A CORRELATIONAL STUDY BETWEEN STRATEGIC MANAGEMENTPRACTICES ON SMALL AND MEDUM ENTERPRISES AND THEIRPERFORMANCES IN NIGERIA

Abstract

Small and Medium-sized Enterprises (SMEs) are pivotal to Nigeria’s economic development,
contributing to poverty reduction, job creation, rural advancement, and technological
innovation. The sustained growth of the nation’s economy is therefore closely tied to the
performance of SMEs. Numerous academics have maintained that one of the key elements
influencing SMEs' effectiveness is their use of strategic management strategies. This study
investigates the correlation between strategic management practices and the performance of
SMEs in Nigeria. The positivist investigation paradigm's quantitative methodology served as
the model for this investigation with a customized questionnaire given to Nigerian SMEs'
owners and managers so as to gather data. Using PLS-SEM, three hundred and fifty-four
(354) copies of questionnaire were obtained and examined. The findings reveal that strategy
development, implementation, and evaluation significantly influence SME performance. By
adopting these practices, SMEs can improve market share, sales growth, profitability, and
return on investment. The study provides valuable insights for SME owners, managers,
policymakers, and training institutions, highlighting the importance of strategic management
in enhancing SME performance and driving sustainable economic growth in Nigeria. The
study further recommends that SME owners or managers should invest in strategic planning
and continuous evaluation of business strategies, policy makers can also provide training
programs and incentives to encourage SMEs to adopt strategic management practices.