Abstract:
Small and medium-sized enterprises (SMEs) have a significant role to play in job creation and bridging the widening gap between the rich and the poor in South Africa. Several factors determine the success of SMEs. One factor that has been largely overlooked in South Africa by researchers is innovation capacity - made up of different capabilities. As a result, there exists a gap in the literature that this study aims to fill. The purpose of this study is to compare the innovation capacity of South African consulting engineering firms and to identify the differences in innovation capabilities across small, medium and large firms, with a focus on SMEs. The innovation capacity survey was distributed using an email invitation to participate in the study, that contained a link to access the survey questionnaire online. The results of the study show that overall, South African engineering consulting firms reported an “average” to “high” innovation capacity; medium and large sized firms performed similarly, and small firms lagged. The study found that there exists a significant hierarchy in performance for entrepreneurial capabilities, risk management capabilities and capabilities for market and customer knowledge, where larger firms reported a higher scoring than smaller firms. More particularly, the study found that small firms lagged medium and large-sized firms strongly on risk management capabilities and capabilities for market and customer knowledge. These results hope to assist policy makers in prioritising lagging capabilities as the point of departure for capability building efforts. In addition, the results should assist entrepreneurs to be mindful of potential blind spots that could be hindering growth. The findings should ideally encourage both practitioners and policy makers to engage in efforts to stimulate the innovation capacity of South African consulting engineering firms either through internal or external interventions. SMEs that are enabled and empowered to be innovative will stand a better chance of fulfilling their developmental role within South Africa’s economy.
