Assessing public value from the Department of Small Business Development’s export promotion programme

Swanepoel, Daryl Wade (2018-12)

Thesis (MPA)--Stellenbosch University, 2018.

Thesis

ENGLISH SUMMARY : The South African Department of Small Business Development (DSBD) facilitates small and micro-enterprises’ (SME) participation in trade exhibitions abroad, using Trade and Investment South Africa (TISA) as implementing agent. In this way, it intends to help SMEs succeed in the export market. This research primarily aimed to assess the public value derived from expending taxpayer resources on these endeavours. Public value was assessed in terms of (i) contribution to the SMEs’ growth in export turnover, and (ii) development of the SMEs’ export capacity. A secondary examination was devoted to (i) the role of export-readiness selection criteria in the success or failure of the outbound trade missions programme for SMEs, and (ii) searching for alternative export promotion techniques that may augment DSBD’s current practices so as to create greater public value. Twenty SMEs who had participated in TISA-organised national pavilions abroad from 2014 to 2016 were selected. To address the primary research question, data was obtained through personal interviews with the enterprises. Enterprise Ireland’s export-readiness checklist provided the basis for determining the degree of improvement in these SMEs’ export capabilities pre-mission to post-mission. Moving to the secondary study, the widely supported characteristics of an export-ready SME as defined by Pickernell (2016) were used as a benchmark to assess DSBD’s criteria for enlisting SME participation. In search of possible alternatives for DSBD to consider, a literature search and subsequent study visits were conducted. Regarding export growth, the research found that reasonable public value was derived as a result of the SMEs’ participation in the national pavilions. When including SMEs’ own efforts, public value improved considerably. However, in terms of improving the SMEs’ export capabilities, the research revealed complete public-value failure on the part of DSBD/TISA, as no improvement could be ascribed to their efforts. On the question of selection criteria, the research confirmed the validity of the Pickernell characteristics, having – for the most part – been present in all but one of the enterprises that had registered material export growth. On the other hand, enterprises that had failed to register exports, also failed to display the Pickernell characteristics. Whilst there was near perfect compliance in TISA’s adherence to its own selection criteria, TISA set very low standards compared to those of Pickernell. In searching for alternative models for DSBD to consider, the study discovered six internationally proven export promotion techniques. All six contain elements that could help address the identified deficiencies in DSBD/TISA’s current practices. The research concludes with a number of recommendations aimed at enhancing DSBD’s offering and the public value it creates. These include the continuation of national pavilions, though with added measures to support enterprises with the proven ability to generate export sales. It is also recommended that TISA’s selection criteria be aligned with the Pickernell characteristics, and that their exhibition selection methodology be revised. Finally, DSBD would be well advised to augment their current practices with a more holistic SME export promotion technique, for which a concept is provided to aid further in-depth research, modelling and testing.

AFRIKAANSE OPSOMMING : Die Suid-Afrikaanse Departement van Kleinsakeontwikkeling (DSBD) fasiliteer klein en mikro-ondernemings (KMO’s) se deelname aan handelskoue oorsee, met Trade and Investment South Africa (TISA) as implementeringsagent. Sodoende wil DSBD dié ondernemings die uitvoermark suksesvol help betree. ’n Primêre oogmerk van hierdie navorsing was om te bepaal hoeveel publieke waarde geskep word deur belastingbetalersgeld aan hierdie inisiatiewe te bestee. Publieke waarde is gemeet aan die hand van (i) die bydrae tot groei in die KMO’s se uitvoeromset, en (ii) die ontwikkeling van die KMO’s se uitvoervermoë. ’n Sekondêre ondersoek is gewy aan (i) die rol van uitvoergereedheidskriteria in die sukses of mislukking van die uitwaartse handelsendingsprogram vir KMO’s, en (ii) ’n soektog na alternatiewe uitvoerbevorderingstegnieke ter aanvulling van DSBD se huidige praktyke ten einde groter publieke waarde te skep. Twintig KMO’s is gekies wat van 2014 tot 2016 aan TISA-georganiseerde nasionale uitstallings oorsee deelgeneem het. Om die primêre navorsingsvraag te ondersoek, is data deur persoonlike onderhoude met die ondernemings bekom. Enterprise Ireland se kontrolelys vir uitvoergereedheid het die grondslag gebied om te bepaal in watter mate hierdie KMO’s se uitvoervermoëns van voor tot ná hulle deelname verbeter het. Vir die sekondêre studie het Pickernell (2016) se kenmerke van ’n uitvoervaardige KMO, wat wyd ondersteuning geniet, as rigpunt gedien vir die beoordeling van die kriteria waarvolgens DSBD ondernemings vir deelname kies. In die soeke na moontlike alternatiewe wat DSBD kan oorweeg, is ’n literatuurstudie en daaropvolgende buitelandse studiebesoeke onderneem. Met betrekking tot uitvoergroei bevind die navorsing dat redelike publieke waarde geskep is na aanleiding van die KMO’s se deelname aan die nasionale uitstallings. Wanneer groei weens KMO’s se eie pogings ingesluit word, verbeter publieke waarde aansienlik. Wat die verbetering van KMO’s se uitvoervermoë betref, toon die navorsing egter dat DSBD/TISA geheel en al misluk het om publieke waarde te skep omdat geen verbetering aan hulle pogings toegeskryf kon word nie. Op die vraag oor keuringskriteria bevestig die navorsing die geldigheid van die Pickernell-kenmerke, wat op een uitsondering na grotendeels teenwoordig was by al die ondernemings wat beduidende uitvoergroei aangeteken het. Daarteenoor het ondernemings wat nié uitvoere kon bewerkstellig nie, ook nie oor die Pickernell-kenmerke beskik nie. Hoewel TISA se voldoening aan hulle eie keuringskriteria byna foutloos blyk te wees, stel hulle uiters lae standaarde vergeleke met dié van Pickernell. Om DSBD van alternatiewe modelle vir moontlike oorweging te voorsien, stel die studie ses internasionaal bewese uitvoerbevorderingstegnieke voor. Elk bevat elemente wat die geïdentifiseerde tekortkominge in DSBD/TISA se huidige praktyke kan help oorbrug. Die navorsing sluit af met ’n aantal aanbevelings ter versterking van DSBD se aanbod en die publieke waarde wat dit skep. Dít sluit in die voortsetting van nasionale uitstallings, dog met bykomende maatreëls ter ondersteuning van ondernemings met die bewese vermoë om uit te voer. Daar word ook aanbeveel dat TISA hulle keuringskriteria met die Pickernell-kenmerke versoen, en hulle metodologie vir die keuse van skoue hersien. Laastens is dit gerade vir DSBD om hulle huidige praktyke met ’n meer holistiese uitvoerbevorderingstegniek vir KMO’s aan te vul, waarvoor hierdie navorsing ’n konsep voorsien om verdere diepgaande studie, modellering en toetsing te ondersteun.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/104924
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