Complementarity in firm-level innovation strategies: a comparative study of Kenya and Nigeria

Figures & data

Table 1. Description of the variables employed in the analysis.

Variable	Definition
Dependent variables
SNFMPROD	Percentage of sales from innovative products that are new to the firm or to the domestic market
SNMPROD	Percentage of sales from products that are new to the domestic market
Independent variables
PROCINN	Dummy variable taking a value of 1 if at least one new process in the three years prior to the survey introduced and 0 otherwise.
SERVICES	Dummy variable taking a value of 1 firm's main activity is in a services industry and 0 otherwise
LNEMPLOY	Logarithm of the number of employees in the year of the survey
GROUP	Dummy variable taking a value of 1 if the firm belongs to a group of firms and 0 otherwise.
EXPORT	Dummy variable taking a value of 1 if the firm has exported during the three years prior to the survey and 0 otherwise.
COOPER	Dummy variable taking a value of 1 if the firm has cooperated in innovation during the three years prior to the survey and 0 otherwise.
MAKE AND BUY	Dummy variable taking a value of 1 if the firm has engaged in internal R&D and procured external knowledge during the three years prior to the survey and 0 otherwise.
BUY ONLY	Dummy variable taking a value of 1 if the firm has procured external knowledge but not engaged in internal R&D during the three years prior to the survey and 0 otherwise.
MAKE ONLY	Dummy variable taking a value of 1 if the firm has engaged in internal R&D but not procured external knowledge during the three years prior to the survey and 0 otherwise.
NO MAKE OR BUY	Dummy variable taking a value of 1 if the firm has neither engaged internal R&D nor procured external knowledge during the three years prior to the survey and 0 otherwise.
MKT AND ORG	Dummy variable taking a value of 1 if the firm has implemented both marketing and organizational innovation during the survey period and 0 otherwise.
MKT ONLY	Dummy variable taking a value of 1 if the firm has implemented only marketing innovation during the survey period and 0 otherwise.
ORG ONLY	Dummy variable taking a value of 1 if the firm has implemented only marketing innovation during the survey period and 0 otherwise.
NO MKT OR ORG	Dummy variable taking a value of 1 if the firm has implemented neither marketing nor organizational innovation during the survey period and 0 otherwise.

Table 2. Descriptive statistics, Nigerian subsample.

Variable	N	Min	Mean	Max	Std Dev
PRODINN	1336	0	0.548	1	0.498
PROCINN	1332	0	0.631	1	0.483
SNFMPROD	734	0	0.397	1	0.349
SNMPROD	733	0	0.173	1	0.226
SERVICES	1359	0	0.345	1	0.476
LNEMPLOY	1341	2.079	3.865	9.741	1.328
GROUP	1359	0	0.205	1	0.404
EXPORT	1359	0	0.167	1	0.373
COOPER	984	0	0.262	1	0.440
MAKE AND BUY	1190	0	0.220	1	0.415
BUY ONLY	1190	0	0.446	1	0.497
MAKE ONLY	1190	0	0.012	1	0.108
NO MAKE OR BUY	1190	0	0.322	1	0.467
MKT AND ORG	1359	0	0.506	1	0.500
MKT ONLY	1359	0	0.125	1	0.331
ORG ONLY	1359	0	0.077	1	0.267
NO MKT OR ORG	1359	0	0.292	1	0.455

Table 3. Descriptive statistics, Kenyan subsample.

Variable	N	Min	Mean	Max	Std Dev
PRODINN	310	0	0.413	1	0.493
PROCINN	310	0	0.332	1	0.472
SNFMPROD	180	0	0.614	1	0.408
SNMPROD	179	0	0.093	1	0.222
SERVICES	310	0	0.871	1	0.336
LNEMPLOY	304	0	2.645	8.70	1.63
GROUP	310	0	0.31	1	0.463
EXPORT	306	0	0.252	1	0.435
COOPER	212	0	0.505	1	0.501
MAKE AND BUY	199	0	0.437	1	0.497
BUY ONLY	203	0	0.35	1	0.478
MAKE ONLY	199	0	0.065	1	0.248
NO MAKE OR BUY	202	0	0.173	1	0.379
MKT AND ORG	310	0	0.465	1	0.499
MKT ONLY	310	0	0.061	1	0.24
ORG ONLY	310	0	0.19	1	0.393
NO MKT OR ORG	310	0	0.242	1	0.429

Table 4. Relationship between innovation strategy and innovative sales, Nigerian sample.

	SNFMPROD (n = 734)		SNMPROD (n = 733)
	Mean	Std. Dev.	Mean	Std. Dev.
MAKE AND BUY	0.429	0.356	0.194	0.228
BUY ONLY	0.410	0.343	0.169	0.228
MAKE ONLY	0.345	0.334	0.166	0.191
NO MAKE OR BUY	0.297	0.344	0.145	0.216
MKT AND ORG	0.440	0.350	0.184	0.234
MKT ONLY	0.369	0.335	0.156	0.195
ORG ONLY	0.337	0.352	0.160	0.223
NO MKT OR ORG	0.326	0.349	0.154	0.209

Table 5. Relationship between innovation strategy and innovative sales, Kenyan sample.

	SNFMPROD (n = 180)		SNMPROD (n = 179)
	Mean	Std. Dev.	Mean	Std. Dev.
MAKE AND BUY	0.671	0.381	0.149	0.272
BUY ONLY	0.659	0.398	0.057	0.176
MAKE ONLY	0.323	0.393	0.019	0.038
NO MAKE OR BUY	0.519	0.44	0.067	0.199
MKT AND ORG	0.639	0.396	0.128	0.266
MKT ONLY	0.768	0.398	0.064	0.15
ORG ONLY	0.551	0.42	0.007	0.029
NO MKT OR ORG	0.592	0.444	0.083	0.209

Table 6. Complementarity between making and buying, Nigerian data.

Dependent variable:	SNFMPROD		SNMPROD
	Tobit	Heckman	Tobit	Heckman
Estimation method:	(i)	(ii)	(iii)	(iv)
SERVICES	−0.0760**	−0.0675***	−0.0992***	−0.0616***
	(0.0299)	(0.0253)	(0.0262)	(0.0149)
LNEMPLOY	−0.0186	−0.0132	0.00142	0.0130**
	(0.0117)	(0.00983)	(0.00996)	(0.00634)
GROUP	−0.0578*	0.0787***	−0.0362	−0.0368**
	(0.0334)	(0.0278)	(0.0287)	(0.0174)
EXPORT	0.0443	−0.00336	0.0370	0.0333*
	(0.0356)	(0.0306)	(0.0300)	(0.0201)
COOPER	0.00259	0.0123	0.0205	0.0141
	(0.0292)	(0.0196)	(0.0256)	(0.0158)
PROCINN	0.147***	0.0831**	0.116**	0.0706***
	(0.0544)	(0.0332)	(0.0488)	(0.0206)
MAKE AND BUY	0.302***	0.469***	0.117*	0.0855**
	(0.0791)	(0.0545)	(0.0676)	(0.0344)
BUY ONLY	0.292***	0.470***	0.0458	0.0784***
	(0.0724)	(0.0518)	(0.0624)	(0.0304)
MAKE ONLY	0.176	0.365***	−0.0149	0.0539
	(0.120)	(0.0711)	(0.0905)	(0.0486)
NO MAKE/BUY	0.186**	0.452***	−0.000615	0.101***
	(0.0735)	(0.0516)	(0.0619)	(0.0321)
Observations	660	731	659	731
Log likelihood	−341.388	−316.142	−242.988	−128.513
Complementarity	.0372	2.9471	1.2849	1.5193
p-Value	.8472	.086	.2574	.2177

Notes: Standard errors in parentheses. *p < 0.1; **p < 0.05; ***p < 0.01.

Table 7. Complementarity between making and buying, Kenyan data.

Dependent variable:	SNFMPROD		SNMPROD
	Tobit	Heckman	Tobit	Heckman
Estimation method:	(i)	(ii)	(iii)	(iv)
SERVICES	−0.508**	−0.219***	0.188	0.0313
	(0.208)	(0.0850)	(0.240)	(0.0633)
LNEMPLOY	−0.0377	−0.0251	0.0144	−0.00183
	(0.0391)	(0.0216)	(0.0412)	(0.0123)
GROUP	−0.191	−0.0249	0.102	0.00406
	(0.136)	(0.0798)	(0.130)	(0.0405)
EXPORT	−0.102	−0.00788	0.0546	−0.0152
	(0.133)	(0.0739)	(0.153)	(0.0438)
COOPER	−0.00675	0.0196	0.375**	0.0849**
	(0.124)	(0.0635)	(0.151)	(0.0362)
PROCINN	0.234*	0.128**	−0.188	−0.0349
	(0.123)	(0.0631)	(0.145)	(0.0419)
MAKE AND BUY	1.445***	0.765***	−0.696**	0.126
	(0.278)	(0.149)	(0.311)	(0.0787)
BUY ONLY	1.440***	0.733***	−0.840***	0.0608
	(0.259)	(0.136)	(0.317)	(0.0836)
MAKE ONLY	0.857***	0.339**	−0.944**	0.0159
	(0.284)	(0.152)	(0.376)	(0.0765)
NO MAKE/BUY	1.340***	0.708***	−0.987***	0.0606
	(0.283)	(0.154)	(0.342)	(0.0880)
Observations	175	255	174	254
Log likelihood	−157.0097	−225.5139	−98.7716	−143.2065
Complementarity	3.3014	8.1063	.1019	3.669
p-Value	.071	.0044	.75	.0554

Notes: Standard errors in parentheses. *p < 0.1; **p < 0.05; ***p < 0.01.

Table 8. Complementarity between organizational and marketing innovations, Nigerian data.

Dependent variable:	SNFMPROD		SNMPROD
	Tobit	Heckman	Tobit	Heckman
Estimation method:	(i)	(ii)	(iii)	(iv)
SERVICES	−0.110***	−0.0768***	−0.126***	−0.0657***
	(0.0298)	(0.0260)	(0.0265)	(0.0151)
LNEMPLOY	−0.0193*	−0.00904	0.00333	0.0126**
	(0.0112)	(0.00953)	(0.00950)	(0.00620)
GROUP	−0.0696**	−0.0868***	−0.0386	−0.0384**
	(0.0330)	(0.0275)	(0.0287)	(0.0174)
EXPORT	0.0557	0.0172	0.0479	0.0345*
	(0.0354)	(0.0305)	(0.0303)	(0.0203)
COOPER	−0.00136	0.00475	0.0274	0.0134
	(0.0282)	(0.0184)	(0.0251)	(0.0157)
PROCINN	0.133**	0.0776**	0.114**	0.0615***
	(0.0529)	(0.0313)	(0.0478)	(0.0199)
MKT AND ORG	0.377***	0.457***	0.100	0.104***
	(0.0712)	(0.0497)	(0.0609)	(0.0305)
ORG ONLY	0.228***	0.370***	−0.0240	0.0737**
	(0.0774)	(0.0548)	(0.0672)	(0.0350)
MKT ONLY	0.299***	0.444***	0.0501	0.0834**
	(0.0857)	(0.0704)	(0.0731)	(0.0370)
NO MKT/ORG	0.182**	0.386***	−0.00979	0.0836***
	(0.0709)	(0.0501)	(0.0601)	(0.0305)
Observations	660	731	659	731
Log likelihood	−327.6157	−311.1227	−238.9882	−127.8509
Complementarity	.164	.2773	1.0392	.7533
p-value	.6856	.5985	.3084	.3854

Notes: Standard errors in parentheses. *p < 0.1; **p < 0.05; ***p < 0.01.

Table 9. Complementarity between organizational and marketing innovations, Kenyan data.

Dependent variable:	SNFMPROD		SNMPROD
	Tobit	Heckman	Tobit	Heckman
Estimation method:	(i)	(ii)	(iii)	(iv)
SERVICES	−0.317*	−0.123	0.153	0.0650
	(0.176)	(0.0885)	(0.169)	(0.0542)
LNEMPLOY	−0.00944	−0.00257	0.0265	0.00480
	(0.0386)	(0.0230)	(0.0384)	(0.0124)
GROUP	−0.124	0.00980	0.0795	0.0105
	(0.138)	(0.0827)	(0.125)	(0.0388)
EXPORT	−0.216	−0.0659	−0.0359	−0.0399
	(0.132)	(0.0759)	(0.151)	(0.0457)
COOPER	0.107	0.0677	0.346**	0.0982**
	(0.123)	(0.0640)	(0.150)	(0.0416)
PROCINN	0.332***	0.176***	−0.255*	−0.0314
	(0.119)	(0.0627)	(0.138)	(0.0397)
MKT AND ORG	1.026***	0.482***	−0.616***	0.0535
	(0.218)	(0.135)	(0.215)	(0.0800)
ORG ONLY	0.947***	0.419***	−1.315***	−0.0663
	(0.236)	(0.150)	(0.341)	(0.0686)
MKT ONLY	1.464***	0.715***	−0.576**	0.0274
	(0.353)	(0.143)	(0.284)	(0.0784)
NO MKT/ORG	1.122***	0.491***	−0.635***	0.0345
	(0.232)	(0.143)	(0.227)	(0.0785)
Observations	175	255	174	254
Log likelihood	−158.7953	−228.9343	−93.4529	−141.9306
Complementarity	.4971	1.3038	2.9962	3.9183
p-Value	.4818	.2535	.0853	.0478

Notes: Standard errors in parentheses. *p < 0.1; **p < 0.05; ***p < 0.01.