THE EFFECTS OF FIRM STRATEGIC FACTORS ON MANUFACTURING COMPANIES’ PERFORMANCE: EVIDENCE FROM NIGERIA.
The debate over which of firm strategic factors or market structure variables dominates strategy choices and performance differentials in Nigeria has not been systematically investigated. Against the backdrop of declining manufacturing performance in Nigeria, this study examined the effects of selected firm strategic factors on the returns on invested capital of a sample of 30 quoted manufacturing firms spread over eight industrial sectors in Nigeria. Panel regression model was designed and used in analyzing the 150 secondary data generated for the study (i.e. comprising a five-year time span). A key finding of the study was that firm strategic factors in the study i.e. size, age and capital intensity were heterogeneous and related differently to returns on Invested capital (performance parameter). Size had a positive effect on returns on invested capital while age and capital intensity had negative effects respectively. The study concluded that firm strategic factors influenced returns on invested capital differently for manufacturing firms. It was therefore recommended that managers’ capability to leverage firm strategic factors should be emphasized to boost the strategic performance of Nigerian manufacturing sector as medium for economic growth and job creation in the country.
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