Since March 2016, SEED has embarked on a consultative process with the objective of developing a Business Development Services (BDS) standard focusing on services for Small and Medium Enterprises (SMEs), in particular eco-inclusive enterprises, in South Africa.
SMEs are the backbone of the South African economy – they contribute about 50% to GDP, and more than 50% of the South African labour force. However, SMEs face significant challenges: management skills, financial literacy, building long-lasting partnerships and human resource management figure on the long list of skills enterprises need, but don’t necessarily combine in their teams. The BDS industry can and has been trying to assist enterprises in tackling those challenges, yet its successes fail to achieve the full potential. The industry is unregulated, it greatly lacks in quality, and real impacts are questioned. A standard scheme to ensure and differentiate high-quality BDS providers is long overdue.
Against this background, the Government of Flanders supports SEED through the project “Building an Ecosystem for Social and Environmental Entrepreneurship in South Africa, with a focus on Limpopo, KwaZulu Natal and Free State“. The mission of the project is that of promoting the formal introduction of national BDS standards, which assure professional conduct and minimum service levels in the industry. The objectives are not only to increase the quality of existing BDS, but further to assist enterprises, investors, private and government entrepreneurship programmes in their decision on the best-suited BDS providers, and to enable quality BDS providers to show the quality of their services and gain trust.
About a year ago, at the SEED South Africa Symposium in March 2016, BDS providers, incubators, accelerators and other important ecosystem actors joined the mission at the first BDS Practitioners Dialogue – the first peer-learning workshop with practitioners from the BDS industry of this kind. Among many others, representatives of Catalyst for Growth, the Inclusive Business Accelerator (IBA), the International Labour Organization (ILO), Innovation Hub and both the Department of Tourism and Environment were part of the consultation process. Together, a shared understanding on the challenges in the industry was created. Concrete entry-points for BDS provision in the South African landscape were identified, with the common goal of co-developing a roadmap for implementation of BDS standards.
The established partnership is crucial in order to mainstream a certification scheme into existing curricula for BDS training. The first Practitioners Dialogue successfully showed the way to what BDS standards could look like and what are important aspects to be included. Concrete and realistic ideas were brought on paper to start building the main blocks of a national standard system: standard content, the accreditation model, the governance structure & sustainability. The consultation process was continued at a second meeting in October 2016, and recently at the third Practitioners Dialogue in April 2017 at the 2017 SEED South Africa Symposium.
For the latest discussion, SEED partnered with The Institute of Business Advisors Southern Africa (IBASA) and The Services Sector Education and Training Authority (Services SETA) to jointly with other key actors, such as the Department of Small Business Development (DSBD), the Small Enterprise Development Agency (SEDA), and the South African Bureau of Standards (SABS), take the successfully established partnership to the next level. The Practitioners agreed that formality is an important aspect for the BDS standard, a standard that should be voluntary and non-exclusive. SABS as a technical support partner provided solid guidelines on the process to be followed in the formalisation of a BDS standard. Taking the process forward, SABS has agreed to provide technical support and training to SEED and its partners in the development of the standard.
To fully harness the potential of SMEs for sustainable development and the Sustainable Development Goals (SDGs) all stakeholders jointly expressed the importance of developing a robust, generic set of standards that includes eco-inclusive standards. In order to achieve this, the triple bottom line (TBL) must be taken into account when formulating standards. The informal sector and the Base of the Pyramid (BoP) in rural and urban areas shall be considered to assure a truly inclusive BDS landscape. Here, the process will benefit from SEED’s expertise on eco-inclusive entrepreneurship.
We are now excited to build on the momentum and move to the next phase: to turn the stakeholder discussions into a concrete roadmap and detailed work on the content. The remaining actors missing in the partnership have been identified and will be brought on board by SEED. The partnership will then proceed to develop a comprehensive roadmap that will be built within the formal systems of the SABS Standard Development Processes.
This blog is a part of the June 2017 series on advisory support for inclusive businesses in partnership with USAID and the African Agricultural Fund’s Technical Assistance Facility, both of which deliver advisory support and have new analysis of it just launched (AAF’s TAF) and forthcoming (USAID).
Read the full series for more lessons from seven different providers of advisory support and stories of success from entrepreneurs.
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