The Macroeconomic Landscape of Post-Apartheid South Africa: A Critical Review of the Effect of the Broad-Based Black Economic Empowerment (BBBEE) Program on the Success of Female SMEs Operators

Abstract

Previous business research has highlighted the impact of government policy in the processes of formulating business strategies and in the decision-making process of organizations. In the South African context, a review of this impact on organizational strategy is for the most part important especially after the fall of apartheid as businesses have been saddled with widespread institutional change the purpose of which is to redress historic inequalities that characterized the apartheid regime. Specifically, the introduction of a far-reaching B-BBEE policy aimed at increasing participation of PIDs in economic activities. Previous researchers have been focused on the impact of B-BBEE policy on mergers and acquisitions, strategic decisions and value chain structures, as well as ROEs. The current report from STATS-SA indicates that the failure rate for women-owned businesses remains at a high rate despite the implementation of the B-BBEE policy. Therefore, research on the impact of B-BBEE on business strategy and success of female SMMEs operators may provide an accurate and deep understanding that will be beneficial to policymakers because of the social pressures to emphasis more on a 'broad-based' BEE (B-BBEE) policy aimed at increasing the participation of the black population (and in particular women) in economic activities as well as increasing the number of black ownership in businesses or creating employment for the black population. This study used appropriate data tools and techniques to analyze the data drawn from a sample of female entrepreneurs in South Africa. The study applies culturally instantiated facets of the debate on gender entrepreneurship as part of a detailed and empirically sophisticated consideration of the status of female entrepreneurship within South Africa. This paper involves an in-depth survey using the ten dimensions of business performance as a basis to study small South African women-owned businesses given that the approach is useful in the development of a theory in fields where not much research has been undertaken. The businesses studied for this research are based on a setting where B-BBEE program is a principal factor in the strategic framework of the South African female business owner. This paper contributes to existing literature on the implications of the B-BBEE program on SMEs by studying the relationship between business strategies, outcomes, and the B-BBEE program.

DOI: 10.5901/jesr.2017.v7n1p145