Critical competencies of successful business rescue practitioners in South Africa

Abstract

The success rate of business rescue in South Africa remains low and the intention of the Department of Trade and Industry to save jobs is not being achieved. Business rescue is a growing area of business focus in South Africa due to an increase in the number of companies filing for business rescue. There is a need for empirical research on factors that influence the success of business rescue. This study explores the foundational competencies of successful business rescue practitioners in South Africa and the required domain knowledge to supports these competencies. The study was a qualitative, exploratory study that gathered data through 15 detailed, semi-structured interviews with business rescue practitioners, academics, legal experts, banking professionals and turnaround experts. Literature revealed four higher-order competencies for business rescue practitioners, namely sense making, decision making, integration and collaboration. The study confirmed these higher-order competencies and expanded to the foundational competencies that are crucial for these higher-order competencies. The research also confirmed that business management, legal knowledge and finance domain knowledge are the required domain knowledge areas that support business rescue competencies. A key finding that further emanated from this study is the need for a turnaround mindset and upholding high ethical standards amongst business rescue practitioners in South Africa. The findings of this study were integrated into a Business Rescue Practitioner Competencies Model that may aid managers in selecting and evaluating business rescue practitioners, it may guide accreditation bodies and learning institutions in developing training material for business rescue practitioners and assist business rescue practitioners to enhance their competencies.