Examining the Influence of Strategic Orientation on the Performance of Small and Medium Enterprises in Nigeria

Abstract

This study examines the impact of Entrepreneurial Orientation (EO), Market Orientation (MO), and Learning Orientation (LO) on SME performance in Northern Nigeria, with a focus on the mediating role of innovation capability and the moderating effect of government institutional support. Despite SMEs’ vital contribution to Nigeria’s economy, the interaction between internal capabilities and external support remains underexplored, particularly in the region’s unique socioeconomic and cultural context. Anchored in the Resource-Based View (RBV) and Institutional Theory, the study offers insights into enhancing SME resilience and competitiveness in resource-constrained environments. A quantitative, cross-sectional research design was employed, collecting data online from 406 SMEs using stratified sampling. PLS-SEM 4 was used for data analysis. Findings confirm that EO, MO, and LO significantly influence SME performance, with innovation capability acting as a mediator. Government institutional support moderates the EO-performance relationship but does not affect MO and LO relationships. The study emphasizes the importance of maintaining strategic orientations to improve SME outcomes.This study provides a novel examination of SME performance in Northern Nigeria by integrating RBV and Institutional Theory, this research contributes to SME literature by examining the interaction between internal strategies and external enablers. It underscores the role of government support in fostering entrepreneurial success and provides policymakers with actionable recommendations to enhance SME competitiveness. By bridging theoretical and practical perspectives, the study presents a comprehensive framework for understanding SME growth in resource-constrained settings.