Business Strategies and Firm Profitability of Selected Mobile Operating Firms in Nigeria

Abstract

Purpose: Firms economic and financial growth are the major goals of organizations across the globe to beat competition and survive in the unfriendly business environment. However, despite the positive impact of the mobile telecommunication sector to social and economic development, the mobile operating firms are plagued with challenges militating against the expected growth rate. This is evident in decline in market growth, dwindling profitability and decline in productivity. This study examined business strategies and firm profitability of mobile operating firms in Nigeria.
 Methodology: The study adopted survey research design. The population of the study was 436 management staff of the selected mobile operating firms in Nigeria. The enumeration sampling method was used. A structured adapted and validated questionnaire was administered. Cronbach’s alpha reliability coefficients for the constructs ranged from 0.71- 0.79. The response rate was 83.3%. Data were analyzed using descriptive and inferential (multiple regression) statistics.
 Findings: The study revealed business strategies have significant effect on profitability (Adj. R2 = 0.469; F (4, 358) = 81.082, P < 0.05). The study concluded that business strategies (cost leadership, product differentiation, product leadership and service delivery) influenced market growth, firm profitability and productivity of selected mobile operating firms in Nigeria.
 Recommendation: The study recommended that for mobile operator’s companies to achieve targeted profitability, business strategies measures such as cost leadership, product differentiation, product leadership and service delivery should be given high level of priority.