IDEAS home Printed from https://ideas.repec.org/a/bfy/ojtije/v2y2017i1p15-28id381.html

Effect Of Innovation On The Performance Of Small And Medium Enterprises In Kenya

Author

Listed:
  • Beth Mukiri Kimathi

  • Elegwa Mukulu

  • Romanus Odhiambo

Abstract

Purpose: The focus of the research was to measure the entrepreneurs' innovation and how this attribute contribute to the performance of an SME.Methodology: The study adopted survey research design focusing on a population of 268,100 licensed small and medium enterprises in Nairobi County in Kenya, from which a sample of 400 firms were selected through a multi-stage probability sampling method where stratified sampling method was used first and then simple random sampling from the strata for the 17 constituencies under the Nairobi county. Quantitative data was collected using questionnaires and analyzed using Statistical Package for Social Science (SPSS) and Microsoft Excel. The study tested the research hypothesis on whether innovation had a significant effect on performance of small and medium size enterprises in Kenya.Results: The regression results established that innovation had positive and significant effect of performance of small and medium size enterprises in Kenya. Based on these findings a unit increase in innovations would results to increase in performance of small and medium size enterprises in Kenya. The study also concluded that adoption of latest innovations in product production, process improvement and marketing process differentiated high performing and sustainable SMEs from the rest.Unique contribution to theory, practice and policy: The study recommends that SMEs managers and owners should invest more in e-commerce which include buying or selling through the Internet to reduce the transactions cost and cost associated with keeping inventory.

Suggested Citation

  • Beth Mukiri Kimathi & Elegwa Mukulu & Romanus Odhiambo, 2017. "Effect Of Innovation On The Performance Of Small And Medium Enterprises In Kenya," International Journal of Entrepreneurship, AJPO Journals Limited, vol. 2(1), pages 15-28.
    • Handle: RePEc:bfy:ojtije:v:2:y:2017:i:1:p:15-28:id:381
    as

    Download full text from publisher

    File URL: https://ajpojournals.org/journals/ije/article/view/381
    Download Restriction: Access to full texts is restricted to International Journal of Entrepreneurship
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Victor Oladapo & Godwin Onyeaso, 2012. "An Empirical Investigation Of The Impact Of Luck On Small Business Performance: Dynamic Panel Data Evidence," International Journal of Management and Marketing Research, The Institute for Business and Finance Research, vol. 5(3), pages 29-41.
    2. Kurz, Heinz D., 2008. "Innovations and profits: Schumpeter and the classical heritage," Journal of Economic Behavior & Organization, Elsevier, vol. 67(1), pages 263-278, July.
    3. John Cantwell & Grazia D. Santangelo, 2000. "Capitalism, profits and innovation in the new techno-economic paradigm," Journal of Evolutionary Economics, Springer, vol. 10(1), pages 131-157.
    4. Peter W. Roberts & Raphael Amit, 2003. "The Dynamics of Innovative Activity and Competitive Advantage: The Case of Australian Retail Banking, 1981 to 1995," Organization Science, INFORMS, vol. 14(2), pages 107-122, April.
    5. Jeen Wei Ong & Hishamuddin Bin Ismail, 2012. "Entrepreneurial Traits And Firm Serendipity-Seeking On Smes' Performance: The Effect Of Firm Size," Journal of Enterprising Culture (JEC), World Scientific Publishing Co. Pte. Ltd., vol. 20(03), pages 265-286.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhang, Feng & Jiang, Guohua & Cantwell, John A., 2015. "Subsidiary exploration and the innovative performance of large multinational corporations," International Business Review, Elsevier, vol. 24(2), pages 224-234.
    2. Chang, Yuan-Chieh & Chen, Min-Nan, 2016. "Service regime and innovation clusters: An empirical study from service firms in Taiwan," Research Policy, Elsevier, vol. 45(9), pages 1845-1857.
    3. David Haas, 2015. "Diffusion Dynamics and Creative Destruction in a Simple Classical Model," Metroeconomica, Wiley Blackwell, vol. 66(4), pages 638-660, November.
    4. Mercedes Rubio-Andrés & Santiago Gutiérrez-Broncano & Jorge Linuesa-Langreo & Miguel Ángel Sastre-Castillo, 2025. "Exploring the reality of corporate sustainability strategy and sales performance in entrepreneurial SMEs: the mediating effect of innovation and sustainability performance," International Entrepreneurship and Management Journal, Springer, vol. 21(1), pages 1-34, December.
    5. Rim Zouari‐Hadiji, 2023. "Financial innovation characteristics and banking performance: The mediating effect of risk management," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(2), pages 1214-1227, April.
    6. Heinz D. Kurz, 2011. "The Contributions of Two Eminent Japanese Scholars to the Development of Economic Theory: Michio Morishima and Takashi Negishi," Chapters, in: Heinz D. Kurz & Tamotsu Nishizawa & Keith Tribe (ed.), The Dissemination of Economic Ideas, chapter 13, Edward Elgar Publishing.
    7. Phillips, Duygu & Edwards, Bryan D. & Rutherford, Matthew W., 2025. "Conformity or Differentiation: Optimal distinctiveness through mediating channels," Journal of Business Research, Elsevier, vol. 189(C).
    8. Rajneesh Narula & Andrea Martínez-Noya, 2014. "International R&D Alliances by Firms: Origins and Development," John H Dunning Centre for International Business Discussion Papers jhd-dp2014-06, Henley Business School, University of Reading.
    9. Stefano Elia & Rajneesh Narula & Silvia Massini, 2015. "Disentangling the Role of Modularity and Bandwidth in Entry Mode Choice: The Case of Business Services Offshoring," John H Dunning Centre for International Business Discussion Papers jhd-dp2015-06, Henley Business School, University of Reading.
    10. Godinho, Manuel Mira & Simões, Vítor Corado, 2023. "The Tech Cold War: What can we learn from the most dynamic patent classes?," International Business Review, Elsevier, vol. 32(6).
    11. Adamantia Pateli & Naoum Mylonas & Aggeliki Spyrou, 2020. "Organizational Adoption of Social Media in the Hospitality Industry: An Integrated Approach Based on DIT and TOE Frameworks," Sustainability, MDPI, vol. 12(17), pages 1-20, September.
    12. Hervas-Oliver, Jose-Luis & Sempere-Ripoll, Francisca, 2015. "Disentangling the influence of technological process and product innovations," Journal of Business Research, Elsevier, vol. 68(1), pages 109-118.
    13. Luning Shao & Jianxin You & Tao Xu & Yilei Shao, 2020. "Non-Parametric Model for Evaluating the Performance of Chinese Commercial Banks’ Product Innovation," Sustainability, MDPI, vol. 12(4), pages 1-15, February.
    14. Vossen, Alexander & Ihl, Christoph, 2020. "More than words! How narrative anchoring and enrichment help to balance differentiation and conformity of entrepreneurial products," Journal of Business Venturing, Elsevier, vol. 35(6).
    15. Diaz-Di­az, Nieves Lidia & Aguiar-Di­az, Inmaculada & De Saá-Pérez, Petra, 2008. "The effect of technological knowledge assets on performance: The innovative choice in Spanish firms," Research Policy, Elsevier, vol. 37(9), pages 1515-1529, October.
    16. Tarziján, Jorge & Brahm, Francisco & Daiber, Luis Felipe, 2008. "Entrepreneurial profitability and persistence: Chile versus the U.S.A," Journal of Business Research, Elsevier, vol. 61(6), pages 599-608, June.
    17. Turner, Karynne L. & Monti, Alberto & Annosi, Maria Carmela, 2021. "Disentangling the effects of organizational controls on innovation," European Management Journal, Elsevier, vol. 39(1), pages 57-69.
    18. Rinaldo Evangelista, 2018. "Technology and Economic Development: The Schumpeterian Legacy," Review of Radical Political Economics, Union for Radical Political Economics, vol. 50(1), pages 136-153, March.
    19. Quoc Hoang Thai & Khuong Ngoc Mai, 2024. "Entrepreneurial traits: a systematic literature review," Management Review Quarterly, Springer, vol. 74(4), pages 2717-2785, December.
    20. Samuel Afriyie & Jianguo Duo & Kingsley Appiah & Abdul-Aziz Ibn Musah, 2018. "The Nexus between Types of Innovation and Marketing Performance of SME in an Emerging Economy," International Review of Management and Marketing, Econjournals, vol. 8(6), pages 78-92.

    More about this item

    Keywords

    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bfy:ojtije:v:2:y:2017:i:1:p:15-28:id:381. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chief Editor (email available below). General contact details of provider: https://ajpojournals.org/journals/ije/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.