The influence of selected process–related factors on business success
Wright, Frances Ray.
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Successful entrepreneurship can be a major contributor to the alleviation of poverty and creation of employment opportunities. This study, through literary research and a mixed method, qualitative and quantitative empirical research, focussed on the identification of process–related factors impacting on Perceived business success and measuring the effect thereof on the Perceived business success of the participating businesses. Factors measuring Perceived business success were identified in order to develop a measure of business success. Independent variables impacting on Perceived business success were classified into four different categories. The categories are Entrepreneurial abilities as measured through Entrepreneurial attributes, Leadership ability and Strategic ability, the Macro environment as measured through Political stability and Competitive landscape and the Micro environment consisting of Business management processes measured through Human resource management, Supply chain management, Quality management and Financial management. The Micro environment also includes Support received by the entrepreneur and Market interaction which is measured through Marketing and Customer relationship management. The fourth category is Business process management which comprises of two factors, Business process infrastructure as measured through Business location, Facility layout and Technology utilisation. Business process management is measured through Human resource management processes, Supply chain management processes, Quality management processes, Financial management processes and Production processes. The measures for the dependent variable, Perceived business success are Sustainability, Business growth, Profitability and Customer satisfaction. The effect of each of the independent variables on each of the measures of Perceived business success as the dependent variable were measured through 20 linear regression coefficients after the dependent variable was proven reliable and valid through drawing of a pattern matrix of Oblimin rotated–principal component factor analysis. Reliability and validity of the independent variables were established through Chronbach alpa coefficients, Kaiser–Meyer–Olkin measures of sampling adequacy and Bartlett’s test of sphericity. The measurement instrument utilised in this study was proven to be reliable and valid. The study was based on a sample of 308 respondents that completed a structured questionnaire and 20 interviews with owner–managers for qualitative research. The majority of the respondents were between the ages of 40 and 59 and 76.8% of the respondents were male. Respondents were mostly educated, with 23.4% having post–matric qualifications. Most of the businesses had between 11 and 25 employees, but the sizes of businesses ranged between five and 200 employees. The ages of businesses ranged from start up to businesses that have been in existence for more than 30 years. Most businesses were private or closed corporations and turnovers ranged from under R2 000 000 (two million rand) to R1 000 000 000 (one hundred million rand). Through the qualitative research it was found that there is no universal component of Perceived business success identified in the market, but that most entrepreneurs believe that human resources and a cohesive team are major contributors to Perceived business success. It was also found that the correct Utilisation of technology is a significant contributor to Perceived business success. During the empirical research it was found that significant relationships exist between Leadership abilities, the Competitive landscape and Perceived business success. It was also found that Political stability does not have a significant impact on Perceived business success. With regards to business management, Human resource management and Quality control will enhance Perceived business success. Surprisingly, Support received does not have a major impact, but Marketing and Customer relationship management are important factors. When researching Business process management it is found that Facility layout, Technology utilisation, Human resources, Quality management and Financial management processes are the most significant. Both primary and secondary objectives were met and all research questions were answered. All criteria were met to ensure the research was conducted according to research principles. Through the research, entrepreneurs in South Africa can gain insight into the creation of entrepreneurial success as well as the measurements of Perceived business success in order to predict outcomes accurately. It is recommended that future research should include how the significant variables can be applied in order to enhance business success and entrepreneurship in general.