Aligning Small and Medium Enterprises for Competitiveness in Nigeria:The Role of Strategic Alliance

Abstract

Businesses all over the world face competition and competitors have a major bearing on business performance. This study seeks to ascertain the role strategic alliance play in making small and medium enterprises achieve competitiveness. The study which employed the survey design covered six zones of Nigeria. The target population was all small and medium enterprises owners and their workers operating in the zones. These businesses are seen clustering in the major commercial cities of each zone and for each zone; three commercial cities were judgementally selected. Since their population was known and it was not possible to study the entire business that fall into this category, the sample size was determined using Taro Yamane formula. The instrument for data collection was the questionnaire, structured in a 5 point likert type scale. Reliability of the instrument was established. The questionnaire was administered to the respondents. Presentation and analysis of the data was carried out using frequency tables and simple percentages. The Pearson Product Moment Correlation was used for testing the formulated hypotheses aided by the Statistical Package for Social Sciences (SPSS) version 20.0. Findings show that: Combination of financial, material and human resources make small and medium enterprises develop competitive edge. Distribution of risk and reward makes small and medium enterprises build capacity to compete. This is to say; formation of alliance makes small and medium enterprises develop competitive ability. It is recommended that small and medium enterprises should form alliance in order to pool together financial, material and human resources with the sole aim of developing strong competitive ability which every business needs today for survival. As well, they need to distribute their risk in form of diversification across different industries and/or product lines, guide the alliance organization; watch their strategy implementation and culture of their allies.