PROCESS INNOVATION AND CUSTOMER RETENTION OF SMEs IN SELECTED LGAs IN OYO STATE, NIGERIA
Abstract
Small and medium scale enterprises (SMEs) are seeking for ways to improve their performance, satisfy stakeholders and contribute significantly to national growth and development. The issue of process innovation and customer retention has continued to remain a contemporary discourse over time as it has been identified that in order to attain the highest competitive advantage, achieve sustainability and satisfy stakeholders, SMEs must adopt best practices regarding peculiar innovation strategies to positively influence performance. The study investigated the effect of process innovation and customer retention of SMEs in selected Local Government Areas (LGAs) in Oyo State, Nigeria. The study adopted survey research design which focused on SMEs in selected LGAs. The population of the study consisted of owners/managers of SMEs in selected LGAs in Oyo State, Nigeria. The population was 581 SMEs and study adopted total enumeration sampling technique because the population was adequate enough for the study. The study used an adapted questionnaire which was administered to respondents. 413 questionnaires were deemed useable indicating a response rate of 71.1% while the instrument was validated and the data gathered was analyzed using descriptive statistics and simple linear regression analysis. The findings of the study revealed that process innovation have a significant effect on customer retention of SMEs in selected LGAs in Oyo State, Nigeria (Adj. R2 = 0.333, F (1,411) = 453.118, p< 0.05) indicating that process innovation had a positive and significant effect on customer retention of SMEs. The study concluded that innovation management technique particularly process innovation was a catalyst to ensure superior performance among SMEs especially in retaining their customers. The study recommended that owners/managers of SMEs should allocate their firm specific resources and capabilities for continuous performance.
Keywords: Competitive Advantage, Customer Retention, Innovation Management Technique, Performance, Process Innovation, Small and Medium Scale Enterprise, Sustainability.
CITATION: Makinde, O. G., Akinlabi, H. B., & Olujobi I. O. (2021). Process innovation and customer retention of SMEs in selected LGAs in Oyo State, Nigeria. The Strategic Journal of Business & Change Management, 8 (2), 588 – 598.
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DOI: http://dx.doi.org/10.61426/sjbcm.v8i2.2018
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