The entrepreneurial orientation of small businesses in the Eastern Cape
- Authors: Matchaba-Hove, Mtonhodzi
- Date: 2013
- Subjects: Small business -- South Africa -- Eastern Cape , Economic development -- South Africa -- Eastern Cape , Job creation -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:9304 , http://hdl.handle.net/10948/d1017139
- Description: The high failure rate among small businesses in South Africa has created an urgent need to identify strategies that will improve their levels of performance. The purpose of this study was to investigate the relationship between the entrepreneurial orientation of small businesses in the Eastern Cape and their level of business success. Entrepreneurial orientation was assessed in terms of the 5 dimensions of entrepreneurial orientation, namely Innovativeness, Proactiveness, Competitive aggressiveness, Risk-taking and Autonomy. Business success was assessed in terms of profitability and growth. A literature overview was firstly conducted. The nature and importance of small businesses were described, and the important contributions they make to economic growth, job creation and innovation, as well alleviating poverty and redistributing income were highlighted. The various challenges faced by small businesses were also discussed. Among these challenges, the lack of entrepreneurial orientation was specifically highlighted as a major barrier to small business success. The nature of entrepreneurial orientation and the five dimensions thereof were described. A theoretical framework was proposed illustrating the relationships between the 5 dimensions of entrepreneurial orientation and business success that were to be empirically tested. A positivistic research paradigm was followed and a quantitative approach was implemented. Convenience sampling was used and a total of 350 questionnaires were distributed to small businesses in the Eastern Cape; 317 usable questionnaires were yielded. A measuring instrument was developed based on reliable and valid items from existing studies. Statistical techniques including descriptive statistics, Pearson's product moment correlations, Structural Equation Modelling and an Analysis of Variance were performed on the gathered data. Demographic data relating to the gender, age and race of the respondents, as well as data relating to the number of employees, the tenure of the business, and nature of industry in which the small businesses operate, were collected. An exploratory factor analysis was undertaken, and Cronbach‟s alpha coefficients were calculated to assess the validity and reliability of the measuring instrument. The independent variables, Innovativeness and Proactiveness, could not be confirmed by the factor analysis and a new dimension emerged which was named Proactive innovativeness. As a result of the factor analysis the operational definitions were rephrased. The Cronbach‟s alpha coefficients reported were all greater than 0.7, deeming the scales measuring the various dimensions reliable. Descriptive statistics were calculated to summarise the sample data, and Pearson's product-moment correlation coefficients were established to investigate the associations between the variables. Significant positive correlations were reported between all of the variables. SEM was performed to determine the significance of the relationships hypothesised between the independent and dependent variables in this study. The results of this study showed that the independent variables Competitive aggressiveness, Proactive innovativeness and Autonomy have a significant positive influence on the dependent variable Business success, while Risk-taking was found to have a significant negative influence on Business success. Furthermore, the results showed that Proactive innovativeness was higher in larger-sized small businesses, Autonomy was reported to be higher in small businesses where the owner was in possession of a tertiary qualification, and Risk-taking was found to be higher in small businesses owned by people of colour than in businesses owned by White respondents. In a business environment where change is constant, small business owners need to be able to adapt their operations and strategies to these changes and the consumer demands these changes may bring. Small business owners need to be able to strategically reinvent their businesses if they are to survive over the long term. The level of entrepreneurial orientation has been identified as having a positive influence on business success. The more small businesses implement Proactive innovativeness, Competitive aggressiveness, calculated and cautions Risk-taking and Autonomy, the better the chances are that they will be successful
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- Date Issued: 2013
An investigation into causes of success and failure in small businesses within the Department of Social Development in the Eastern Cape
- Authors: Petrus, Henry George
- Date: 2009
- Subjects: South Africa -- Dept. of Social Development , South Africa -- Dept. of Trade and Industry , Small business -- South Africa -- Eastern Cape , Small business -- South Africa -- Eastern Cape -- Growth , Business enterprises -- Economic aspects -- South Africa -- Eastern Cape , Economic development -- South Africa -- Eastern Cape , Job creation -- South Africa
- Language: English
- Type: Thesis , Masters , MBA
- Identifier: vital:791 , http://hdl.handle.net/10962/d1003942
- Description: The failure rate of small business initiatives in South Africa is phenomenal, and much is needed to unravel the causes contributing to such failures. Yet small businesses are playing a vital part in our global economy and in particular in terms of job creation and poverty eradication. There are internal as well as external factors that play a significant role in determining the success of these small businesses. In South Africa much emphasis is placed by national, provincial and local governments on small and medium enterprises (SMEs) to drive wealth creation and black economic empowerment. Therefore, an investigation into the factors contributing to the success and failure of SMEs is of vital importance. The South African government’s poverty eradication strategy, which is driven by the Department of Trade and Industry (DTI), allocated funds for job creation programmes as a method to combat poverty and more importantly, to develop young entrepreneurs. Among the seven departments mandated by DTI was the Department of Social Development. Since the birth of the new democracy, this department has transformed from offering a traditional remedial method of service delivery to an integrated developmental approach. This approach included extensive community work, which includes job creation and economic empowerment through the establishment of small businesses. Given the availability of funding, the inability to spend fiscal budgets as per allocation as well as the charity element of receiving involved, it is important to explore whether factors contributing to the success of these SMEs are any different to the traditional business strategies. In this study, the researcher gave special consideration to the social capital element and its contribution in the context of community support as well as the ability of SMEs to become sustainable business ventures over time. The research study aims to highlight unique factors contributing to the success and failures of SMEs established by the Department of Social Development and in doing so hopes to manifest an improved understanding of the management of these SMEs. In chapter one, the researcher gives a brief description of the activities of the Department of Social Development and its mandate to establish SMEs for job creation. A brief explanation regarding the context of the problem that was investigated is also given. Chapter two provides a detailed theoretical overview of the study, focusing in particular on factors contributing to the success and failure of small businesses. In chapter three, the research design and the various instruments used are discussed. Here, emphasis is placed on procedural issues and ethical considerations. The validity and reliability of the research is strongly motivated. In chapter four the research results are discussed. Chapter five aims to discuss the findings of the research with reference to the theoretical overview outlined in chapter two. Lastly, chapter six makes recommendations to the various stakeholders who may benefit from this research. These recommendations are the most important objectives of the research and should add value with regards to the management of SMEs in future, with special reference to the Department of Social Development in the Eastern Cape.
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- Date Issued: 2009
An investigation into problems facing small-to-medium sized enterprises in achieving growth in the Eastern Cape : enhancing the strategy for developing small 'growth potential' firms in the Eastern Cape
- Authors: Sha, Shafeek
- Date: 2006
- Subjects: Small business -- Management , Small business -- South Africa -- Eastern Cape , Small business -- South Africa -- Eastern Cape -- Growth , Business enterprises -- Economic aspects -- South Africa -- Eastern Cape , Economic development -- South Africa -- Eastern Cape
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:1173 , http://hdl.handle.net/10962/d1002789 , Small business -- Management , Small business -- South Africa -- Eastern Cape , Small business -- South Africa -- Eastern Cape -- Growth , Business enterprises -- Economic aspects -- South Africa -- Eastern Cape , Economic development -- South Africa -- Eastern Cape
- Description: As the world economy continues to move towards increased integration, some of the greatest opportunities for Small-to-Medium Sized Enterprises (SMEs) will derive from their ability to participate in the global marketplace. It is generally accepted that SMEs are becoming increasingly important in terms of employment, wealth creation, and the development of innovation. However, there are considerable doubts about the quality of management in this sector with policy-makers suggesting that there are particular weaknesses in innovation, a lack of financial acumen, marketing, entrepreneurial flair, practical knowledge, and human resource management. As a result, many firms do not reach their full potential and fail to grow. According to organisational life cycle models, the introductory phase is particularly important since it is generally known and accepted that there is a high mortality rate of SMEs within the first two years. Given this high failure rate, it becomes vital to research the factors/characteristics/management abilities that are required to enable the SME to survive and indeed progress to the growth phase of the organizational life cycle. This research seeks to investigate the internal and external factors that are consistent in the success of SMEs who have reached the growth phase. A significant contribution to the enhancement of the growth potential of a firm will be made through the understanding of these factors.
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- Date Issued: 2006