Establishing a Creative Innovation Framework for Informal Micro–Enterprises
Keywords:
informal micro-enterprises; innovation framework; Gauteng Province; South AfricaAbstract
The existing innovation models assume an established innovation system and do not provide direct support on a practical level on what activities should be carried out in each basic innovation phase. The study sought to design a tailored creative innovation framework that can serve as a guide for informal micro-enterprises to engage in radical and incremental innovation. Through the application of sequential explanatory mixed-methods research, both quantitative and qualitative data were collected from 400 informal micro-enterprises in four townships of the Gauteng Province, South Africa. The data were analysed using descriptive statistics, correlation analysis, factor analysis, thematic, and constant comparison methods. The results reveal that informal micro-enterprises require guidance on how to engage in innovation activities throughout all basic innovation phases, which is from discovery to launch. Thus, there is a great deal of innovation-related support required in the informal sector. The study concludes that with proper guidance more informal micro-enterprises will engage in innovation activity and become sustainable. Sustainable informal micro-enterprises can create jobs and some of them will register to become formal businesses, thereby increasing the Government's tax base. A flourishing informal sector will aid in resolving South African and other developing countries' economic challenges.
References
Abdu, M., and A. Jibir. 2017. "Determinants of firms innovation in Nigeria." Kasetsart Journal of Social Sciences, 39(3): 448-456.
Amini, A., M. Torane, and L. Hernandez-Munoz. 2015. "Designing an Innovation Engine Model and a Software Tool to Meet Large Organizations Challenges with SMEs capabilities, a Pilot Study." Journal of Social and Behavioral Sciences, 195(2015): 251-257.
Arrow, K. J. 1962. "Economic Welfare and the Allocation of Resources for Invention," in National Bureau of Economic Research, The Rate and Direction of Inventive Activity: Economic and Social Factors (Princeton: Princeton University Press) (reprinted in Essays in the Theory of Risk-Bearing (1971)).
Asikhia, O. U., and M. J. van Rensburg. 2015. "SMMEs wealth creation model: a conceptual framework." African Journal of Hospitality, Tourism and Leisure, 4(1): 1-19.
Booyens, I., N. Molotja, and M. Z. Phiri. 2012. "Innovation in High-Technology SMMEs: The Case of the New Media Sector in Cape Town." Springer Science and Business media, 24(2): 289-306.
Cooper, R. G. 1993. Winning at new products: Accelerating the process from idea to launch. Addison-Wesley, Reading, Mass., 2. ed. Edition.
De Beer, J., and C. Armstrong. 2015. "Open Innovation and knowledge appropriation in African Micro and Small Enterprises (MSEs)." The African Journal of Information and Communication (AJIC), 16(2015): 2-12.
Dodourova, M., and K. Bevis. 2014. "Networking innovation in the European car industry: Does the Open Innovation model fit?." Transportation Research Part A, 69(2014): 252-271.
DSBD. 2018. Speech by Minister of small business development, Ms Lindiwe Zulu, on the occasion of the launch of UNISA enterprise and supplier development. Pretoria: Department of Small Business Development.
GEM. 2017. Global Entrepreneurship Monitor Report 2016/17. London: Global Entrepreneurship Monitor.
Georgellis, Y., P. Joyce, and A. Woods. 2000. "Entrepreneurial action, innovation and business performance: the small independent business." Journal of Small Business and Enterprise Development, 7(1): 7-17.
Gummesson, E. 2014. "Commentary on the role of innovation in driving the economy: Lessons from the global financial crisis." Journal of Business Research, 67(1): 2743-2750.
Ivers, H. 2013. Innovation in Small Firms, Select Research on Activity and Capacity. New York: Nova Science Publishers, Inc.
Izadi, A., F. Zarrabi, and F. Zarrabi.2013. "Firm-level innovation models." Journal of Social and Behavioral Sciences, 75(2013):146-153.
Jugend, D., C. J. C. Jabbour, J. A. A. Scaliza, R. S. Rocha, J. A. G. Junior, H. Latan, and, M. H. Salgado. 2018. "Relationships among open innovation, innovative performance, government support and firm size: Comparing Brazilian firms embracing different levels of radicalism in innovation." Journal of Technovation, 74-75(2018): 54-65.
Kumah, O. M. and Omilola, B. 2014. Small Business is Big Business. South Africa: UNDP.
La Porta, R., and A. Shleifer2014. "The unofficial economy in Africa." University of Chicago Press, 1(2014): 261-306.
Leedy, P. D., and J. E. Ormrod. 2014. Practical Research: Planning and Design, 10th Ed. New Jersey: Pearson Education, Inc.
Links, A. L. M., T. Hart, and P. Jacobs. 2014. "The dynamics of local innovations among formal and informal enterprises: stories from rural South Africa." African Journal of Science, Technology, Innovation and Development, 6(3): 175-184.
Marnewick, C. 2014. "Information and communications technology adoption amongst township micro and small business: The case of Soweto." South African Journal of Information, 16(1): 1-12.
Mendi, P., and R. Mudida. 2018. "The effect on innovation of beginning informal: Empirical evidence from Kenya." Journal of Technological Forecasting and Social Change, 131(2018): 326-335.
Mulibana, Lavhelesani. 2020. "Creative innovation framework for informal micro-enterprises in the townships of Gauteng Province." PhD diss., North-West University.
Pylak, K., and E. Wojnicka-Sycz. 2016. "Transforming Innovation Models to Change the Development Paths of Less-Developed Regions." Procedia Engineering, 161(2016): 2179-2183.
Remund, M. C., M. P. Ortiz, and H. J. Gehrke. 2017. "The Vitruvian Man of Leonardo da Vinci as a model of innovative entrepreneurship at the intersection of business, art and technology." Journal of Innovation and Entrepreneurship, 6(17): https://doi.org/10.1186/s13731-017-0077-9.
Republic of South Africa. 1996. National Small Business Act 102 of 1996. Pretoria: Government Printer.
Rogers, E. M. 2003. Diffusion of Innovations. 5th ed. New York: Free Press.
Rogerson, C. M. 2000. "Successful SMMEs in South Africa: the case of clothing producers in the Witwatersrand." Development Bank of Southern Africa, 17(5): 1-31.
Rose, J., M. Jones, and B. Furneaux. 2016. "An integrated model of innovation drivers for smaller software firms." Journal of Information and Management, 53(3): 307-323.
SEDA. 2012. Analysis of the Needs, State and Performance of Small and Medium Businesses in the Agriculture, Manufacturing, ICT and Tourism Sectors in South Africa. Small Enterprise Development Agency. Report number: 1.
SEDA. 2016. Accelerating SMME growth in South Africa. South Africa: Small Enterprise Development Agency.
SEDA. 2016. The Small, Medium and Micro Enterprise Sector of South Africa. Small Enterprise Development Agency. Report number: 1.
Seifried, C., M. Katz, and P. Tutka. 2016. "A conceptual model on the process of innovation diffusion through a historical review of the United States Armed Forces and their bowl games." Sport Management Review, 20(2016): 379-394.
Serrano-Santoyo, A. 2013. "Exploring a Framework for Innovation from the Perspective of Complexity Science." Procedia Technology, 9(2013):139-145.
Silviana, B. G. 2018. "Open innovation model: enabling the market uptake of innovation." Procedia Manufacturing, 22(2018): 893-899.
Smith, D. 2015. Exploring Innovation. 3rd ed. London: McGraw-Hill.
STATSSA. 2015. Quarterly Labour Force Survey. Pretoria: Statistics South Africa.
Stock, T., M. Obenaus, A. Slaymaker, and G. Seliger.2017. "A model for the development of sustainable innovations for the early phase of the innovation process." Procedia Manufacturing, 8(2017): 215-222.
TIPS. 2002. The Economics of SMMES in South Africa. South Africa: Trade and Industrial Policy Strategies.
Wagner, E. R., and E. N Hansen. 2005. "Innovation in large versus small companies: insights from the US wood products industry." Journal of Management Decision, 43(5): 837-850.
WIPO. 2013. Conceptual study on innovation, intellectual property and the informal economy. London: World Intellectual Property Organisation.
Yu, D. 2017. "The lesser known and scarier facts about unemployment in South Africa." Accessed September 04, 2017. https://theconversation.com/the-lesser-known-and-scarier-facts-about-unemployment-in-south-africa-83055.
Amini, A., M. Torane, and L. Hernandez-Munoz. 2015. "Designing an Innovation Engine Model and a Software Tool to Meet Large Organizations Challenges with SMEs capabilities, a Pilot Study." Journal of Social and Behavioral Sciences, 195(2015): 251-257.
Arrow, K. J. 1962. "Economic Welfare and the Allocation of Resources for Invention," in National Bureau of Economic Research, The Rate and Direction of Inventive Activity: Economic and Social Factors (Princeton: Princeton University Press) (reprinted in Essays in the Theory of Risk-Bearing (1971)).
Asikhia, O. U., and M. J. van Rensburg. 2015. "SMMEs wealth creation model: a conceptual framework." African Journal of Hospitality, Tourism and Leisure, 4(1): 1-19.
Booyens, I., N. Molotja, and M. Z. Phiri. 2012. "Innovation in High-Technology SMMEs: The Case of the New Media Sector in Cape Town." Springer Science and Business media, 24(2): 289-306.
Cooper, R. G. 1993. Winning at new products: Accelerating the process from idea to launch. Addison-Wesley, Reading, Mass., 2. ed. Edition.
De Beer, J., and C. Armstrong. 2015. "Open Innovation and knowledge appropriation in African Micro and Small Enterprises (MSEs)." The African Journal of Information and Communication (AJIC), 16(2015): 2-12.
Dodourova, M., and K. Bevis. 2014. "Networking innovation in the European car industry: Does the Open Innovation model fit?." Transportation Research Part A, 69(2014): 252-271.
DSBD. 2018. Speech by Minister of small business development, Ms Lindiwe Zulu, on the occasion of the launch of UNISA enterprise and supplier development. Pretoria: Department of Small Business Development.
GEM. 2017. Global Entrepreneurship Monitor Report 2016/17. London: Global Entrepreneurship Monitor.
Georgellis, Y., P. Joyce, and A. Woods. 2000. "Entrepreneurial action, innovation and business performance: the small independent business." Journal of Small Business and Enterprise Development, 7(1): 7-17.
Gummesson, E. 2014. "Commentary on the role of innovation in driving the economy: Lessons from the global financial crisis." Journal of Business Research, 67(1): 2743-2750.
Ivers, H. 2013. Innovation in Small Firms, Select Research on Activity and Capacity. New York: Nova Science Publishers, Inc.
Izadi, A., F. Zarrabi, and F. Zarrabi.2013. "Firm-level innovation models." Journal of Social and Behavioral Sciences, 75(2013):146-153.
Jugend, D., C. J. C. Jabbour, J. A. A. Scaliza, R. S. Rocha, J. A. G. Junior, H. Latan, and, M. H. Salgado. 2018. "Relationships among open innovation, innovative performance, government support and firm size: Comparing Brazilian firms embracing different levels of radicalism in innovation." Journal of Technovation, 74-75(2018): 54-65.
Kumah, O. M. and Omilola, B. 2014. Small Business is Big Business. South Africa: UNDP.
La Porta, R., and A. Shleifer2014. "The unofficial economy in Africa." University of Chicago Press, 1(2014): 261-306.
Leedy, P. D., and J. E. Ormrod. 2014. Practical Research: Planning and Design, 10th Ed. New Jersey: Pearson Education, Inc.
Links, A. L. M., T. Hart, and P. Jacobs. 2014. "The dynamics of local innovations among formal and informal enterprises: stories from rural South Africa." African Journal of Science, Technology, Innovation and Development, 6(3): 175-184.
Marnewick, C. 2014. "Information and communications technology adoption amongst township micro and small business: The case of Soweto." South African Journal of Information, 16(1): 1-12.
Mendi, P., and R. Mudida. 2018. "The effect on innovation of beginning informal: Empirical evidence from Kenya." Journal of Technological Forecasting and Social Change, 131(2018): 326-335.
Mulibana, Lavhelesani. 2020. "Creative innovation framework for informal micro-enterprises in the townships of Gauteng Province." PhD diss., North-West University.
Pylak, K., and E. Wojnicka-Sycz. 2016. "Transforming Innovation Models to Change the Development Paths of Less-Developed Regions." Procedia Engineering, 161(2016): 2179-2183.
Remund, M. C., M. P. Ortiz, and H. J. Gehrke. 2017. "The Vitruvian Man of Leonardo da Vinci as a model of innovative entrepreneurship at the intersection of business, art and technology." Journal of Innovation and Entrepreneurship, 6(17): https://doi.org/10.1186/s13731-017-0077-9.
Republic of South Africa. 1996. National Small Business Act 102 of 1996. Pretoria: Government Printer.
Rogers, E. M. 2003. Diffusion of Innovations. 5th ed. New York: Free Press.
Rogerson, C. M. 2000. "Successful SMMEs in South Africa: the case of clothing producers in the Witwatersrand." Development Bank of Southern Africa, 17(5): 1-31.
Rose, J., M. Jones, and B. Furneaux. 2016. "An integrated model of innovation drivers for smaller software firms." Journal of Information and Management, 53(3): 307-323.
SEDA. 2012. Analysis of the Needs, State and Performance of Small and Medium Businesses in the Agriculture, Manufacturing, ICT and Tourism Sectors in South Africa. Small Enterprise Development Agency. Report number: 1.
SEDA. 2016. Accelerating SMME growth in South Africa. South Africa: Small Enterprise Development Agency.
SEDA. 2016. The Small, Medium and Micro Enterprise Sector of South Africa. Small Enterprise Development Agency. Report number: 1.
Seifried, C., M. Katz, and P. Tutka. 2016. "A conceptual model on the process of innovation diffusion through a historical review of the United States Armed Forces and their bowl games." Sport Management Review, 20(2016): 379-394.
Serrano-Santoyo, A. 2013. "Exploring a Framework for Innovation from the Perspective of Complexity Science." Procedia Technology, 9(2013):139-145.
Silviana, B. G. 2018. "Open innovation model: enabling the market uptake of innovation." Procedia Manufacturing, 22(2018): 893-899.
Smith, D. 2015. Exploring Innovation. 3rd ed. London: McGraw-Hill.
STATSSA. 2015. Quarterly Labour Force Survey. Pretoria: Statistics South Africa.
Stock, T., M. Obenaus, A. Slaymaker, and G. Seliger.2017. "A model for the development of sustainable innovations for the early phase of the innovation process." Procedia Manufacturing, 8(2017): 215-222.
TIPS. 2002. The Economics of SMMES in South Africa. South Africa: Trade and Industrial Policy Strategies.
Wagner, E. R., and E. N Hansen. 2005. "Innovation in large versus small companies: insights from the US wood products industry." Journal of Management Decision, 43(5): 837-850.
WIPO. 2013. Conceptual study on innovation, intellectual property and the informal economy. London: World Intellectual Property Organisation.
Yu, D. 2017. "The lesser known and scarier facts about unemployment in South Africa." Accessed September 04, 2017. https://theconversation.com/the-lesser-known-and-scarier-facts-about-unemployment-in-south-africa-83055.
Published
2021-02-10
How to Cite
Mulibana, L., & Rena, R. (2021). Establishing a Creative Innovation Framework for Informal Micro–Enterprises: Array. Acta Universitatis Danubius. Œconomica, 17(2). Retrieved from https://dj.univ-danubius.ro/index.php/AUDOE/article/view/791
Issue
Section
Business Administration and Business Economics
License
The author fully assumes the content originality and the holograph signature makes him responsible in case of trial.
