The role of external information sources in organizational innovation in Nigeria

Abstract

Traditionally, the focus of strategic management studies has been on technological innovation. However, recent studies have shown rising importance of non-technological innovation to firms’ productivity, especially in developing country contexts. One limitation in empirical firm innovation analyses this study attempts to resolve, is the role of information sources in driving non-technological (organizational) innovation in a developing country context. Developing countries rely on knowledge from external sources to make up for their deficiencies in R&D capability to drive their innovation efforts. Using pooled, cross-sectional data from two rounds of Nigeria’s Innovation Surveys, this study assesses the role of external information sources in organizational innovation practices in Nigeria. A comparative analysis of the manufacturing and service sectors was also undertaken. Using a multivariate probit analysis, our results provide strong evidence of heterogeneity in firms’ information sources used in implementing organizational innovation practices in Nigeria. Most information sources which drive organizational innovation practices in manufacturing firms do not have an impact on service firms. The study recommends sector-specific polices to drive organizational innovation in developing countries.