Factors influencing strategic decision-making in South African small businesses

Abstract

Orientation: Good strategic decision-making (SDM) is vital for continuous long-term business performance and sustainability.

Research purpose: This study aimed to determine the influencing factors of SDM in small-, medium- and micro-enterprises (SMMEs) and how they relate to each other.

Motivation for the study: Strategic decision-making literature for SMMEs is underrepresented, particularly in South Africa. This article addressed this gap by investigating these factors, thereby improving the current understanding of SDM and enhancing environmental scanning and effective SDM in SMMEs.

Research design, approach, and method: A qualitative approach was adopted, implementing the interactive qualitative analysis (IQA) research technique involving a focus group session and interviews. Themes where identified through inductive and deductive coding. A total of 13 SMME owners participated in the study.

Main findings: The main findings identified five categories of influencing factors, namely Risk, SMEracter, Operations, Limitations and/or Opportunities and/or Rewards. The sub-themes highlighted unique influencing factors such as ‘fuzzy feel good’, financial potential, time, capacity, core of the entity and ‘engine’. The findings also highlight how the five categories of influencing factors relate to each other in the SDM context.

Practical/managerial implications: The findings provide SMME managers and/or owners with insight into that which influences their SDM, and how these factors relate to each other. Such knowledge improves SDM, environmental scanning, and assists in identifying how to mitigate influencing factors during SDM.

Contribution/value-add: This article makes a theoretical contribution by providing additional insights pertaining to the influencing factors of SDM in SMME, and how they relate to each other, adding to the body of knowledge related to SDM in SMME.