A competency framework for the small business sector in Johannesburg South Africa

Abstract

One of the most serious challenges that South Africa faces is the high unemployment level. The small business sector is globally recognised as a driver for job creation. However, low knowledge and skills levels in the South African population remain a serious problem and the lack of managerial knowledge and skills are often cited as the reason for the failure of small businesses. In addition, previous research confirmed that the education and skills level of an entrepreneur and the success of their business are related. One of the best ways to address unemployment is to leverage the employment creation potential of small businesses and to promote small business development through improving the competencies of the owners/managers of small businesses. The purpose of this study was to identify and prioritise the specific knowledge and skills that the owners’/managers’ of small businesses need in order to succeed. A self-administered survey questionnaire was used to collect data from 88 small business owners/managers in Johannesburg. Descriptive, as well as inferential statistical analysis, were performed. Based on the results of the factor analysis, a conceptual competency framework for the owners/managers’ of small businesses in South Africa was designed. The results of the study indicated that training needed in the areas of risk management, financial management, industry awareness and project management were significant. The four main competencies, as well as the ten underlying competencies are represented in the framework.