innovation; factors influencing innovation; and their effect on business performance. The result revealed that food and beverages (29.3%), metal fabrication (17.1%), chemical/chemical products (12.2%), and rubber/plastic products (12.2%) were the predominant industrial sectors at the estates. The study further showed that 78.0% of the firms carried out innovation activities while 73.2% reported successful innovations. In addition, 41.5% of the innovations were based on internal efforts while external factors accounted for 7.3%. Similarly, 26.8% of responding firms engaged in occasional innovations while a few (19.5%) adopted continuous innovation strategy. Effect of innovation strategy on business performance revealed a significant positive relationship between the average sales turnover of firms and process innovation (r = 0.518; p<0.05) while variables such as product innovations (r = -0.046; p>0.05), organizational innovation (r = -0.213; p>0.05), and marketing innovation (r = -0.069; p>0.05) had no significant relationship with the firms’ performance. The study concluded that business performance could be more enhanced through improved operational efficiency, linkages with R&D institutions and acquisition of appropriate technical skills.

Keywords: Innovations, manufacturing firms, industrial estates, business performance

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