There is increasing consensus within South Africa about the importance of entrepreneurship in economic development. Although there have been significant steps taken towards increasing the level of entrepreneurial activity in South Africa, many challenges still remain. The Global Entrepreneurship Monitor (GEM) research continues to reveal that four major problems face entrepreneurship in South Africa, namely (1) a low level of overall education and training; (2) social factors that do not promote entrepreneurship as a career path of choice; (3) lack of access to finance; and (4) a difficult regulatory environment. Notwithstanding agreement on the importance of entrepreneurship in economic development, why is it then that South Africa finds itself in the position it is? There are many government and private sector initiatives aimed at promoting entrepreneurial development in South Africa. It, however, seems that the desired results are not achieved. Could it be that this is mainly attributable to the absence of a national strategy that encompasses stakeholders from both government and private sector? Or could it be that there is no aligned commitment, or the existence of a common goal, or coordination of initiatives on a macro level?
In addition, South Africa as a nation must upgrade its ways of competing if successful economic development is to occur; our companies must shift from competing on comparative advantages (low-cost labour or natural resources) to competing on competitive advantages arising from unique products and processes, and move from tapping foreign distribution channels to building our own channels. From the literature on entrepreneurship, it becomes evident that it has the potential to improve and increase productivity and ultimately GDP. It is therefore safe to suggest that an increase in entrepreneurial activity could potentially lead to an increase in productivity (and employment) that in turn could lead to an increase in real GDP. An increase in real GDP induces increased sales flows to the different factors of production – managers, workers, landowners, shareholders, and other input suppliers – and national income increases correspondingly.
What needs to be accomplished is a national strategy for entrepreneurial development in South Africa to spearhead and coordinate entrepreneurial development in South Africa on a national level. The ultimate purpose is to induce economic growth and making South Africa a stronger competitor in the mainstream global economic arena. A vehicle to bring such a strategy to fruition could be a unified national centre consisting of stakeholders from government and private sector to lead and coordinate entrepreneurial development across the country. The four key performance areas should be to (1) improve the level of overall education and training; (2) promote entrepreneurship as a career path of choice; (3) improve access to finance; and (4) influence policy in terms of the regulatory environment.
Kurt Lewin conceived of change as modification of those forces keeping a system’s behaviour stable. In relation to this discussion, it implies modifying those forces keeping South Africa’s entrepreneurial behaviour stable. Change efforts falls on a continuum ranging from incremental changes that would involve fine-tuning South Africa’s entrepreneurial position to quantum changes that would entail fundamentally altering how South Africa operates in terms of its entrepreneurial activity. What we need is an “entrepreneurial transformation,” which implies radical changes in how South Africans perceive, think, and behave in terms of entrepreneurship. It must supersede “making things better” or fine-tuning the status quo. It concerns fundamentally altering South Africa’s assumptions about its entrepreneurial functioning and how it relates to the global environment. Changing these assumptions entails significant shifts in our philosophies and values and in the numerous structures and arrangements that shape our current entrepreneurial behaviour. This change will inevitably require leadership… who will stand up to the challenge?
