Impact of Electricity Service Quality on the Performance of Manufacturing SMEs in Nigeria
Abstract
Purpose: The objective of this paper is to determine the impact of electricity service quality on both financial and non-financial performance of manufacturing Small and Medium Enterprises SMEs in Nigeria.
Design/Methodology/Approach: Survey questionnaire was used to collect data from 201 Managers, Chief executive officers and owner managers of SMEs that are members of Manufacturers Association of Nigeria MAN. Simple regression analysis was done with the use of SPSS version 22.0.
Findings: The results indicate that quality of electricity tends to account for more than 50% of the variances in the financial and non-financial performance of manufacturing SMEs in Nigeria.
Implications/Originality/Value: This paper contributes to the existing literature on the empirical investigation into the use of service quality as a measure of electricity service and also emphasizes the importance of electricity to the performance of manufacturing SMEs in the developing countries. It recommends that future research may consider collecting longitudinal data to eliminate bias related to time.
Downloads
Article Analytics Summary
References
Adenikinju, A. (2005). Analysis of the cost of infrastructure failures in a developing economy : The case of the electricity sector in Nigeria (148). Ibadan, Nigeria.
Akuru, U. B., & Okoro, O. I. (2014). Economic Implications of Constant Power Outages on SMEs in Nigeria. Journal of Ener, 25(3), 61–66. http://doi.org/10.2139/ssrn.1968275 DOI: https://doi.org/10.17159/2413-3051/2014/v25i3a2658
Aliyu, S. A., Ramli, A. T., & Saleh, M. A. (2013). Nigeria electricity crisis : Power generation capacity expansion and environmental ramifications. Energy, 61, 354–367. http://doi.org/10.1016/j.energy.2013.09.011 DOI: https://doi.org/10.1016/j.energy.2013.09.011
Armstrong, J. S., & Overton, T. S. (1977). Estimating Nonresponse Bias in Mail Surveys. Journal of Marketing Research, 14(3), 396–402. http://doi.org/10.2307/3150783 DOI: https://doi.org/10.1177/002224377701400320
Ayanda, M., & Adeyemi, S. L. (2011). Small and Medium Scale Enterprises as A Survival Strategy for Employment Generation in Nigeria. Journal of Sustainable Development, 4(1), 200–206. http://doi.org/http://www.ijrcm.org.in/cem/index.php DOI: https://doi.org/10.5539/jsd.v4n1p200
Braimah, I., & Amponsah, O. (2012). Causes and Effects of Frequent and Unannounced Electricity Blackouts on the Operations of Micro and Small Scale Industries in Kumasi. Journal of Sustainable Development, 5(2). http://doi.org/10.5539/jsd.v5n2p17 DOI: https://doi.org/10.5539/jsd.v5n2p17
Brody, L., Mandelkern, M. A., Jarvik, M. E., Lee, G. S., Smith, E. C., Huang, J. C., … London, E. D. (2004). Differences between smokers and nonsmokers in regional gray matter volumes and densities. Biol. Psychiatry, 55(1), 77–84. http://doi.org/10.1016/S0006-3223(03)00610-3 DOI: https://doi.org/10.1016/S0006-3223(03)00610-3
CIA. (2017). The World Fact Book: Guides to country profiles. Retrieved from https://www.cia.gov/library/publications/resources/the-world-factbook/geos/ni.html
Datta, S. (2012). The impact of improved highways on Indian firms. Journal of Development Economics, 99(1), 46–57. http://doi.org/10.1016/j.jdeveco.2011.08.005 DOI: https://doi.org/10.1016/j.jdeveco.2011.08.005
Doe, F., & Asamoah, E. S. (2014). The Effect of Electric Power Fluctuations on the Profitability and Competitiveness of SMEs : A Study of SMEs within the Accra Business District of Ghana. Journal of Competitiveness, 6(3), 32–48. http://doi.org/10.7441/joc.2014.03.03 DOI: https://doi.org/10.7441/joc.2014.03.03
Elebeke, E. (2012, December 14). SMEs contribute half of Nigeria’s GDP. Vanguard. Lagos, Nigeria. Retrieved from http://www.vanguardngr.com/2012/12/smes-contribute-half-of-nigerias-gdp/
Forkuoh, S. K., & Li, Y. (2015). Electricity Power Insecurity and SMEs Growth: A Case Study of the Cold Store Operators in the Asafo Market Area of the Kumasi Metro in Ghana. Open Journal of Business and Management, 3(July), 312–325. http://doi.org/http://dx.doi.org/10.4236/ojbm.2015.33031 DOI: https://doi.org/10.4236/ojbm.2015.33031
Fumagalli, E., Garrone, P., & Grilli, L. (2007). Service quality in the electricity industry: The role of privatization and managerial behavior. Energy Policy, 35(12), 6212–6224. http://doi.org/10.1016/j.enpol.2007.07.019 DOI: https://doi.org/10.1016/j.enpol.2007.07.019
Gado, N. D., & Nmadu, T. M. (2012). The Performance of Textile Companies in the North West Zone of Nigeria: the Role of Infrastructure as a Resource. International Journal of Human Resource Studies, 2(1), 89–100. http://doi.org/10.5296/ijhrs.v2i1.1259 DOI: https://doi.org/10.5296/ijhrs.v2i1.1259
Hensher, D. A., Shore, N., & Train, K. (2014). Willingness to pay for residential electricity supply quality and reliability. Applied Energy, 115, 280–292. http://doi.org/10.1016/j.apenergy.2013.11.007 DOI: https://doi.org/10.1016/j.apenergy.2013.11.007
Kang, G.-D., & James, J. (2004). Service quality dimensions: an examination of Grönroos’s service quality model. Managing Service Quality, 14(4), 266–277. http://doi.org/10.1108/09604520410546806 DOI: https://doi.org/10.1108/09604520410546806
Keskin, H., Senturk, C., Sungurt, O., & Kiris, H. (2010). The Importance of SMEs in Developing Economies Definition of Small and Medium-Sized Enterprises ( SMEs ). 2nd International Symposium on Sustainable Developement, 183–192.
Krishnakumar, K., & Baby, P. (2012). Role of Responsiveness Factor in Enhancing Domestic Airlines Service Quality. Indian Journal of Applied Research, 2(October), 28–33. DOI: https://doi.org/10.15373/2249555X/OCT2012/11
Lenz, R. T. (1980). Environment , Strategy , Organization Structure and Performance : Patterns in One Industry. Strategic Management Journal, 1, 209–226. DOI: https://doi.org/10.1002/smj.4250010303
MAN. (2014). Nigeria Industrial Diretory. Lagos, Nigeria.
Moon, Y. J. (2013). The tangibility and intangibility of e-service quality. International Journal of Smart Home, 7(5), 91–102. http://doi.org/10.14257/ijsh.2013.7.5.10 DOI: https://doi.org/10.14257/ijsh.2013.7.5.10
Morgan, N. a, & Rego, L. L. (2009). Brand Portfolio Strategy and Firm Performance. Journal of Marketing, 73(1), 59–74. http://doi.org/10.1509/jmkg.73.1.59 DOI: https://doi.org/10.1509/jmkg.73.1.59
Nandakumar, M. K., Ghobadian, A., & O’Regan, N. (2010). Business-level strategy and performance: The moderating effects of environment and structure. Management Decision, 48(6), 907–939. http://doi.org/10.1108/00251741011053460 DOI: https://doi.org/10.1108/00251741011053460
Noor, S. M., & Nasirun, N. (2013). Service Quality and Customer Satisfaction in a Natural Monopoly Company. Colloquium on Administrative Science & Technology, 308–311. DOI: https://doi.org/10.1007/978-981-4585-45-3_7
OECD. (2005). OECD SME and Entrepreneurship outlook. France.
Oginni, B. O., & Adesanya, A. S. (2013). Business environmental Factors: Implications on the survival and growth of business organisations in the manufacturing sector of Lagos metropolis. Business and Management Research, 2(3). http://doi.org/10.5430/bmr.v2n3p146 DOI: https://doi.org/10.5430/bmr.v2n3p146
Olayemi, S. O. (2012). Electricity Crisis and Manufacturing Productivity in Nigeria. Developing Country Studies, 2(4), 16–21.
Osotimehin, K.O., Jegede, Charles. A, Akinlabi, Babatunde. H, Olajide, O. T. (2012). An Evaluation of the Challenges and Prospects of Micro and Small Scale Enterprises Development in Nigeria Department of Business Administration and Management Technology Lagos State University External System. American International Journal of Contemporary Research, 2(4), 174–185.
Pallant, J. (2011). SPSS Survival Manual: A step by step guide to data analysis using the SPSS program (Fourth). Autralia: ALLEN & UNWIN.
Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1994). Alternative Scales for Measuring Service Quality- A Comparative Assessment Based on Psychometric and Diagnostic Criteria. Journal of Retailing, 70(3), 201–230. DOI: https://doi.org/10.1016/0022-4359(94)90033-7
Rud, J. P. (2012). Infrastructure regulation and reallocations within industry: Theory and evidence from Indian firms. Journal of Development Economics, 99(1), 116–127. http://doi.org/10.1016/j.jdeveco.2011.10.001 DOI: https://doi.org/10.1016/j.jdeveco.2011.10.001
Saleh, A. S., & Ndubisi, N. O. (2006). An Evaluation of SME Development in Malaysia. International Review of Business Research Papers., 2(1), 1–14.
Satapathy, S. (2014). An analysis for service quality enhancement in electricity utilitysector of India by SEM. Benchmarking: An International Journal, 21(6), 964–986. DOI: https://doi.org/10.1108/BIJ-10-2012-0071
Selvam, M., Gayathri, J., Vasanth, Vinayagamoorthi Lingaraja, K., & Marxiaoli, S. (2016). Determinants of Firm Performance: A Subjective Model. International Journal of Social Science Studies, 4(7), 90–100. http://doi.org/10.11114/ijsss.v4i7.1662 DOI: https://doi.org/10.11114/ijsss.v4i7.1662
Sherazi, S. K., Iqbal, M. Z., & Asif, M. (2013). Obstacles to Small and Medium Enterprises in Pakistan . Principal Component Analysis Approach. Middle-East Journal of Scientific Research, 13(10), 1325–1334. http://doi.org/10.5829/idosi.mejsr.2013.13.10.1186
SMEDAN. (2013). SMEDAN and National Bureau of statistics collaborative survey: Selected findings. ABUJA, NIGERIA.
Striteska, M., & Spickova, M. (2012). Review and Comparison of Performance Measurement Systems. Journal of Organisational Management Studies, 2012, 1–13. http://doi.org/10.5171/2012.114900 DOI: https://doi.org/10.5171/2012.114900
WorldBank. (2017). Industry, value added (annual % growth) World Bank national accounts data, and OECD National Accounts data files. Retrieved from http://data.worldbank.org/indicator/NV.IND.TOTL.KD.ZG
CSRC Publishing and JBSEE adhere to Creative Commons Attribution-Non Commercial 4.0 International License. The authors submitting and publishing in JBSEE agree to the copyright policy under creative common license 4.0 (Attribution-Non Commercial 4.0 International). Under this license, the authors published in JBSEE retain the copyright including publishing rights of their scholarly work and agree to let others remix, tweak, and build upon their work non-commercially. All other authors using the content of SBSEE are required to cite author(s) and publisher in their work. CSRC Publishing and JBSEE follow an Open Access Policy for copyright and licensing.
