- LUCY KEREI, *Dr. Ndururi Joseph, **Dr. Mathenge Paul
- The Catholic University of Eastern Africa, Nairobi, Kenya
- FAR Journal of Financial and Business Research (FARJFBR)
- DOI
Women-owned
small and medium-sized enterprises in Nairobi face barriers including limited
resources, weak institutional support, and competitive market conditions that
restrict innovation and performance. This study examined how incremental,
radical, disruptive, and architectural innovations affect the performance of
women-owned SMEs in Nairobi County.
Grounded in the Induced Institutional Innovation Theory, Schumpeter’s Theory of Entrepreneurship, Diffusion of Innovations, Organizational Learning Theory, and the Resource-Based View, the research adopted a correlational design. A target of 938 registered enterprises was identified, and a sample of 273 was drawn through Cochran’s formula. Stratified sampling by sector, including retail, manufacturing, services, tourism, and financial services, ensured proportional representation. Structured questionnaires supported by a pilot test for validity and reliability provided the primary data. Quantitative analysis using SPSS Version 28 applied descriptive and inferential statistics, including correlation, regression, and ANOVA, while qualitative insights were drawn from content analysis. Findings revealed that all four types of innovation significantly enhanced performance. Incremental innovation (β = 0.238, p < 0.001) supported continuous improvement. Radical innovation (β = 0.277, p < 0.001) emerged as the strongest driver of enterprise outcomes. Disruptive innovation (β = 0.190, p < 0.001) opened market niches, while architectural innovation (β = 0.139, p = 0.001), though weaker, contributed by reconfiguring processes, strengthening adaptability, and improving efficiency. The study concluded that women entrepreneurs benefit from diverse innovation strategies, each adding unique value. Recommendations included integrating innovation training into entrepreneurship programs, offering financial incentives, and developing policies supporting informal and tech-enabled innovation, thereby enhancing sustainability of women-owned SMEs in Nairobi.
