Firefighting, not managing: what the World Bank's 2025 survey says about how Nigerian firms are run

Executive summary

Between February and September 2025, the World Bank interviewed owners and top managers of 1,043 formal Nigerian firms with five or more employees¹. It is the most recent nationally representative picture of how formal Nigerian firms work.

Most coverage of surveys like this focuses on the obstacles firms name: electricity and finance top the list¹. This paper looks instead at the part of the survey that measures how firms are managed, because that is the part a leadership team controls.

Key findings

• On a 0 to 100 management practices index, Nigerian firms with 20 or more workers score 51.5, slightly above the Sub-Saharan Africa average of 48.0¹.
• The average hides a split. Firms score 80.6 on taking action when a problem arises, but 41.1 on the number of performance indicators they monitor, 34.8 on whether targets are achievable, and 27.3 on whether under-performers are reassigned or dismissed¹.
• Medium firms (20 to 99 staff) grew employment by 9.2% a year while real sales grew 1.4% a year. Large firms grew employment 5.1% a year while real sales fell 1.5% a year¹.
• Read through the ESRE OS, these patterns point to the Operating Model (L2) and Data & Intelligence (L4) layers. That is a hypothesis, and the inaugural AEHI edition will test it.

1. The survey

The World Bank Enterprise Surveys cover the formal, non-agricultural private sector. In Nigeria's 2025 round, 546 firms were small (5 to 19 employees), 344 medium (20 to 99) and 153 large (100 or more), spread across all six geopolitical zones¹. Firms with fewer than five employees, informal firms and fully state-owned firms are excluded.

The management practices questions are asked only of firms with 20 or more workers¹. That is close to the mid-market the AEHI measures, which makes this the most relevant public data on how Nigerian mid-market firms are run.

2. Good at reacting, weaker at preventing

The survey scores eight management practices from 0 to 100, where 100 is the most structured practice¹.

Source: World Bank Enterprise Surveys, Nigeria 2025¹.

The highest score is for acting when a problem arises. The lowest scores are for the routines that make problems visible early and stop them recurring: how many indicators are tracked, whether targets can actually be met, and what happens when someone consistently misses them.

In plain terms: firms are good at firefighting. They are less good at running the business so there are fewer fires.

3. More people, little more output

The survey also asks firms for their sales and permanent staff numbers now and three years earlier¹.

Source: World Bank Enterprise Surveys, Nigeria 2025¹.

Real sales are adjusted for inflation, and the three years before the survey included high inflation and a large devaluation of the naira, so part of this gap is the economy. But the pattern is sharpest in exactly the firms that the AEHI covers: medium firms added staff more than six times faster than real sales grew. When headcount grows faster than output, each new hire produces less. That is what happens when a business adds people to work around processes that are not written down, rather than fixing the processes.

4. Reading the data through the ESRE OS

The ESRE OS scores an enterprise on five layers: Business Design (L1), Operating Model (L2), Technology (L3), Data & Intelligence (L4) and Governance (L5). The World Bank does not use this model, so the mapping below is Crelligent's reading, not the World Bank's.

• L2 Operating Model. Low scores on achievable targets (34.8) and on acting on under-performance (27.3) describe work that is not designed or managed as a system: targets are set but not built around what the process can deliver, and nothing happens when they are missed.
• L4 Data & Intelligence. The score for the number of indicators monitored (41.1) and for staff knowing the targets (43.7) describe leaders and teams working with a partial view of performance. Problems are found when they surface, which fits the high firefighting score.
• Productivity. Headcount growing faster than real sales in medium and large firms is consistent with an operating model that scales by adding people rather than by improving how work flows.

This is a hypothesis. It is also the first of the three hypotheses the inaugural AEHI edition will test: that the Operating Model (L2) is the most common primary constraint in Nigerian mid-market enterprises.

5. What leaders can do now

1. Count what you track. List the indicators your leadership team actually reviews each week. If there are fewer than five, or none covers delivery or quality, start there.
2. Test your targets. For each team target, ask whether the current process could hit it if everyone did their job well. If not, the target is a wish, and people learn to ignore it.
3. Write down one core process. Pick the process that most often needs the CEO or founder to step in. Document who does what, in what order, and who decides.
4. Check headcount against output. Compare staff growth with real revenue growth over the last two years. If staff grew faster, find where people are compensating for a process gap.

Take part in the AEHI

The World Bank data shows the pattern across all formal firms. The AEHI will measure it directly, layer by layer, for Nigerian mid-market enterprises. Take the free diagnostic to get your own ESRE OS Performance Score and to be part of the inaugural edition, or see the evidence charts.