How do we develop a stronger M&E culture in the new environment?
Governments and societies expect SMMEs to create jobs in their communities and often ignore the well-being of these enterprises. Even though the South African government has institutions in place to support SMMEs, there are still emerging barriers affecting the business of SMMEs and these challenges are limiting them from developing a climate that can induce local economies to address the unemployment and poverty affecting most, especially black African families, mostly youth and women.
Entrepreneurs are innovators, economic agents that are driving their businesses by assembling the resources, that includes their personal skills, and seek market opportunities and resources to exploit them. Small businesses’ struggles to survive in the Covid 19 era has been widely acknowledged, hence government and private sector aid SMMEs through financial support programmes to help them steady through the Covid 19 period.
Covid 19 arrived on our shores and found stagnant economic growth, and it can be argued, a mortally wounded and weak small business population. We wait to see the results of the combined effects of these factors on our small businesses and on community livelihoods.
One of the key factors why the our small business population has been weak and needing real care long before Covid 19, has been the lack of a well-co-ordinated structured ecosystem-wide monitoring and evaluation system to drive programme design, decisions and policy making.
Monitoring and evaluation is needed to assess the economic efficiency of SME and entrepreneurship policy actions and programme interventions. They should also inform the design and mix of SME and entrepreneurship policies (and programmes) by identifying those features which lead to desirable outcomes. Evaluation is fundamental to public accountability.
Public accountability through effective and transparent monitoring and evaluation is sorely lacking in the small business landscape. It is estimated that over R20b is spend in corporate ESD programmes alone in South Africa.
Add to this the spend by government departments and agencies at national, provincial and local level, then you will understand why the South African SMME ecosystem is regarded as having a bounty of financial resources which has led to the rapid development of body of the Small Business support sector, often referred to as the Business Development Support (BDS) Providers. It is estimated that we have about 500 such formal entities all developing, capacitating, advising, coaching, supporting South African small businesses. Add to this number, the thousands of independent professionals who also pay in the space of providing nonfinancial support to small businesses. Then we should have a very robust ecosystem with great results to show for it.
Over 20 years later since the dawn of democracy, after a plethora of legislation and policies and billions of Rands later, what have we got to show for it?
Is there lack of will within the policy environment and the within ecosystem in general, with an over preoccupation on self-interests?
Reliable methods for the evaluation of SME and entrepreneurship policies and programmes using appropriate tools and techniques have been established and demonstrated. However, such methods, which can address the heterogeneous impacts of policies and programmes on different types of SMEs, are not widely used.
Key challenges include increasing the application of rigorous evaluation techniques; better specifying policy and programme objectives, targets and indicators; making better use of data, including existing national administrative data sets for purposes such as tax and social security; and seizing the potential of Big Data.
It is important to make better use of evaluation in the policy cycle; evaluate systematically across the portfolio of SME and entrepreneurship interventions; and assess the impacts on SMEs and entrepreneurship of policies and programmes. in areas where business development support is not the primary objective.
How can a stronger culture of monitoring and evaluation be established for SMME and entrepreneurship policies and programmes?