Chinwo, C. E.
Department of Business Administration, Faculty of Administration and Management , Rivers State University, Port Harcourt, Nigeria
Abstract
The Nigerian aviation industry faces intense competition and operational challenges, necessitating effective strategies for sustainable performance. This study examined the relationship between diversification strategy and performance, measured through market performance (profitability, market share), operational performance (service efficiency, reliability), and adaptive performance (flexibility, innovation), of domestic airlines in South-South Nigeria. Anchored in Resource-Based Theory, Dynamic Capabilities Theory, and Institutional Theory, the study adopted a quantitative research philosophy with a cross-sectional survey design. The population comprised 50 managers from 10 domestic airlines, with a census sampling technique applied due to the small size. Data was collected via a 5-point Likert scale questionnaire, validated through expert review and confirmed for reliability (Cronbach’s alpha: 0.958–0.978). Inferential statistics (Spearman’s correlation) was used for analysis. Findings revealed very strong positive correlations between diversification and performance: market performance (r = 0.966, p < 0.01), operational performance (r = 0.956, p < 0.01), and adaptive performance (r = 0.946, p < 0.01). The study concludes that diversification significantly enhances airline performance but requires strategic implementation to avoid inefficiencies. Recommendations include conducting market research, phased diversification, workforce training, technology adoption, balanced portfolio management, and regular performance assessments to optimize outcomes.
Keywords: Diversification strategy, performance, market performance, operational performance, adaptive performance
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