۱- Introduction

۲- Objectives of study

۳- Literature review

۴- The conceptual model

۵- Methodology

۶- Discussion of findings

۷- Conclusion

References

Abstract

Significant knowledge exists regarding the application of dynamic capability (DC) frameworks in large firms, but their impact on smaller organisations is yet to be fully researched. This study surveyed 1162 small and medium sized enterprises (SMEs) in Lagos in an effort to understand how SMEs in developing country contexts use mobile apps to enhance their businesses through DCs. Through the use of the covariance-based structural equation modelling (SEM) technique, the study explored the fitness of a conceptual formative model for SMEs. The model assembled 7 latent variables namely: mobile app usage, adaptive capability, absorptive capability, innovative capability, opportunity sensing ability, opportunity shaping ability and opportunity seizing ability. Subsequently, 15 hypotheses aimed at testing the relationships between the latent variables were developed and tested. The findings revealed that mobile app usage increases the adaptive, absorptive and innovative capabilities of SMEs. Absorptive capabilities help SMEs to maximise opportunities, while innovative capabilities negatively influence SMEs’ tendency to maximise opportunities. The results failed to establish a direct relationship between mobile app usage and SMEs’ ability to maximise opportunities. The research outcomes indicate that SMEs in Lagos respond to opportunities innovatively but they seldom exhibit innovation in order to create opportunities. The heterogeneous nature of SMEs complicates any clear-cut narrative as to how SMEs in Lagos should employ mobile apps to create and maximise opportunities. However, mobile apps could induce innovation and, as such, impact significantly when developed and applied to the contextual requirements of SMEs. The research revealed the untapped potential of SMEs’ mobile app usage in Lagos.

Introduction

The dynamic capability (DC) framework affirms that sustaining a competitive advantage in unstable business environments demands the continuous reconfiguration of resources (Helfat et al. 2007; Kuria & Kitenga, 2014). Small and medium sized enterprises (SMEs) are increasingly adopting ICT as a strategy to sustain this competitive advantage (Wang & Shi, 2011). SMEs do this through adopting strategies which appeal to customers’ propensity to use mobile apps because of the flexibilities that mobile apps offer (Chou et al., 2013). Whereas the usefulness of DCs in large firms has been significantly researched, there is limited knowledge as to the relevance of the DC framework in smaller organisations, like SMEs. Bearing in mind that SMEs are considered as the foundation of national economies in developing countries, this study sought to understand how SMEs use mobile apps as part of their DCs. This study focused on SMEs in Lagos, Nigeria. In the Nigerian context, SMEs are defined as businesses which employ fewer than 50 persons and which have an annual turnover of 50 million Naira (158,000 USD) (SMEDAN & NBS, 2013). SMEs create an economic buffer and contribute substantially to the development of many countries (Kingdom & Taylor, 2015) as they stimulate entrepreneurship, create jobs, trigger innovation and accelerate rural industrialisation (Ayanda & Adeyemi, 2011; Kale, 2015). The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) noted that in 2013 there were 36,994,578 micro businesses, 68,168 small businesses and 4,670 medium sized businesses in Nigeria. Despite these impressive numbers, unemployment, crime and poverty in Nigeria, as in many other developing countries, remain unsolved issues.