DIVERSIFICATION STRATEGY AND ORGANIZATIONAL PRODUCTIVITY OF MANUFACTURING COMPANIES IN SOUTH EAST, NIGERIA

Abstract

This study explored diversification strategy and growth of manufacturing companies in south-East, Nigeria. The aim of the study was to examine the relationship between diversification strategy (Concentric and Horizontal) and organizational productivity of four listed manufacturing companies in South East, Nigeria. The study adopted descriptive survey design. The study population was 594, consisting of managers, supervisors and administrative staff of the four listed manufacturing firms in South-East, Nigeria. A sample size of two hundred and thirty-nine (239) managers, supervisors and administrative staff were drawn from the population using Taro Yamane while proportionate random sampling technique was used for selection of sample unit. Two hundred and fifteen (215) copies of questionnaire retrieved were completely filled and used for the study. The Spearman Rank Correlation (rho) was used to analyze the relationship between diversification strategy and organizational productivity while Theil-Sen Regression was used to test the hypotheses. The result of the analysis revealed that concentric and horizontal diversification had a significant positive relationship with the organizational productivity. The findings led to the conclusion that diversification is vital for improving the productivity of manufacturing firms in Nigeria's South-East. The study recommended, among others that manufacturing companies should diversify as to boost their streams of income while maximizing their capability, also horizontal diversification is recommended for its ability to avert decline in the product life cycle.