Antecedents of internationalisation of indigenous-owned SMEs in South Africa
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Date
2018
Authors
Sono, Thabe Johannes Godfrey
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Abstract
Target Journal:
The Southern African Journal of Entrepreneurship and Small Business
Management
Background: There is an increasing interest in indigenous entrepreneurship as
a tool that can be used to address the triple challenge of poverty, inequality and
unemployment. Indigenous entrepreneurs want to participate in the new global
economy, but literature has found that Indigenous entrepreneurs are profoundly
affected by their traditional sociocultural context which may facilitate or hinder
their success in the new global economy. This study investigates the influence
of factors in this traditional sociocultural context in the internationalisation of
Indigenous entrepreneurs.
Aim: The aim of the study was to investigate and explain the influence of three
dependent variables: locality, resource capability, and cultural capital on an
independent variable: internationalisation of SMEs in South Africa in the context
of Indigenous entrepreneurs.
Setting: The study took place in South Africa
Methods: Using an online survey, a cross-sectional quantitative study was
adopted on a sample of 72 Indigenous-owned SMEs to test hypothesised links
between locality, resource capability and cultural capital and the
internationalisation of the Indigenous-owned SMEs.
Results: The study reveals some pertinent insights in the quest by Indigenous
entrepreneurs to participate meaningfully in the new global economy. There is
strong evidence that local resources are important to Indigenous entrepreneurs
as their business leverages and benefits from these local resources and that the
local environment influences the performance of their business. This means
they tend to be influenced by their local environment in decisions to do with
participation in the new global economy. This is not a departure from literature,
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particularly the development framework and regulation theory. The study also
identifies a number of antecedents to successful internationalisation by
Indigenous entrepreneurs.
Conclusion: The research findings give credence to the efficacy of regulation
theory and the development framework. This suggests that Indigenous
entrepreneurs are not opposed to development but would like to participate in
development which is respectful of their heritage. They leverage on their
Indigenous cultural heritage and resources to enter into the new global
economy. Indigenous entrepreneurs internationalise their operations through
various entry modes such as equity and non-equity venture models but there is
growing but sparse literature on the role of strategic alliances as a preferred
mode of entry.
Description
MBA
Keywords
Small business -- South Africa. Entrepreneurship -- South Africa. Business enterprises -- South Africa.