Description

The government of South Africa has invested heavily in the development of SMEs since the
dawn of democracy in 1994, and continues to spend billions of rands in the sector every
year. In fact, there is a dedicated national department and many other SME desks and
agencies across all three tiers of government responsible for the development and promotion
of SMEs. The South African government has prioritised the development and promotion of
SMEs because the sector is widely regarded as the driving force for economic growth and
job creation in both developed and developing countries. Given the massive resources
which the South African government commits towards the SME sector, it is evident that the
apparent lack of impact is happening despite government’s initiatives.

Cognisant of the government’s demonstrated commitment towards SME development, this
study questions why government’s interventions and initiatives are ineffectual. The poor
performance of the SME sector, and start-ups in in particular necessitated the need for
alternative policies aimed at supporting and promoting SMEs – not only during their difficult
birthing stage, but also with regard to the management skills that are necessary to overcome
failure and promote their sustainability. Therefore, the study interrogates alternative methods
of stimulating and promoting SME development in South Africa, considering that current
government interventions and initiatives do not seem to be producing desired results –
particularly SME development policies and programs focused largely on stimulating
entrepreneurship and entrepreneurial, with start-up activity as the barometer.

The study questions whether all SME business owners are entrepreneurs and always
engage in entrepreneurship and entrepreneurial business activity. The study also questions
whether some of the business owners who are currently regarded as entrepreneurs are
really entrepreneurs in the truest sense of the word. More thought provoking questions are
also raised. Is the current targeted entrepreneurial support serving its purpose of stimulating
SMEs? Is there a potential model which the government can adopt in order to create
sustainable SMEs, create jobs and achieve inclusive growth?

In order to answer the foregoing questions, an exploratory – qualitative study was conducted.
A sample of four opportunity (high-impact) entrepreneurs were interviewed using a semistructured open-ended questionnaire. The collected data was transcribed, after which
thematic and scientific content analysis was conducted in order to identify the emerging
themes. External experts were employed to validate the accuracy of the identified emerging
themes and the credibility of the findings. The results were then interpreted and implications
and contributions discussed.

The research findings revealed that South Africa’s current SME policies and programs may
be ineffectual because they are biased towards the development and support of start-ups
and necessity entrepreneurs, which are prone to high failure and self-employment. The
study concluded that there was need for a new alternative SME development and support
model – hereby called ‘enterpriseneurship’, whose thrust is to strengthen existing highimpact
SMEs by scaling them up and replicating their businesses using non-entrepreneurial
business owners and managers as enterprise development agents. It is posited that the
implementation of ‘enterpriseneurship’ is likely to counter the current high failure rate of startups by fostering the creation of sustainable business enterprises, thus facilitating the
creation of sustainable jobs, reduction of poverty and reduction of inequality through
inclusive economic growth – among others.

The findings and recommendations of the study have implications for, and make
contributions to policy makers, SME development agencies, academics, society and self.
The researcher believes that with further research or contributions from other researchers
on the enterpriseneurship model – theory could be developed for a new academic discipline
contributing immensely towards job creation, poverty alleviation, reduction of inequality and
inclusive economic development in South Africa.