THE BUSINESS ENVIRONMENT AND SMME DEVELOPMENT

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THE ENVIRONMENT AND THE DELIVERY OF BUSINESS DEVELOPMENT SERVICES

Ligthelm & Cant (2003:41) Section 2.3.2 classified problems that faced a sample of Gauteng businesses as “economy based”, “industry related” and “firm linked”. It is now argued that the same issues affect the delivery of BDSs by service providers and, to add to this, there are other forces flowing from the interactions in the market that impact on service provision. The next section deals with these processes and how they impact on service delivery.
It will be recalled that Butler (2006:237), Pretorius (2003:275) and Kennerley et al (2003:237) opined that intervening variables abound in the business environment and impact on processes. Porter’s (2008) five forces model (Figure 2.3) and Henry et al’s (2003) model (Figure 2.4) show the causes of the variables and that most of the time the general business environment is not small business friendly.
In Figure 3.2 Hersey, Blanchard & Johnson (2001:133) reinforce contentions by Bridge et al (2003:53) and Hjalmarsson & Johansson (2003:83) that internal and external variables influence the provision of services to SMMEs and thus influence outcomes. In fact, Bordens and Abbot (2008:98) believe that in causal relationships one variable directly and indirectly influences another. The indirect influence is at issue here as the variables are intervening and not necessarily made to intervene.

The variables that impact on the provision of services

The “intervening variables” in Figure 3.2 include traditional practices or cultures. Lambrecht & Pirnay (2005:91) refer to several barriers in the provision of service by external consultants to SMMEs. Lambrecht & Pirnay (2005:91) group these barriers into “demand and supply” constraints. Lambrecht & Pirnay (2005:91) further posit that the “demand-driven constraints” include the characteristics of both entrepreneur and enterprise in the use of consultants. For instance, they quote from research conducted by Smallbone and others in 1993 who opine that entrepreneurs with higher educational qualifications are more likely to use external consultants. This makes sense as better educated entrepreneurs would understand the importance of using consultants when necessary.
Lambrecht & Pirnay (2005:91) identify supply-side problems as “adverse selection”, when the consultant serves his own interests rather than those of the client. Other supply-side problems, Lambrecht & Pirnay maintain, are aggressive sales selling, abandoning the SMME, cultivating a dependency relationship and they cite research by Donckels in 1992, Boschaart in 2001 and Soriaro and others in 2002 who expressed similar sentiments.
These dynamics express themselves in various ways and influence the SMMEService Centre relationship. They include the following and this list is not exhaustive:
• The fact that solutions being provided to SMMEs were initially aimed at big organisations;
• The phase of growth of an organisation determines the services that are needed;
• SMME and BDS heterogeneity;
• SMME attitudes to education and training; and
• The target market also determined the type of intervention.
These aspects are now explained to give a clearer perspective as to how they create constraints or become constraints.

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CHAPTER 1 BACKGROUND AND DEFINITION OF  STUDY
1.1 Introduction
1.2 Literature review
1.3 Importance of the study
1.4 Definition of the research problem
1.5 Purpose of the study
1.6 Research objectives
1.7 Proposition
1.8 Research methodology
1.9 Demarcation and limitations of the study
1.10 Structure of the study
1.11 Abbreviations and acronyms
CHAPTER 2 THE BUSINESS ENVIRONMENT AND SMME DEVELOPMENT
2.1 Introduction
2.2 The importance of SMMEs
2.3 Gauteng’s SMME community
2.4 The general environment and SMMEs
2.5 Government mandate to create an enabling environment for SMMEs
2.6 Strategies for entrepreneurship and SMME development
2.7 Conclusion
CHAPTER 3 THE DISTRIBUTION AND DELIVERY OF BUSINESS DEVELOPMENT SERVICES THROUGH SERVICE CENTRES
3.1 Introduction
3.2 The contextualisation of Business Development Services in the environment
3.3 The distribution of Business Development Services
3.4 The environment and the delivery of Business Development Services
3.5 Current debate on the delivery of Business Development Services
3.6 Conclusion
CHAPTER 4 EVALUATING AND DETERMINING THE “EFFECTIVENESS” OF BUSINESS DEVELOPMENT SERVICE CENTRES
4.1 Introduction
4.2 Evaluating “effectiveness”
4.3 The rationale of evaluating programmes
4.4 Pitfalls of evaluating service centres
4.5 Determining “effectiveness” in the delivery of Business Development Services
4.6 Conclusion
CHAPTER 5 THE LOCAL BUSINESS SERVICE CENTRE PROGRAMME
5.1 Introduction
5.2 The LBSC programme
5.3 Gauteng and the LBSC programme
5.4 Thrust of the LBSC programme
5.5 Implementation of the LBSC programme
5.6 Analysis of the problems encountered in the roll-out of the LBSC programme
5.7 Conclusion
CHAPTER 6 RESEARCH METHODOLOGY AND DATA ANALYSIS
6.1 Introduction
6.2 Definition of the research problem and objectives
6.3 Proposition
6.4 Universe, population and units of analysis
6.5 Sample frame and size, methods and response rate
6.6 Data collection
6.7 Measurement and instruments
6.8 Data analysis and interpretation
6.9 The reliability and validity of the measuring tool
6.10 Conclusion
CHAPTER 7 RESEARCH FINDINGS 200
7.1 Introduction
7.2 Empirical findings
7.3 Demographics of the respondents
7.4 Factor analysis
7.5 Tests of significance (t-test)
7.6 Analysis of variance (Anova)
7.7 Responses to the open-ended question
7.8 Focused interviews with Government officials and LBSCs
7.9 Conclusion
CHAPTER 8 DISCUSSIONS, CONCLUSIONS AND RECOMMENDATIONS
8.1 Introduction
8.2 Literature review
8.3 Achievement of the study’s objectives
8.4 Discussions
8.5 Attainment of study objectives
8.6 Limitations of the study and areas for future research
8.7 Recommendations
8.8 Conclusion
REFERENCES

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