Diversification Strategy and the Survival of Manufacturing Firms in Anambra State, Nigeria

Abstract

The Manufacturing sub-sector has played significant role to the Nigerian economy however; its survival largely depends on the extent of diversification strategies adopted by these firms. This study titled Diversification Strategy and Survival of Manufacturing Firms in Anambra State is written to examine the extent in which diversification strategy enhances survival of Manufacturing Firms in Anambra State, Nigeria. More so, the research was anchored on Resource Based View theory. The population of the study was 1300 employees cutting across Nigeria Brewery plc 910 and Innoson 290 however, considering the size of the population a sample size of 295 was determine using the Godden sample size statistical formula through a 18 items structured questionnaire but only 242 respondents completed and returned their questionnaire given 82% retrieval rate. Pilot study was carried out using a test re-test method and Cronbach alpha coefficient to establish the reliability of the research instrument. Validity of the research instrument was conducted using content and face methods moderated by three experts. In addition, research survey design was adopted, and the statistical tools utilized comprised descriptive and parametric statistics while the three hypotheses were tested using simple linear regression analysis. Findings revealed that there was a significant positive relationship between horizontal diversification and adaptability (r = 896, p-value <0.05), there was a significant positive relationship between vertical diversification and innovation (r = .916, p-value <0.05) and there was a significant positive relationship between concentric diversification and cost optimization (r =.874. In view of the findings, the study concluded that there was a significant positive relationship between diversification strategy and survival of manufacturing firms in Anambra State. Premised on the findings, the study recommends that the Firms should consistently maximize their strategic capacities to attain improved performance and firms should consciously adopt innovative strategies with the view to averting product decline so that customers satisfaction would not only be sustainably attained but be improved upon.