Strategic capabilities and sustainability of SMMEs in Gauteng: a case of Roodepoort area in Johannesburg.
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Date
2018
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Abstract
Despite the interventions of South African government on SMMEs, there is still a huge challenge in ensuring that SMMEs are sustainable. SMMEs plays a major role in the sustenance of the South African economy. However, the lack of access to the necessary capabilities has led to the close down of many small businesses. Therefore, to achieve continuous success and low failure rate in SMME sector, there is need for the knowledge and awareness on the essential strategic capabilities for business sustainability. The challenges faced by SMMEs should also be carefully examined and monitored in order to provide lasting solutions.
This research adopted the Sustainable Business Model (SBM) as the theoretical framework underpinning the concept and structure of the study. The SBM was used in the study as a foundation for identifying and suggesting the integration of strategic capabilities for the sustainability of SMMEs. This study performed an exploratory research analysis through quantitative research method to understand the level of awareness and adoption of various strategic capabilities within the SMME industries. The study investigated and identified the various key strategic capabilities available for SMMEs’ sustainability. The research also investigated challenges that SMMEs face in applying and performing the business actions/strategies for sustainability of their businesses. The study further examined the impact of adopting and performing business actions/strategies for the sustainability of SMMEs.
In the process of understanding the essential strategic capabilities for sustainability of SMMEs, the findings of the study identified various essential strategic capabilities available within SMMEs. These essential strategic capabilities are in form of business strategies and process improvement actions. The cohesion of these two factors when effectively applied, ensures profitability and sustainability of SMMEs. Hence, recommendations were proposed on strategies that will ensure business sustenance over a long period. The study recommends and suggests that government support and intervention programmes should be effectively implemented to support SMMEs. Large organisations were encouraged to network and partner with SMMEs in order to enhance flexibility in organisational structure of large companies to accommodate business relationships with SMMEs. The study further recommends that SMMEs should build Business-to-Consumer (B2C) relationships in order to establish trust between SMMEs and their clients. Lastly, governments were encouraged to be consistent in their labour laws and implement low tax rates to ensure sustainability of SMMEs.
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Masters Degree. University of KwaZulu-Natal, Durban.