A Framework of Key Growth Factors for Small Enterprises Operating at the Base of the Pyramid

Abstract

Enterprises operating at the Base of the Pyramid (BoP) find it difficult to simultaneously achieve economic (profitable growth) and social (poverty alleviation) outcomes. This study builds on a previously published systematic literature review that identified the key growth-promoting factors of the Small, Medium, and Micro Enterprises (SMMEs) operating in this space. A Grounded Theory Approach was followed to identify six core focus areas, which form the basis of a practical framework to evaluate SMMEs at the BoP, namely: Business modelling; business strategy; innovation; marketing; strategic alliances; and sustainable development. Expert screening interviews were conducted to evaluate the framework for credibility and confirmability. Thereafter, 57 for-profit South African enterprises were surveyed to empirically explore how SMMEs view and implement these framework components. The outcome of the study is a validated high growth-promoting BoP portfolio framework against which SMME owners can evaluate their enterprises to identify areas of growth and development.

Exploring BoP Generations through Business Model Innovation Lens: A Review and Framing

“…Affordability-Price VO_APR [151] Shared use [151] Tiered pricing [68,137,152,157,158] Scale down or adapt a technology imported from developed markets Availability/Accessibility VO_AA [130] [145] Make the 'shopping together' model available to customers Inclusivity VO_IN [138] Network with important partners/Relationships VO_NET [29,40,109,145] The value proposition component (VP) is fundamentally the firm's central delivery and its fundamental approach to gaining a competitive advantage [36]. Although traditional approaches often focus on the value proposition tailored to customers, within the context of BoP 3.0, this code is centered on the values created for the BoP community, as well as for broader society and the environment.…”

“…Cross sector [11,164] PT_CS [12,32,90,111,135,151,158,169] With NGOs [111] With civil society/social organizations [11,35,38,69,82,111,123,151,170] With the government (public-private partnership-PPP)…”

Demonstrating How a High- Growth Framework Could Be Used to Assist a Social Enterprise to Identify Growth Factors and Improve Sustainability

“…Second, this study re-analysed and re-used a comprehensive survey gathered from Van der Merwe's [7]- [9] data collection through data-mining techniques. The data was collected across 57 SMMEs that conduct business with the BOP market.…”

“…This study builds on work done by one of the authors to develop the high-growth framework (HGF), which was formulated by Michael van der Merwe during his doctoral studies to look at the BOP market [7]- [9]. This comprehensive framework was created with the aim of guiding SMMEs that operate in the BOP towards sustainable high growth.…”

“…A grounded theory approach, coupled with interviews and survey validation, was followed to identify six core focus areas (categories) that formed the basis of a practical framework to evaluate SMMEs at the BOP and to assist with the areas that needed improvement [7]- [9]. This of course draws on significant areas in the academic literature, and is discussed in more detail in the sections that follow.…”