Problems facing governance of small business in South Africa: non-owner perspective

Small businesses have been perceived to have governance problems in South Africa. The problem is that in SA there is a limited amount of research available regarding these complex investigations into the problems of governance of SMEs in South Africa. The objectives of this study were to conduct an extensive literature review on governance of small businesses, and the factors which affect the governance of such small businesses and what key resources could be identified and built up for the successful adoption of innovations in the sector, to lead to an understand of weaknesses in the current capacity-building of SMEs. It also sought to determine the current situations contributing to the weaknesses of SMEs; to understand challenges in the governance of small businesses in South Africa, to determine the types of financial support that exists and the contribution of financial support to the development of SMEs and to understand the ways government can help and develop SMEs. Qualitative research was used because it is more subjective and relies on experiences and opinions of participants. The study used exploratory research. An interview protocol for semi-structured face-to-face interviews was designed and used to obtain the views of SME owners and managers. The findings of the study showed that a lack of financial support is one of the challenges in the current capacity-building of small businesses. Moreover, the findings of the study showed that access to information on available markets and on the creation of new opportunities is another weakness in the current capacity-building of small businesses. SMEs need access to buyers, information on product demand, pricing knowledge and standards. The findings of the study also showed that the lack of support through business management knowledge is one of the weaknesses in the current capacity-building of small businesses. The findings showed that, most small business owners do not have the needed business management knowledge to transform their businesses. The study recommends that the government assist small businesses with financial support. It is also suggested that small businesses have human resource management knowledge to manage people who help them develop their businesses. Moreover, the study recommends that small businesses embrace new technology to boost their business by easy operations using new technologies. Moreover, the study recommends that small businesses owners use the same strategies, approaches and novel technology to compete with other businesses all over the world since there is fierce competition due to globalization.Thesis (MBA) -- Faculty of Business and Economic Sciences, Business Administration, 202