Stimulating Entrepreneurship and Innovative SME’s in a National Economy

BOHRInternationalJournalofFinancialMarketandCorporateFinance 2021,Vol.1,No.1,pp.40–44 https://doi.org/10.54646/bijfmcf.008 www.bohrpub.com

StimulatingEntrepreneurshipandInnovativeSME’s inaNationalEconomy

NikodemusAngula1 andFayeKandjeo2

1UniversityofNamibia,FacultyofHealthScience,SchoolofMedicine,HageGeingobCampus,Bach, StreetWindhoek,Namibia

2UniversityofNamibia,FacultyofCommerce,Management&Law,Windhoek,Namibia

E-mail:chcangula@gmail.com/angulan@unam.edu.na;fkandjeo@unam.na

Abstract. ThestudywasaimedtoexploretheinnovativeandinclusivelocalentrepreneurshipandSMEdevelopmentinNamibia.Thestudyusedqualitativemethodsasaresearchstrategy.Meaningqualitativedatawascollected andanalysedusinginterpretivetechniquesthroughthedistributionofgoogleformlinktoSMEsownerinthe14 regionofNamibia.ThefindingsofthestudyrevealedthatNamibiaSMEs’sownerhadnoknowledgeinSMEsnetworkingwithotherSMEsinthe14region.Theparticipantsfurtherindicatedthereisnonetworkplatformamong SMEsinNamibiathatshareinformationregardingSMEsgrowthanddevelopment.Accordingtotheparticipants engagedinthestudytheyindicatedthatsince1990somearestilloperatingthesamewayandthereisnopartnership withotherSMEsinthe14regionsofthecountrysinceindependence.Therefore,thepresentstudyrecommendsthat MinistryoftradeshouldcomeupwithstrategiesandmechanismthatcanempowerSMEsownertosharebusiness ideas,networkingandcreatepartnershipwithotherSMEsinthe14regionsofNamibiaandthestudyfurtherrecommendsthattheMinistryofTradeshouldcomeupwithSMEsannualconferencemeetingthatwouldenableSMEs ownertoattendandsharebusinessideasandbeabletocompeteatgloballevel.

Keywords: Entrepreneurship,InnovativeSME’s,Nationaleconomy.

INTRODUCTION

SMEs(SmallandMedium-SizedEnterprises)areknown asthebackboneofaneconomy,andtheycontributetoa country’slocaleconomicdevelopmentbycreatingjobpossibilities[7].Currently,traditionalentrepreneurshiphas beenanorderofthedayinsmallmediumenterprisesin Namibiaandtheworldiscurrentlymovingawayfrom suchtrends.Henceforththeneedtorecognizeavarietyof processmodelswhichhavebeendevelopedinthecurrent literature.Numberofauthorssuggestedthatinnovation compriseofdifferentphasesbutnotlimitedtomanufacturing,prototypeproductionanddevelopment,research design,ideageneration,marketingandsales(Dooleyand O’Sullivan,2001;Knox,2002;PooltonandIsmail,2000; Rothwell,1994).Philosophers,ontheotherhand,lamented thatthereismoretoinnovationthantheprocedure(Amabile,1996;Couger,1995).Thus,innovationhasvarious facesandtakesmanyshapes.Themostprominentforms ofinnovationcanberepresentedasdualisms:radicalvs

incremental;productversusprocess;andadministrative againsttechnological(Cooper,1998).Bothdramaticand incrementalinnovationarepossible.Pathbreaking,discontinuous,revolutionary,original,pioneering,fundamental, orimportantinnovationsareexamplesofradicalinnovations(Greenetal.,1995).Incrementalinnovationsare incrementalchangesmadetoimproveandextendexisting processes,goods,andservices.

Regrettably,sinceIndependence,Namibiahasexperiencedmodestindustrialdevelopmentsinceindependence andcontinuestoimportthemajorityofmanufactured goods,primarilyfromSouthAfrica.(GersonKadhikwa& VitalisNdalikokule,2007).Itisagainstthisbackground thatthissituationhasledtotraditionalentrepreneurship ofsellingmanufacturedgoodsfromneighboringcountries ofwhichminimalmark-upsareaddedtoensuresurvival ofentrepreneursinNamibia.Inattempttoestablishing aparadigmforprospectingandfosteringpublic-sector innovations;theNamibiangovernmenttaskthecityof windhoekasapublicenterpriseandthisisevidentby

theinadequatevarietyofmanufacturedproductswhich thecountryisabletoexportandmarket,henceforththis researchpaperaimstodevelopanSMEinnovativemodel inNamibia.

PROBLEMSTATEMENT

NamibiapublicsectorpolicyonInnovation(Officeofthe PrimeMinister,2020,pxiv)containsthatthedevelopment anddeploymentofnewgoods,processes,practises,and servicesthataddvaluetoabusiness,economy,orcountryisreferredtoasinnovation.Itthereinfurtherpositsthat anyprogressivegovernmentholdthataknowledgebased societyisawell-educatedsocietythatreliesonitsinhabitants’knowledgetodriveinnovation,entrepreneurship, andtheeconomicdynamicsofthesociety.Meanwhile, Theabilitytogenerateuniqueandusefulitemsorknowledgeisreferredtoasinnovationcapability(Zheng,Liu,& George,2010).AccordingtoLawsonandSamson(2001), innovationcapabilityisdefinedas“theabilitytocontinuouslyturninformationandideasintonewproducts, processes,andsystemsforthebenefitoftheorganisation anditsstakeholders”.Opportunitiesforanentrepreneur includetheintroductionofnewitemsorservicesintothe marketvianovelwaysorconcepts(Eckhardt&Shane, 2003,p.336).Similarly,possibilitiesmayexisttoengage inactivitiesthatarenoveltothefirm.Itiscriticalfor smallbusinessestobeabletorecognisetheseopportunitieswhentheyariseinordertoexpand[5].Namibia’s mainimportpartner(66percentoftotalimports)isSouth Africa,followedbytheNetherlands,theUnitedKingdom,andChina(TrendEconomy,2021).Underpinning entrepreneurshipandinnovationsuccessofthelocalities istheaccessibilitytoinformationaboutnetworkingopportunities,SMEs’participationinresearchnetworksand technologymarketplaces,theamountofsupport,theestablishmentandpreservationofinnovativeclustersinthe community,andSMEawarenessandknowledgeofintellectualpropertysystemelements.Hencetheneedtostudy howtheaforementionedconditionscontributestostimulatingentrepreneurshipandinnovativeSMEsinanational economy.

AIMANDOBJECTIVES

Themainobjectiveofthisresearchwastoexplorethe innovativeandinclusivelocalentrepreneurshipandSME developmentinNamibia.

SpecificObjectives

• AnalyseifSMEsinthelocalityhasaccesstoinformationaboutnetworkingopportunities

• ExploretowhichextendSMEsparticipatesintechnologymarketsandresearchnetworks

• Establishthelevelofsupport,theformationand preservationofinnovativeclustersinthecommunity

METHODOLOGY

Thestudyemployedacasestudyapproachthatenabled theresearchertohaveanin-depthexaminationofaparticularunitofanalysis.Thestudyselectedacasestudy approachsimplybecausethishelpedthestudytoconcentrateongatheringknowledgeaboutacertainobject, event,oractivity,suchasaspecificbusinessunitororganisation[1].Thestudyusedqualitativeresearchmethod asaresearchstrategy,meaningthatqualitativedatawas collected.Thisismostlyduetotheexpressivenatureof qualitativedataandtheopinionsofinvolvingactors.The qualitativeresearchapproachwaschosenpartlybecause itallowsresearcherstocollectdataonindividuals’and groups’subjectiveideasandopinions.Thistypeofdata wasusedtounderstandmoreoninnovativeandinclusive localentrepreneurshipandSMEdevelopmentinNamibia.

Thequalitativedatawascollectedusingsemi-structured interviewprimarilybecauseitenabledthestudytogetrich datafromparticipants’insightfulviewsandopinions[9]. Asthiswillbedonefacetoface,thesemi-structuredinterviewtechniqueallowedforflexibilitythroughoutdatacollection,includingquickprobingofparticipants’answers. Theinterviewerhastheoptiontorestructureandrephrase questionsduringtheinterview,accordingto[3].Thequalitativedatawasanalysedusinginterpretivetechniques becauseitallowedthestudytogothroughthestepsof howthedatacollectedwasanalysedstepbystepbyreduction,whichisananalyticprocessinwhichthequalitative datagatheredbytheresearcherisreduced,rearranged,and integratedtoformtheory[2].

LITERATUREREVIEW

Thereviewofliteraturecoversawiderangeoftopics, includinglocalitySMEs’accesstoinformationaboutnetworkingopportunities,SMEs’participationinresearch networksandtechnologymarkets,thelevelofsupport,the emergenceandmaintenanceofinnovativeclustersinthe locality,andSMEawarenessandknowledgeofintellectual propertysystemelements.

LocalitySMEsAccessibilitytoInformation aboutNetworkingOpportunitiesinNamibia

Becauseoftherapidrateoftechnologydevelopment, shortenedproductlifecycles,andmarketglobalisation duringthelastdecade,theattentiononorganisations’ abilitytoinnovatehasonceagainbeenacrucialfocal point.Evenwhilealimitednumberofextremelylarge corporationscontinuetodominateprivateR&Dspending,

disruptiveinnovationsfrequentlyoriginatefromsmalland medium-sizedorganisations(SMEs)[8].

SMEsParticipationinResearchNetworksand TechnologyMarketsinNamibia

Existingliteraturehasexploredthesignificanceofnetworksinassistingandboostingtheinternationalisation processofsmallandmedium-sizedbusinesses[10].For example,networkingcanhelpSMEscompeteattheworldwidelevelbyestablishing“symbiotic”partnershipswith largerenterprises(Etemadetal.,2001).Networkingcanbe animportantmeansofgettingexpertiseorlearningabout internationalopportunities,whichcanencourageSMEsto exploreinternationalmarkets(AndersenandBuvik,2002; Ellis,2000;SharmaandJohanson,1987).Differentnetworkingtacticsareusedbyvariousindustries,governments, agencies,andotherenterprisesthathaveaidedtheinternationalisationprocess(Rickne,2006;Westerlundetal.2008), demonstratingthatthenetworkviewpointisusefulfor analysing“why”and“how”firmsinternationalise(JohansonandMattsson,1988).

TheLevelofSupport,Emergenceand MaintenanceofInnovativeClusters intheLocality

Economicperformanceisprimarilydrivenbyinnovation[4].Firmsmakeadeliberatedecisiontoinnovate. However,itappearsthatthegeographicallocationof innovationiscriticalforinnovativeperformance.Specific innovationclusters,globaleconomichotspotswithexceptionalinnovationdynamics,haverecently,andsometimes unexpectedly,developedinanumberoflocationsaround theworld(Engel,2015).Thereisaspatialdimensionof innovation.Formorethanacentury,thebenefitsofspecialisedconcentrationsofenterpriseshavebeenexplored vianumeroustheoreticallenses,withoriginsintheconcept ofindustrialdistricts(Marshall,1920).Similarly,possibilitiesmayexisttoengageinactivitiesthatarenoveltothe firm.Itiscriticalforsmallbusinessestobeabletorecognisetheseopportunitieswhentheyariseinordertoexpand [5].Theaimofthisresearchwastoexplorertheinnovative andinclusivelocalentrepreneurshipandSMEdevelopment:AcasestudyaboutNamibia.AnalyzeifSMEsin thelocalityhasaccesstoinformationregardingnetworking events.ThespecificobjectivesofthestudyweretoExplore towhichextendSMEsparticipatesinresearchnetworks andtechnologymarkets,toEstablishthelevelofsupport, emergenceandmaintenanceofinnovativeclustersinthe locality,toIdentifyandsuggestbestpracticesaimedatsupportingcompanyinnovationthroughclusterdevelopment andtoAssessSMEawarenessandknowledgeofelements ofintellectualpropertysysteminNamibia.

SMEAwarenessandKnowledgeofElementsof IntellectualPropertySystem

IPanditswortharefrequentlyundervalued.Intoday’s increasinglyknowledge-driveneconomy,intellectual property(IP)isacriticalissueinday-to-daybusiness decisions[11].Newproducts,brands,anduniquedesigns arriveonthemarketpracticallydailyasaresultofongoing humaninnovationandcreativity.Smallandmediumsizedfirms(SMEs)arefrequentlyattheforefrontofsuch advances(Saleh,2008).However,theirinnovativeand creativetalentisnotalwaysfullyutilisedbecausemany SMEsareunawareoftheintellectualpropertysystemor theprotectionitcanprovidefortheirinnovations,brands, anddesigns(WIPOMagazine,2005).

SMEs(SmallandMedium-SizedEnterprises)areknown asthebackboneofaneconomy,andtheycontributetoa country’sregionalgrowthbycreatingjobopportunities[7]. Theydifferfromhugecorporationsintermsofsizeand resources(financial,humanetc.)Winningoverclientsis difficultinaworldwherecompaniesarebusyintroducingnewproductsandservicesofcompetitioninattempt toleadthemarket.Similarly,therearemanyopportunities,andanentrepreneur’sresponsibilityistoseizethose opportunitiesandactonthem(Bergh,2009,p.8).Opportunitiesforanentrepreneurincludetheintroductionofnew itemsorservicesintothemarketvianovelwaysorconcepts(Eckhardt&Shane,2003,p.336).

ConceptualFramework

Thissectiondescribestheanalyticaltoolwithseveralvariationsandcontexts.Besides,theconceptualframework enabledthisstudytomakeconceptualdistinctionsandto organiseideas.

Figure1. ConceptualframeworkforNamibiaSMEsinnovation strategies.

Source:Researcher’sownconceptualization.

Figure 1 depictstheconceptualframeworkthatarticulatesthelinkbetweentheindependentanddependent variables.

BUSINESSBENEFITS

IntheNamibiansetting,SMEsplayanimportantrolein thelocaleconomybycreatingalargenumberofjobpossibilitiesacrossthe14regions,aswellasagroupofskilled andsemi-skilledpeopletosupportfutureindustrialand businessexpansioninthecountry.

DISCUSSIONOFRESULTS

Thedataobtainedweremanuallyanalyzedusing interpretivetechniques.Descriptivestatisticswasused toscrutinizefindingsfromaconsistentresearchtools. Non-numeric,percentagesandtableswereusedtopresent theoutcomes.

Table1:AgeDistributionofParticipants

18–2526–3536–4546and YearsYearsYearsaboveTotal Age 5573 20

Percentages 25%25%35%15% 100%

Anagedistributiontableshowsthattheparticipant’s sampleoftheSMEsinthe14regionofthecountrywho participatedinthedatacollectionregardingSMEsinthe localityhasaccesstoinformationaboutbusinessnetworkingopportunities.About25percentofthesamplestudy wasbetweentheagesof18–25yearsofage,another25percentwerewithintheageof26–35yearsofage,35percent werebetweentheageof36and45yearsand15percent were46yearsageandmore.

Table2:GenderDistributionoftheParticipants

MaleFemaleTotal

Gender 713 20

Percentages 35%65% 100%

GenderrepresentationsuggeststhattheSMEsownerin the14regionofthecountrywererepresentedbyfemale asthedominantparticipantsaspresentedinTable2.Itis demonstratesthat35percentofthestudyparticipantswere maleSMEsownerwhiletheremainingparticipantof65 percentwerefemalesSMEsowner.Thegenderdispersion therefore,proposedthattheSMEsownerinthe14regionof thecountryisfemaledominatedintheSMEsnetworking thanthatofthemalecounterpart.

Table3:ExperienceofManagement

0–56–1011and YearsYearsaboveTotal Years 4106 20 Percentages 20%50%30% 100%

TheworkexperienceasdistributedinTable3above indicatestheworkexperienceoftheparticipantsinthe study.About20percentoftheparticipantshad5yearsor lessofworkingexperience,andwhile50percenthavea workingexperienceofbetween6and10years.Theremaining30percentoftheparticipantshad11experienceor moreyears.ThetablethussuggeststhattheSMEsowner hadnoknowledgeinSMEsnetworkingwithotherSMEs intheregion.Theparticipantsfurtherindicatedthereis nonetworkplatformamongSMEsinNamibiathatshare informationregardingtheSMEsgrowth.Accordingtothe participantsengagedinthestudytheyindicatedthatsince 1990somearestilloperatingthesamewayandthereisno partnershipwithotherSMEsinthe14regionsofthecountrysinceindependence.

Table4:QualificationsoftheParticipants

CertificateDiplomaDegreeMastersPhDTotal Qualifications 00000 0 Percentages 0%0%0%0%0% 0%

Table4abovedemonstratesthatamongsttheparticipantsnoonewasaholdersofcertificates,nopercentof theparticipantswereDiplomaholders,while0percentof theparticipantshadnoDegreesorneither0percenthad Masters’Degreesholders,andtherewasnoaPhDholder amongtheparticipants.TheabovetablerepresentsSMEs ownerwhowereengagedinthestudynoneofthemhave aqualification.

Piechart1:SMEsownerresponserate owner's PieChart

Apiechartabovedemonstratesthat75percentoftheparticipantsinthestudystronglydisagreedthatthereisno networkingandpartnershipamongSMEsinNamibiain

the14regionofthecountry.Although25percentofthe participantagreedthattherenetworkingandpartnership amongSMEsinNamibiatherewasnoclearempiricaldata availedtothestudyfromtheSMEsownerastohowtheir BusinessescollaboratewithotherSMEsinthe14regionof Namibia.

THESMEsNETWORKINGOPPORTUNITIES INTERMSOFACCESSTOINFORMATION INNAMIBIA

Theparticipantsindicatedthatthecurrentmethodsused bySMEsnetworkingopportunitiestoaccessinformation amongSMEsownerinNamibiaaresocialmediaandNBC whichdonotclearshownecessaryinformationrequired bytheSMEsowner.

SMEsParticipatesinResearchNetworksand TechnologyMarketsinNamibia

Theparticipantsrevealedthatthereisopportunityamong SMEsinthe14regionofNamibiatoparticipateinresearch networksandtechnologymarketsinNamibia.TheSMEs ownerworksinisolation.

TheLevelofSupport,EmergenceandMaintenanceofInnovativeClustersinNamibia

Theparticipantspostulatedthatthelevelofsupport,emergenceandmaintenanceofinnovativeclustersinNamibia isveryextremelylow,nomuchsupport,onlyNCCIbutthe levelofsupportisnon-existent.

TheBestPracticesAimedatSupportingCompanyInnovationthroughClusterDevelopment inNamibia

TheparticipantsstatedthatthebestpracticestosupportSMEsinnovationisthroughSMEsengagementat thenationallevel,throughtechnologyinnovationtohelp SMEsandthroughimplementingstrongsupporttoSME’s bycreatingnewentitiesaimedatteachingandcreating awarenesstoSME’s.

SMEAwarenessandKnowledgeofElementsof IntellectualPropertySysteminNamibia

TheparticipantssuggestedthatSMEsawarenessand knowledgeonintellectualpropertyinNamibiaisvery low,notmanyunderstands,havenoidea,notsureand awarenessandknowledgeregardingintellectualproperty systeminNamibiaisnon-existentandmoreeducationis needed.Bipacancreateadepartmentaimedatteaching currentandupcomingSME’swithrelevantinformation.

THESTUDY’SRECOMMENDATION

• ThestudyrecommendsthatMinistryoftradeshould comeupwithstrategiesandmechanismthatcan empowerSMEsownertosharebusinessideas,networkingandcreatepartnershipwithotherSMEsin the14regionsofNamibia.

• TheMinistryofTradeshouldcomeupwithSMEs annualconferencemeetingthatwouldenableSMEs ownertoattendandsharebusinessideasandbeable tocompeteatgloballevel.

CONCLUSIONS

Intoday’sworld,SMEsareregardedasthebackboneof aneconomy,contributingtoacountry’sregionalgrowth throughjobpossibilities.SMEsplayamajorroleinmany Africancountriesastheyprovidejobopportunitiestocitizenofanycountryacrosstheglobe.DespiteSMEsare crucialinthedevelopmentofmanydevelopingcountries, theyfacechallengeofgrowthandnetworkingwithother SMEsoperatinginthesameenvironment.

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