Strategic Innovation, Digital Dexterity and Service Quality of Selected Quoted Deposit Money Banks in Nigeria

A company's approach for enhancing service quality through digitalization of services aims to produce digital-based services that respond to consumers' increasingly digital requirements. Similarly, the banking industry keeps innovating to improve the quality of its services. Adoption, execution, and proper use of innovation and digitalization in financial services are techniques that can address issues that arise in terms of increasing banking service quality. However, in recent years, difficulties such as bank service reliability, reduced service responsiveness, a lack of empathy, and insufficient service assurance have been identified as significant factors negatively influencing bank service quality. Despite several research on strategic innovation and service quality in developed economies, few studies have been conducted in Nigeria. Hence, this study examined the effect of strategic innovation and digital dexterity on service quality of selected Quoted Deposit Money Banks in Nigeria. Survey research design was adopted. The population was 6,975,037 corporate customers and 4,873 employees of eight systemically important deposit money banks operating in Lagos, Nigeria. A sample size of 501 corporate customers and 464 bank employees was determined using Raosoft calculator. Convenience sampling technique was adopted in selection of bank corporate customers, while stratified random sampling technique was adopted for the bank employees. A validated questionnaire was used to collect data. Cronbach’s alpha reliability coefficients for the constructs ranged from 0.79 to 0.92. The response rate was 95.4%. Data were analyzed using descriptive and inferential statistics. Findings revealed that strategic alignment (β = .872, t = 8.611, p = .000), strategic foresight (β = 0.941, t = 10.295, p = .000), organizational readiness (β = 0.983, t = 11.656, p = .000), and organizational responsiveness (β = 1.046, t = 15.263, p = .000) have positive and significant effect on service quality. While organizational pro-activeness (β = -.035, t = -.517, p = .605) and organizational flexibility (β = -.099, t = -1.573, p = .116) have negative and insignificant effect on service quality of the selected Quoted Deposit Money Banks in Nigeria. The study concluded that strategic innovation dimensions and digital dexterity dimensions had significant effect on service quality of the selected Quoted Deposit Money Banks in Nigeria. The study therefore recommends that bank management should insist and practice continued strategic innovation and digital dexterity to improve the overall service quality of their Banks.