Assessing managerial competencies of small enterprises in Okhahlamba Local Municipality.

Abstract

Small Micro and Medium Entreprises (SMMEs) are amongst the programmes that were unveiled by government just after first democratic elections in 1994. They were identified by a government as the essential tool to address some socio-economic challenges such as poverty eradication, unemployment and SMMEs were also tipped as a vital tool to address the high level of economic inequalities in the society. In the past 25 years government has initiated number of programmes to support SMMEs, however the failure rate of small businesses is very high especial those SMMEs that are based in rural areas. This study intended to assess the managerial competencies amongst the SMMEs that are based in Okhahlamba Local Municipality. The main objective of the study was to assess whether the SMMEs ownersmanagers do have adequate skills to manage their businesses successfully. The literature looked at all SMMEs support structures, legislations, factors that lead to SMMEs failure and also looked at five managerial competencies in relation to the management of small businesses. The literature revealed that the failure of SMMEs can be attributed to the lack of managerial competencies to its owners-managers. The simple random sampling was used to sample the respondents in this study. A total of 120 questionnaires were distributed to SMMEs ownersmanagers and total of 116 questionnaires were collected from the respondents. The data was analysed using Statistical Package for Social Science (SPSS), hence the descriptive and inferential statistics were used to analysed the data. The key finding was that SMMEs ownersmanagers are aware of managerial competencies that they should have, but the majority of them seem to be lacking these managerial competencies. The study revealed that those SMMEs owners-managers with formal qualifications after matric they seem to be doing well in their business as compared to those who do not have formal qualifications. The study recommended that the Okhahlamba Local Municipality and other agencies that are involved in the SMMEs development should pay more attention on assisting these small businesses owners-managers to develop managerial skills. A close mentorship is also recommended particularly those SMMEs that has been operational for less than two years.