Effect of Organizational Capability on Firms Growth: Implications on SMEs in Anambra State, Nigeria

Abstract

Organizational capabilities are seen as the firm context in which the organization members work in order to contribute to growth of the firm. Thus, inadequate organizational capabilities have resulted to numerous problems for many Small and Medium Enterprises (SMEs) with growing difficulties in their ability to perform and attain sustainable growth. Numerous researches relating to organizational capabilities and firm’s growth have been conducted in the literature but none of these have examined the implications of organizational capability on firm’s growth. This research therefore examined the implications of organizational capability on firm’s growth, its implications of SMEs in Anambra State. The research employed a descriptive research design. The study population was one hundred and fifty-two business owners and managers of selected SMEs in Anambra State. Complete enumeration was used. Primary data was used and was collected using questionnaires. The questionnaire was validated using face and content validity. Reliability of the instrument was done with Cronbach Alpha indicates high internal consistency. Data collected was analyzed using correlation analysis. Findings from the study indicated that research and development capability have no significant positive relationship on firm’s growth, while human resource capability has a significant positive relationship on firm’s growth. The study concluded that organizational capabilities are key success factor for driving firm’s growth among SMEs in Anambra State, Nigeria. The study recommended that for SMEs to achieve sustainable growth, business owners and managers should increase their degree of firm’s interaction with the environment and add more value to human resources capability.