Effect of Innovative Strategies on the Performance of Small and Medium Enterprises in Nairobi County, Kenya


  • Evans Timothy Bundi Kithinji KCA University
  • Dr. Nyaribo Misuko KCA University




In a progressively challenging environment, innovation is extensively considered as the most vital source of competitiveness, because it creates a constant improvement that assists the organizations to endure. Innovation also leads to product and process enhancements thus enhancing efficiency. Innovation is often a necessity for organizations with strictly limited funds and resources yet are trying to remain profitable and competitive. Therefore, this study sought to establish the influence innovation strategies on performance of small and medium enterprises in Nairobi City County. The specific objectives were to determine the effect of product innovation, service innovation, marketing innovation and process innovation on organizational performance in SMEs. The study used a descriptive research design. A total of 398 Small and Medium Enterprises was used where the enterprise owners was used as the respondents. Primary data was collected through the administration of the questionnaires. Descriptive and inferential statistics analysis was conducted. A regression model was used to determine the effect of innovation strategies on performance of Small and Medium Enterprises in Nairobi County. The regression of coefficients results show that product innovation and organizational performance of SMEs is positively and significantly related. The results further indicated that service innovation and organizational performance of SMEs is positively and significantly related. The results further indicated that marketing innovation and organizational performance of SMEs is positively and significantly related. Lastly, results showed that process innovation and organizational performance of SMEs is positively and significantly related. The study concluded that innovation strategies positively influences performance of SMEs in Kenya. The study recommends that the SMEs should invest in innovative technology to survive intense competition currently experienced in the SMEs. Further, the study recommends that the SMEs should continuously produce new products and re-engineer existing products to prolong the product life cycle. Further, the study recommends that the SMEs should design an innovative marketing strategy that makes customers feel a part of the enterprise through social responsibility and promotions. The study recommended that the SMEs should invest in benchmarking with the technology in the industry.

Keywords: Product Innovation, Service Innovation, Marketing Innovation, Process Innovation & Small and Medium Enterprises.

Author Biographies

Evans Timothy Bundi Kithinji, KCA University

Postgraduate Student, KCA University

Dr. Nyaribo Misuko, KCA University

Lecturer, KCA University


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How to Cite

Kithinji, E. T. B., & Misuko, N. (2022). Effect of Innovative Strategies on the Performance of Small and Medium Enterprises in Nairobi County, Kenya. Journal of Strategic Management, 6(6), 127–139. https://doi.org/10.53819/81018102t2112