understanding of entrepreneurial capacity …
TRANSCRIPT
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UNDERSTANDING OF ENTREPRENEURIAL CAPACITY DEVELOPMENT
FOR SMEs IN TANZANIA:
A SURVEY OF STATIONERY SERVICES IN ILALA MUNICIPALITY
By;
Swaumu Athuman Mtaullah
A Dissertation Submitted in a Partial Fulfillment of the Requirements for Award
of Master of Business Administration in Corporate Management of
Mzumbe University.
2019
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CERTIFICATION
We, the undersigned, certify that we have read and hereby recommend for acceptance by
the Mzumbe University Dar es Salaam Campus College, a dissertation/thesis entitled
Understanding of Entrepreneurial Capacity Development for SMEs in Tanzania: A
Survey of Stationery Services in Ilala Municipality, in partial/fulfillment of the
requirements for award of the degree of Master of Business Administration of Mzumbe
University.
_______________
Major Supervisor
_______________
Internal Examiner
_______________
External Examiner
Accepted for the Board of MUDCC
______________________________________________________
PRINCIPAL, DAR ES SALAAM CAMPUS COLLEGE BOARD
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DECLARATION
AND
COPYRIGHT
I, Swaumu Athuman Mtaullah, declare that this thesis is my own original work and
that it has not been presented and will not be presented to any other university for a similar
or any other degree award.
.
Signature:
Date:
©
This dissertation is a copyright material protected under the Berne Convention, the
Copyright Act 1999 and other international and national enactments, in that behalf, on
intellectual property. It may not be reproduced by any means in full or in part, except for
short extracts in fair dealings, for research or private study, critical scholarly review or
discourse with an acknowledgement, without the written permission of Mzumbe
University, on behalf of the author.
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ACKNOWLEDGEMENT
First I would like to grant my grateful to almighty Allah for His blessings, love and
providing me with good health throughout my research work. From Him I believe that
good health and protection will ever be mine to the graduation with a Master degree from
the Mzumbe University.
Also, my sincere gratitude should go to my family for their financial, morally and spiritual
support during my studies. I am indebted to air out my gratitude to my friends and all
individuals, groups and authorities which supported accomplishment of this research
work.
Finally, I would be unfair if I forget to acknowledge my research supervisor, for her
untiring support through counselling and guidance, and he valuable academic instructions
which have contributed towards realization of this work.
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DEDICATION
This dissertation is dedicated to my dearest mother Salma J. Mtaullah, my beloved father
Athuman A. Mtaullah, my siblings Maisarah, Abbas and Twahir and all classmates
particularly the group members and fellows.
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LIST OF ABBREVIATIONS
GDP Gross Domestic Product
HLIs Higher Learning Institutions
NVQ National Vocational Qualifications
OECD Organization for Economic Co-operation and Development
SMEs Small and Medium Enterprises
TAPBDS Tanzania Association of Professional Business Development Services
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ABSTRACT
This study wanted to understand the entrepreneurial capacity development for SMEs in
Tanzania. To achieve this rationale, a total of 100 stationery entrepreneurs comprising
35% males and 65% females in Ilala Municipality were surveyed. The study was guided
to achieve three objectives namely; to describe entrepreneurial competencies needed by
SMEs entrepreneur, to describe how entrepreneurial capacity development contributes
towards acquisition of competencies needed by SMEs entrepreneurs and to find out how
entrepreneurial competencies are utilized for development of SMEs among
entrepreneurs. The required data were gathered using closed ended questionnaires as well
as by reviewing relevant documents. From the survey data, it was understood that survival
of the stationery services depended on the level and background education and experience
of entrepreneurs of stationery services. Also, it was understood that while profit and loss
records of the stationery was explained by ones years in the stationery services, the same
was not clear with the level and background education of the stationery entrepreneurs.
Hence, related experience in entrepreneurship would account high rate of failure of the
newly established business ventures in Tanzania. In order to develop stationery services,
it was understood that the stationery entrepreneurs needed combination of three
categories of competencies namely; the behavioral, managerial and technical
competencies. These competencies were acquired through different means such as short
courses, consultancies and community outreach services. Also, the study found that
utilization of entrepreneurial competencies such as related education and knowledge did
not guarantee entrepreneurs to establish profitable stationeries which is contrary with
Sen’s Capability Theory arguing that individual possessing entrepreneurial education and
knowledge is likely to be more successful than one who is not. The researcher
recommends among other things that in order to develop SMEs entrepreneurs, capacity
development should identify specific entrepreneurial competencies specifically
entrepreneurship and business experience and ensuring enabling them to acquire them
through short courses, consultancies or community outreach services.
TABLE OF CONTENTS
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CERTIFICATION......................................................................................................... i
DECLARATION AND COPYRIGHT ......................................................................... ii
ACKNOWLEDGEMENT ............................................................................................ ii
DEDICATION ............................................................................................................ iv
LIST OF ABBREVIATIONS ........................................................................................v
ABSTRACT................................................................................................................ vi
LIST OF TABLES ...................................................................................................... xi
LIST OF FIGURES .................................................................................................... xii
CHAPTER ONE..........................................................................................................1
PROBLEM SETTING ................................................................................................1
1.1. Introduction ............................................................................................................1
1.2. Background to the problem .....................................................................................1
1.3. Statement of the problem ........................................................................................4
1.4. Research objectives ................................................................................................6
1.4.1. General objective .................................................................................................6
1.4.2. Specific objectives ...............................................................................................6
1.5. Research questions .................................................................................................6
1.5.1. General question ..................................................................................................6
1.5. Research questions .................................................................................................6
1.6. Significance of the study.........................................................................................7
1.7. Limitations of the study ..........................................................................................7
1.8. Delimitation of the study ........................................................................................8
1.9. Organization of this dissertation .............................................................................8
CHAPTER TWO ...................................................................................................... 10
LITERATURE REVIEW ......................................................................................... 10
2.1. Introduction .......................................................................................................... 10
2.2. Theoretical literature............................................................................................. 10
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2.2.1. Entrepreneurial capacity development ............................................................... 10
2.2.2. SMEs ................................................................................................................. 11
2.2.3. Theory relevant to the study ............................................................................... 12
2.2.3.1. Relevance of the study .................................................................................... 13
2.2.3. Entrepreneurial competencies needed by SMEs entrepreneurs ........................... 15
2.2.4. Contributions of entrepreneurial capacity development towards acquisition of
competencies needed by SMEs entreprenerus ............................................................ 18
2.2.5. The link between entrepreneurial competencies and development of SMEs ....... 20
2.3. Empirical literature ............................................................................................... 21
2.3.1. Studies in Tanzania ............................................................................................ 21
2.3.2. Studies outside Tanzania.................................................................................... 23
2.4. Research gap ........................................................................................................ 26
2.5. Conceptual framework for understanding entrepreneurial capacity development .. 26
2.5.1. Competency need .............................................................................................. 27
2.5.2. Competency acquisition ..................................................................................... 27
2.5.3. Competency utilization ...................................................................................... 28
2.5.4. Development of SMEs ....................................................................................... 28
CHAPTER THREE .................................................................................................. 28
METHODOLOGY .................................................................................................... 28
3.1. Introduction .......................................................................................................... 28
3.2. Research design .................................................................................................... 29
3.3. Area of the study .................................................................................................. 29
3.4. Population ............................................................................................................ 30
3.5. Sampling design ................................................................................................... 30
3.5.1. Sampling techniques .......................................................................................... 30
3.5.2. Sample size........................................................................................................ 31
3.6. Data collection approaches ................................................................................... 32
3.6.1. Questionnaires ................................................................................................... 32
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3.6.2. Documentary review .......................................................................................... 32
3.7. Operationalization of research questions ............................................................... 32
3.8. Data analysis and procedure ................................................................................. 33
3.9. Validity and reliability .......................................................................................... 33
3.10. Research ethical issues........................................................................................ 34
CHAPTER FOUR ..................................................................................................... 37
PRESENTATION AND DISCUSSION OF FINDINGS ......................................... 37
4.1. Introduction .......................................................................................................... 37
4.2. Basic information of the surveyed respondents and stationery services ................. 37
4.2.1. Basic information of the surveyed respondents .................................................. 37
4.2.1.1. Association between the survival of the stationeries in the coming five years .. 42
4.2.1.2. Association between survival of the stationeries in the coming five years ...... 42
4.2.1.3. Association between survival of the stationeries in the coming five years ...... 43
4.2.2. Basic information of the surveyed stationery services in Ilala Municipality ........ 44
4.2.2.1. Association between earning profit by the stationery in the past five ............... 47
4.2.2.2. Association between earning profit by the stationery in the past five ............... 48
4.4. Ways which entrepreneurial capacity development contributed towards acqusition
of competencies needed by SMEs entrepreneurs .......................................................... 50
4.5. Utilization of entrepreneurial competencies for development of SMEs ................ 52
CHAPTER FIVE ....................................................................................................... 55
SUMMARY, CONCLUSION AND RECOMMENDATIONS ................................ 55
5.1. Summary .............................................................................................................. 55
5.2. Conclusion ........................................................................................................... 58
5.3. Recommendations ................................................................................................ 59
5.4. Implications of the study....................................................................................... 60
5.5. Recommendation for coming researches ............................................................... 60
REFERENCES .......................................................................................................... 63
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APPENDIXES ........................................................................................................... 67
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LIST OF TABLES
Table 3. 1: Classification of SMEs in Tanzania ........................................................... 30
Table 3. 2: Operationalization of research questions and variables ............................... 32
Table 4.1(a). : Basic information of the respondents .................................................... 38
Table 4. 2(b). : Basic information of the respondents ................................................... 40
Table 4. 3: Basic information of the surveyed stationeries ........................................... 44
Table 4. 4: Description of the entrepreneurship competencies required by SMEs ......... 49
Table 4. 5: Ways which entrepreneurship capacity development contributed towards
acqusition of competencies needed by SMEs entrepreneurs ......................................... 50
Table 4. 6: Utilization of entrepreneurial competencies for the development of SMEs
entrepreneurs ............................................................................................................... 52
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LIST OF FIGURES
Figure 2. 1: Conceptual framework for understanding entrepreneurial capacity for the
develolment of SMEs .................................................................................................. 27
Figure 4. 1: Survey on the survival of the stationery services in the coming five years . 41
Figure 4. 2: Surveyed stationeries in terms of profit making in the past five years ....... 46
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CHAPTER ONE
PROBLEM SETTING
1.1. Introduction
This chapter elaborates the background to the problem, statement of the problem, research
objectives and research questions, the significance of the study, limitations of the study,
delimitation of the study, definitions of operational terms and finally it provides the
organization of this dissertation.
1.2. Background to the problem
Small and Medium Enterprises (SMEs) occupy the largest part and the very important
role in the World economy. In some literatures SEMs are perceived to be the drivers of
economic growths in any nation (Ayyagari, 2012). The SMEs are perceived as the engine
of economic development (Isaga, Masurel, and Monfort, 2015) and also the driving forces
of economic development and employment creation (Kazimoto, 2004; Mori, 2017). The
SMEs occupy a lead role in the provision of reasonably priced goods and services and
generation of income to a large number of people (Muthoni, 2013). The SMEs occupy
about 95% of all enterprises in the world thereby contributing about 60 to 70 per cent of
total global employment (Mori, 2017; Salim, 2012; Mzomwe, 2015).
In Africa, more than half of country’s employment and GDP is contributed by SMEs;
hence they have remained the pivot and eyes of Africa economy (Isaga et al., 2015).
Muthoni (2013) reported that SMEs contributed more than 50 percent of new jobs created
in Kenya in 2005. The same to Tanzania, about 35 per cent of the GDP comes from SMEs
(Mwasalwiba, 2017). Despite the crucial role of SMEs in Tanzanian economy, they have
continued to face a number of constraints which limit their growth, success and survival
(Isaga et al., 2015).
The problems such as low level of education among SMEs entrepreneurs, lack of
experience in running businesses, lack of financial management and control system, poor
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practices in keeping business records, poor control of stock of materials and goods, lack
of related experience in entrepreneurship and businesses, poor planning and pricing and
lack of skilled personnel are commonly facing Tanzanian SMEs (Kazimoto, 2004).
A number of strategies have been undertaken by the Government, business people and
development partners to enhance the success of SMEs and the entrepreneurial capacity
development is one of these (Lopez and Pastor, 2015; Bayrón 2013; Organization for
Economic Co-operation and Development [OECD], 2004; Potapchuk and Bureau, 2015;
Mori; 2017; Pansiri and Temtime, 2014; Muthoni, 2013; Mwasalwiba, 2017).
The entrepreneurial capacity development entails entrepreneurial orientation and
methods, practices and decision-making processes which encourages success of SMEs
(Jitnom and Ussahawanitchakit, 2009). Also, it is the planned process of enhancing
capacity and capabilities to design and manage the SMEs effectively (Morgan and Saxby,
2007). Entrepreneurial capacity development aims to increase competencies of
entrepreneurs to perform core functions, solve problems, define and achieve objectives
as well understand and deal with SMEs management and operational functions in a broad
context and in a sustainable manner (Vallejo and When (2016).
The entrepreneurial capacity development is considered as the means to bridge the ‘gap’
of entrepreneurship and business related competencies among entrepreneurs, thus
improving SMEs (Pansiri and Temtime, 2014; OECD, 2004; Mwasalwiba, 2017). The
term competency is describing the characteristic of a person which results into effective
and superior performance (Boyatziz 2009). Ozçelik and Ferman (2006) defined
competencies as the clusters of related knowledge, skills, and attitudes that affects a major
part of one’s job, that correlates with job performance, that can be measured against well-
accepted standards and that can be improved through training and development. Thus,
one of the major concerns of entrepreneurial capacity development is to improve those
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knowledge, skills and attitudes which entrepreneurs needs for development of their
SMEs.
As the solution concern, capacity development in Tanzania it is becoming a part of
national development agenda implemented in different forms (Mwasalwiba, 2017).
Lopez and Pastor (2015) found that capacity development was implemented through
planned meetings between entrepreneurs and mentors. This process enabled mentors to
identify the weaknesses, strengths and capacities needed by entrepreneurs. The meetings
enabled mentors to identify the most capacity need areas for effectiveness of SMEs
entrepreneurs. The areas where competencies were needed were mainly the technical
competencies, behavioral competencies and contextual competence. (Lopez and Pastor,
2015).
The other forms of capacity development is by involving Higher Learning Institutions
(HLIs) in the provision of entrepreneurial and business education through short courses
and planned learning programmes to the prospective and existing entrepreneurs. Bayrón
(2013) quoted Articles 7 of the World Declaration on Higher Education for the 21st
Century of 1998 which directs that “…developing entrepreneurial skills and initiatives
should become a major concern of the Higher Education…” As a part of implementation
of this directive, there has been substantial increase in numbers of entrepreneurship
courses among HLIs across the globe. For instance, in the United Kingdom the
entrepreneurship courses in the HLIs quadrupled from 104 in 1975 to more than 500 in
2006 (Bayron, 2013). In Tanzania, since 2003 there has been an increasing of
entrepreneurship training courses among HLIs (Mwasalwiba, 2017).
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Despite that entrepreneurial capacity development is becoming popular, there has been a
number of issue need to be resolved. One of them is lack of agreement on what
entrepreneurial capacity development actually is and how to evaluate its results on the
development of SMEs (Potapchuk and Bureau, 2015). The other it was reported by
Whitlock & Master (2006) in the United Kingdom that after four years having taken
entrepreneurship courses, interest in creating new business ventures among students
tended to dissolve. Luthje and Franke (2013) went further by claiming that no clear
relationship has been demonstrated between entrepreneurial capacity development and
students becoming effective SMEs manager.
Other scholars like Morgan and Saxby (2007) questioned how the Government and
business people should collaborate to fill capacity gaps preventing effectiveness of SMEs.
These foundation issues indicate that increasing entrepreneurial capacity development
needs further investigations to unveil realities of entrepreneurial capacity development in
the context of the development of SMEs particularly in Tanzania. This context motivated
the researcher to seek an understanding of the entrepreneurial capacity development for
SMEs in Tanzania specifically among stationery services providers in Ilala municipality.
1.3. Statement of the problem
Entrepreneurial capacity development is a rapid growing strategy of addressing
constraints facing SMEs aiming to enhance their survival and success among others.
Through entrepreneurial capacity development, SMEs entrepreneurs are expected to
acquire competencies needed for development of their SMEs (Morgan and Saxby,
2007;Vallejo and Wehn, 2016). A number of HILs students, entrepreneurs and
unemployed have reported to attend entrepreneurial capacity development programs. The
study by Mwasalwiba (2017) among four HLIs in Tanzania namely; Sokoine University
of Agriculture, Mzumbe University, College of Business Education and Institute of
Finance Management, found that entrepreneurship courses were taught in different levels
(undergraduate, master and PhD levels) and in different modes (as a single subject,
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elective, compulsory, or specialized bachelor/master degree). He further found that most
segments in the society had access to entrepreneurial education. The business students
were the most recipients of entrepreneurship education rated 30% followed by
entrepreneurs rated at 23%, minority groups rated at 19%, non-business students rated at
17% and the last group were policy makers and unemployed rated at 5% each
(Mwasalwiba, 2017. The studies HLIs were providing entrepreneurial courses to their
students and to local communities through organized consultancies and outreach services;
that is, services offered by HLIs to assist indigenous enterprises to form and grow
(Mwasalwiba, 2017). Some results expected from increasing entrepreneurial capacity
development courses is enhancing development of SMEs in the society.
Unfortunately, existing literatures do not offer detailed understanding how
entrepreneurial capacity development is developing the SMEs. For instance, Kauffman
Foundation (2010) in Bayrón (2013) reported that in the United Kingdom where
entrepreneurial capacity development programs among HLIs quadrupled from 104 in
1975 to more than 500 in 2006, after four years of attending and completing the courses,
the interests in creating business ventures tended to dissipate (Whitlok and Master, 2006).
Luthje and Franke (2013) arrived to the conclusion that no clear relationship may be
demonstrated between entrepreneurial capacity developments and becoming successful
SMEs entrepreneurs.
The report by Tanzania Association of Professional Business Development
Services [TAPBDS] (2015) highlighted that among 100 new established SMEs; only 5
survive to five years, the rest die within the first six month, others within two years and
the remaining within three years. A fundamental question confronted the researcher was
why there has been high rate of failure of newly established SMEs enterprises despite the
increasing entrepreneurial capacity development programs to different segments of
Tanzania community. In order to answer the question, this study was conducted so as to
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understand the entrepreneurial capacity development for SMEs entrepreneurs in Tanzania
particularly among stationery services providers in Ilala Municipality.
1.4. Research objectives
1.4.1. General objective
To enhance understanding of the entrepreneurial capacity development for the SMEs
entrepreneurs in Tanzania.
1.4.2. Specific objectives
i. To describe entrepreneurial competencies needed by SMEs entrepreneurs in stationery
services in Ilala Municipality.
ii. To describe how entrepreneurial capacity development facilitates acquisition of
competencies needed by SMEs entrepreneurs in stationery services in Ilala
Municipality.
iii. To find out how entrepreneurial competencies are utilized for development of SMEs
in stationery services in Ilala Municipality.
1.5. Research questions
1.5.1. General question
What should be understood about entrepreneurial capacity development for SMEs
entrepreneurs in Tanzania?
1.5. Research questions
i. What are the entrepreneurial competencies needed by SMEs entrepreneurs in
stationery services in Ilala Municipality?
ii. How entrepreneurial capacity development facilitates acquisition of competencies
needed by SMEs entrepreneurs in stationery services in Ilala Municipality?
iii. How entrepreneurial competencies are utilized for development of SMEs in stationery
services in Ilala Municipality?
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1.6. Significance of the study
The study holds significance to individuals, groups, and the general community by
clarifying capacity development needed by SMEs entrepreneurs in stationery services in
Ilala Municipality.
Next, the study provides framework to evaluate how increasing capacity development
programme has enabled SMEs entrepreneurs to acquire competencies needed for
development and success of SMEs.
Again, the study enhances understanding of the link between capacity development and
development of SMEs in the context of observations among earlier scholars such as
Luthje and Franke (2013) who claimed that no clear relationship demonstrated between
entrepreneurial capacity developments and becoming successful SMEs manager.
Finally, the study enabled own researcher to fulfill the requirement for the award of
Master degree in Business Administration of Mzumbe University.
1.7. Limitations of the study
In order to understand entrepreneurial capacity development for SMEs in Tanzania, 100
SMEs specializing in stationery services in Ilala Municipality were surveyed to solicit
information needed to answer research questions. This approach is recommended by
different authors such as Cooper and Schindler (2011) as very useful to enhance in-depth
understanding of the problem in a detailed multiple perspectives. However, one limitation
which the approach posed was that finding results were confined among the surveyed
SMEs and not capable for generalization to all SMEs in Tanzania.
Also, the study used purposeful and convenient sampling techniques whereas SMEs
surveyed basing on information in mind that the owners and/or managers possessed
information required. However, using this technique posed another limitation of failure
to generalize information obtained from the field to all individuals among the surveyed
100 SMEs in Ilala Municipality.
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1.8. Delimitations of the study
This study was concentrated with the understanding of the entrepreneurial capacity
development for SMEs in Tanzania. Geographically, the scope of the study was in Ilala
Municipality in which a total of 100 SMEs venturing in stationery services were
surveyed.
The scope in terms of the results is explained by the answers on three research questions
namely: what are the entrepreneurial competencies needed by SMEs entrepreneurs in
stationery services in Ilala Municipality? How entrepreneurial capacity development
facilitates acquisition of competencies needed by SMEs entrepreneurs in stationery
services in Ilala Municipality? How entrepreneurial competencies are utilized for
development of SMEs in stationery services in Ilala Municipality?
Again, on the studied variables, only three independent variables against one dependent
variable were studied. The independent variables were: the competency needs among
SMEs entrepreneurs, competency acquisition among SMEs entrepreneurs and
competency utilization among SMEs entrepreneurs. The dependent variable was the
development of SMEs which was measured by profit, loss and survival potential.
1.9. Organization of this dissertation
This dissertation is organized into five chapters. The first chapter covers the background
of the problem, statement of the problem, research questions, research objectives,
significance of the study, limitations of the study, scope of the study and the organization
of the dissertation.
The second chapter is about literature review. It is written by presenting the key concepts,
variables and principles learned into three major headings namely; theoretical literature,
relevant theory and empirical literatures. This chapter ends by identifying knowledge gap
which was given attentions by the researchers and the conceptual framework within
which the study was carried out.
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The third chapter is about the research methodologies adopted by the researcher. This
chapter elaborates the research design, area of the study, target population, sampling
techniques and sample size, data collection methods, data analysis, operationalization of
research questions, validity and reliability issues and ethical consideration.
The forth chapter is about presentations, interpretations and discussions of the finding
results. This chapter is organized into three major subsections in accordance with
objectives of the study, that is; entrepreneurial competencies needed by SMEs
entrepreneurs, ways which entrepreneurial capacity development facilitates the
acquisition of competencies needed by SMEs entrepreneurs and the ways which
entrepreneurial competencies are utilized for development of SMEs among stationery
services in Ilala Municipality.
The last chapter is chapter five which provides a summary of the study, conclusion and
recommendations. It further elaborates the implications of the study and the
recommendation for further researches.
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CHAPTER TWO
LITERATURE REVIEW
2.1. Introduction
This literature review involves extraction of relevant concepts from the books, research
journals and articles, academic reports and papers so as to be familiar with the problem
under the study. Through this literature review, the concepts and variables constituting
the study are understood and the relationships among them are explained. The concepts
extracted from literatures are organized into two major headings namely; theoretical and
empirical literature. The theoretical literature comprises the conceptual definitions,
theoretical framework, entrepreneurial competencies needed for effectiveness of SMEs
entrepreneurs, contributions of entrepreneurial capacity development on the acquisition
of entrepreneurial competencies, the link between entrepreneurial competencies and the
success and failure of SMEs. The empirical literature comprises review of similar
researches on the similar and related issue which were conducted within and outside
Tanzania. Finally this chapter concludes by identifying knowledge gap and by developing
the conceptual framework within which the study was carried out.
2.2. Conceptual definitions
2.2.1. Entrepreneurial capacity development
Entrepreneurial capacity development is defined as the planned, formal and informal
process of enhancing competencies of entrepreneurs to design and manage a job
effectively (Morgan and Saxby, 2007; Lopez and Pastor, 2015). The process may employ
the planned meeting between entrepreneurs and mentors (Lopez and Pastor, 2015) or
provision of entreperneruship and business education, short courses and consultanceis by
Higher Learning Institutions (HLIs) (Bayrón, 2013; Mwasalwiba, 2017). The
competencies which are the main construct of entrepreneurial capacity development
mean the characteristics underling a person which determines his superiority on the job
(Boyatziz, 2009).
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When applied to SMEs, the competencies of entrepreneurs should determine ones
effectiveness and superiority (Armstrong, 2010) in managing the SMEs and may be the
significant differentiator of the SMEs which succeed, fail or survive over years
(TAPBDS, 2015). In the study by Lopez and Pastor (2015), competencies needed by
SMEs entrepreneurs were identified as behavioral, technical and managerial
competencies. The behavioral competencies are the characteristics of SMEs
entrepreneurs such as setting challenging goals, creating own measures of excellence and
constantly seeking ways of improving SMEs performance, working anticipatively and
develop positive relationships with colleagues; the technical competencies include the
fundamental skills, personal attitudes, skills and related experience needed by SMEs
entrepreneurs. The managerial competencies describe characters of SMEs manager such
as managing relations with workers, customers and suppliers and all affairs of the SMEs
(Lopez and Pastor, 2015).
2.2.2. SMEs
SMEs is the acronym of the words ‘Small and Medium-sized Enterprises’ and it is widely
used to mean non-subsidiary, independent organizations employing less than a given
number of employees that varies across countries (Gonzalez, 2007). Also, the acronym
encompasses micro enterprises though non-farm economic activities mainly
manufacturing, mining, commerce and services (Khan, 2010). In defining SMEs,
different countries use various measures of size depending on their level of development
(Parker, 2006). The common measures used are: total number of employees, capital
investment, sales turnover or all. Classification of SMEs basing on financial assets, the
European Union utilizes the ceilings of employees and financial assets. According to this
system, the medium-sized enterprises (50-249 employees) is less than EUR 50 million;
small enterprises (10-49 employees) does not exceed EUR 10 million; and the micro firms
(<10 employees) is less than EUR 2 million (OECD, 2005).
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The United States and Canada considers SMEs to include firms with fewer than 500
employees while classifying firms with 500 or more employees as large businesses (Rae,
2012).
In Tanzania, micro enterprises are those engaging up to 4 people, in most cases family
members or employing capital up to Tshs.5.0 million of which the majorities are under
the informal sector (Mzomwe, 2015). Small enterprises are mostly formalized businesses
engaging between 5 and 49 employees, with Tshs.5 million to Tshs.200 million capital
investments. Medium size enterprises are those employing between 50 and 99 people
with capital investment between Tshs.200 million to Tshs.800 million (Olomi, 2009;
Mori, 2012). When a business shows two distinct characteristics, between number of
employees and capital investment or sales revenue, the capital invested becomes a
decisive factor (Mzomwe, 2015).
2.2.3. Theoretical review
The Amartya Sen’s Capability Theory was selected as the analytical tool in this study.
This Theory was developed by Senin 1980’s and publicized through a number of his
works including those published in 1988, 1992, 1993, 1999 and 2004. Sen argued that
people’s capability is the most relevant factor for understanding and evaluation of his/her
choices for life wellbeing. The key postulate of Sen’s Capability Theory is that “A
person’s capability to achieve functionings that he or she has reason to value provides a
general approach to the evaluation of social arrangements, and this yields a particular way
of viewing the assessment of equality and inequality” (Sen, 1992: 5). This assumption
has two major constructs: “capability” and “functionings”.
The term capability refers to specific abilities of person which must be brought together
to make up the overall capacity to manage the program effectively (Morgan & Saxby,
2007). Also it refers to all capabilities which individual possesses influencing
choices/freedom to achieve his/her well-being, that is; what can really do and want to be.
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(Sen, 1999). On the other hand, functionings refer to context in which a person is able to
operationalize his or her capabilities (Sen, 1999). Functionings of a person is useful to
evaluate whether he/she has some capability or not. In order to understand functionings
of individual, one needs to consider both external (with respect to the person) and internal
factors such as environmental context, personal skills, cognitive abilities, and even
personal beliefs (Potapchuk, 2015).
The Sen’s Theory informs and predicts the courses of actions for improving or increasing
choices of individuals to pursue specific life styles which they value most. According to
his Theory, choices increases with one’s freedom (e.g. possession of diverse capacities)
while well-being increases with individual’s freedom to pursue lifestyles which one value
most. In the same vein, Sen’s Theory informs that individual’s functionings
(opportunities to operationalize capabilities) is useful to evaluate the level of choices of
valuable life styles and achievement of desired well-being. This observation is well
commented by Potapchuk (2015: 5) that “…when we want to understand or increase
people’s wellbeing, we need to take into account value systems of each individual…”
2.2.3.1. Relevance of the theory to the current study
The theory was relevant because it is popularity among studies exploring entrepreneurial
capacities in the context of performance of SMEs. For instance, Potapchuk (2015) used
this theory to explore the link between entrepreneurial capabilities and human
development. Next, Madatta (2015) used this theory to assess the role of entrepreneurial
competencies on the success of the SMEs. Also, Mawere (2018) used the same theory to
examine the role of economic empowerment towards inclusive financial growth of youth
entrepreneurs.
Using Sen’s Capability framework, the current study was able to describe entrepreneurial
competencies needed by SMEs entrepreneurs, to describe how entrepreneurial capacity
development facilitated acquisition of entrepreneurial competencies needed by SMEs
14
entrepreneurs and finding out how entrepreneurial competencies are utilized for
development of SMEs.
According to Sen’s Theory, in order to develop SMEs (performance, success and
survivals) entrepreneurial capacity development to SMEs entrepreneurs is very
important. The capacity development increases ‘choices’ or ‘freedom’ such as kind of
entrepreneurial ventures to engage and the opportunities to manage and sustain such type
of venture.
The functionings refers to expected successfulness of operation of the particular SMEs.
This link is supported by a number of literatures such as OECD (2004) which contended
that without proper administrative capacities of SMEs it would be difficult to achieve the
results of SMEs. Also, Pansiri and Temtime (2014) commented that lack of managerial
competencies should not be allowed to continue if SMEs are to succeed. Similarly,
Potapchuk (2015) indorsed that if policy-makers are to create a policy helping
diversifying capabilities and interests of entrepreneurs; they must take different
entrepreneurial needs in account, that is; individual, inter-personal, societal and
institutional needs. He convinced that potential entrepreneur needs to overcome
individual (beliefs) and interpersonal (network) barriers; and to do this, he might have to
seek for some kind of external assistance (e.g. in dedicated institution) (Potapchuk, 2015).
Despite its usefulness to analyze capabilities in the context of SMEs performance, Sen’s
Capability Theory has been facing some limitations. One is the failure to build a list of
capabilities relevant to different contexts and to rank them (Saith and House, 2001). Sen
in his works intentionally does not specify such a list stressing that in every specific case,
relevance of different capabilities should be a subject of public discussions (Saith and
House, 2001). While recognizing the limitation posed by Saith and House (2001), the
current study focus on the assumption by Lopez and Pastor (2015) that entrepreneurial
capacity development provides the specific and measurable entrepreneurial competencies
15
to entrepreneurs which determine choices of kind of entrepreneurial ventures to engage
in and functionings of particular entrepreneurs in order to realize its objectives of
describing the kind capabilities which SMEs entrepreneurs really want, how
entrepreneurial capacity development programs enable entrepreneurs to acquire these
competencies and how these competencies are utilized for development of SMEs in
Tanzania.
Also, Sen (1999) demonstrated that education was the main factor enabled women in
India to obtain a better treatment and respect in society. Unfortunately, he did not tell
about the nature and scope of education in question. However, in Saito (2003) education
is regarded as a crucial element for capabilities expansion for two reasons: One is that
education allows people to discover existence of different possibilities and opportunities,
and this knowledge about (previously unknown) choices and freedoms is the first step to
achieving them. The second is that through education people acquire valuable
functionings that allow them, e.g., to obtain jobs that lead to more freedom.
The current study assumed that increasing entrepreneurship education either in long
courses, short courses, consultancies or community outreach services among HLIs in
Tanzania was crucial for entrepreneurial capacity development among prospective and
current entrepreneurs and would facilitate the development of SMEs.
2.2.3. Entrepreneurial competencies needed by SMEs entrepreneurs
Entrepreneurial competencies are key factors in any capacity development program
(Pansiri and Temtime, 2014; OECD, 2004; Mwasalwiba, 2017). As defined earlier,
entrepreneurial competencies refer to the abilities of entrepreneur to manage and improve
effectiveness of his/her SMEs. In reflection to Sen’s Capability Theory, increasing
entrepreneurial competencies through capacity development programs means increasing
choices of SMEs which particular entrepreneurs may create and improving effectiveness
to manage them effectively. In the management literatures, three categories of
competencies are known: behavioral competencies, technical competencies and NVQ
16
competencies (Armstrong, 2010). He defined behavioral competencies as behavioral
expectations or the type of behavior required to deliver results such as team working,
communication, leadership and decision making.
The technical competencies are defined as what people should know and be able to do
(knowledge and skills) for carrying out his/her job effectively. The NVQ competencies
are those specify minimum standards for the achievement of set tasks and activities
expressed in ways that can be observed and assessed with a view to certification.
The above competencies describe, inform and even predict whether or not a particular
person is able to perform work given in a specific area; hence information whether or not
one is competent or not yet competent on that work (Armstrong, 2010). While the first
two competencies are well understood in the entrepreneurship context, the last one, that
is ‘NVQ competencies’ seems not yet known since no agreement on what level of award
or certification a particular individual has to be competent entrepreneur as supported by
Mwasalwiba (2017) that no agreement about what entrepreneurship education is, its goals
are and how we should evaluate the results and efficiency of this kind of education.
Hence, NVQ competencies are limited from the competencies assessment in this study.
In the entrepreneurship and SMEs literatures, competencies needed by SMEs
entrepreneurs are documented although the importance of each competency is not well
given. For instance, Mwasalwiba (2017) found that behavioral competencies and
entrepreneurial skills, knowledge and related experience (technical competencies) were
important for entrepreneurs. Also, Pansiri & Temtime (2014) found that managerial
competencies was a critical factor affected performance of SMEs entrepreneurs.
According to him, development of SMEs should among other things focus on developing
managerial competencies. To achieve this, Government policies and strategies were
suggested to consider access to and affordability of entrepreneurial courses aiming to
enhance managerial competencies to SMEs entrepreneurs.
17
Also, in the study by Mori, (2017) on women entrepreneurship development in Tanzania,
it reported that behavioral, technical and managerial competencies were very crucial for
success of Tanzanian women SMEs entrepreneur’s. Regarding behavioral competencies,
he argued that women entrepreneurs were unsuccessfully due to communication
difficulties in relation to product specification and poor understanding of English
language.
Regarding technical skills, Mori (2017) observed that poor understanding of import
regulations, poor trade negotiation skills including reading and understanding supply
contracts and inability to meet order while ensuring quality described technical
incompetency, hence; ineffectiveness of women entrepreneurs in Tanzania.
Regarding managerial competencies, Mori (2017) identified that lack of interpersonal
skills attributed unsuccessfulness of Tanzanian women entrepreneurs. Bayrón (2013)
supported the sorts of entrepreneurial competencies needed by SMEs entrepreneurs by
mentioning individual competency than classifying them. According to him, areas which
entrepreneurs need to acquire greater competencies are: communication, effective time
management, human resource management, business ethics, social responsibility,
developing effective leadership qualities, decision making, marketing and financial
management.
Additionally, Lopez and Pastor (2015) study on developing rural areas through capacity
building and education for businesses clearly found that some competencies were more
essential than others for effectiveness of SMEs. The competencies which were needed
most for development of SMEs were: management and administration, technical
competencies and behavioral competencies. The managerial competencies as defined in
this study include managing relations with workers, customers and suppliers and all
affairs of the SMEs. The technical competency includes abilities to interpret and use
18
business policies and regulations, personal attitudes, skills and related experience needed
by SMEs entrepreneurs. Finally, behavioral competencies encompasses behavioral
attributed of entrepreneurs such as setting challenging goals, creating own measures of
excellence and constantly seeking ways of improving SMEs performance, working
anticipatively and develop positive relationships with colleagues.
Equally, as TAPBDS (2015) reported that among 100 new established SMEs; only 5
survive to five years, the rest die within the first six month, others within two years and
the remaining within three years in Tanzania, inadequacies of managerial, technical and
behavioral competencies were reported to account the phenomenon. The technical
competencies which were responsible include wrong business ideas, lack of business
plan, under estimating the competitors and poor choice of location. The management
competencies which were responsible included poor execution of responsibilities to staff,
ineffective marketing, and poor management of time. The behavioral competencies which
were responsible included failure to separate family issues and business issues (TAPBDS,
2015).
2.2.4. Contributions of entrepreneurial capacity development towards acquisition of
entrepreneurial competencies needed by SMEs
The contribution of entrepreneurial capacity development in acquisition of
entrepreneurial competencies is a rapidly growing field of study, hence extensively
studied (Potapchuk, 2015). Entrepreneurial capacity development programs are
suggested by number of scholars to provide opportunities for acquisition of competencies
required by entrepreneurs (Lopez and Pastor, 2015; OECD, 2004; Potapchuk, 2015;
Mori, 2017; Pansiri and Temtime, 2014). Also, areas where any entrepreneurial capacity
development should focus for enhancing those who are concern to acquire entrepreneurial
competencies are also suggested (Bayrón, 2013). However, none of the literatures
account contribution of entrepreneurial capacity development towards acquisition of
competencies needed by SMEs.
19
The presence of dedicated institutions (schools, colleges and university) (Potapchuk,
2015) and planned interactions between mentors (or role models) and prospective and
existing entrepreneurs (Lopez and Pastor, 2015) are reported to contribute largely in
providing competencies needed by entrepreneurs to overcome individual (beliefs) and
interpersonal (network) barriers (Potapchuk, 2015). The same is acknowledged under
Article 7 of the World Declaration of Higher Education for 21st Century directing that”…
developing entrepreneurial skills and initaitives that is, technical and behavioural
competenceis should become major concern of Higher Education …”. This Article
recognizes that having entreprenerual development prgoammes is the key to facilitate
production of graduates possessing competenceis needed for effectiveness of SMEs.
Bayrón (2013) in order capacity development programs to enahnce acqusition of
competenceis needed by entrepernerus, the common program contenxt among HLIs have
covering among others the following:
i. Lectures on business concepts;
ii. Business planning practices including competition and coaching;
iii. Intercation with practitioners and netwroking opportuniteis;
iv. Univeristy support such as market research resources, meeting spaces, seed funding,
panteting, advice, etc.
In the same vein, the current study recogniuzes that incresing entrepreneruship
development programs have opened opportunities for prospectrive and exixing
entrepreneurs to acquire competenceis needed by SMEs. Taking in account Mwalalwiba
(2017) report which shown that most of Tanzanian HLIs have adopted entreprenerurial
courses and education and training programs are currently given to most segments of the
Tanzanian communities such as business students, entrepreneurs, minority groups, non-
business students, policy makers and unemployed through long courses and short courses,
consultancies and community outreach services, the study will be able to assess how these
programs enable the targeted recipients to develop behavioral, technical and managerial
20
competencies. Basing on the Sen’s theory, any entrepreneurial capacity development
enabling acquisition of competencies needed by entrepreneurs should among other things
lead to improve competencies (e.g., overcoming technical, behavioral and managerial
barriers) and functionings (success and survival of SMEs).
2.2.5. The link between entrepreneurial competencies and development of SMEs
Earlier studies exploring the link between entrepreneurial competencies and the
development of SMEs are reporting contradicting results. To some scholars like
Potapchuk (2015) it has been perceived that these contradictions are creating difficulties
to understand what entrepreneurial competencies really is and how should be evaluated
to inform its results and efficiency on development of SMEs.
Whitlock and Master (2006) reported that after four years of having attended and
completed entrepreneurship courses, interests in creating SMEs tended to dissipate
among students. This meant that implementation of capacity development does not tell
about behaviors (e.g. initiatives) to become successfully SMEs entrepreneurs. Also,
Luthje and Franke (2013) observed that no clear relationship has been demonstrated
between entrepreneurship education and individuals becoming entrepreneurs.
As opposed with above studies, Bayrón (2013) posted that entrepreneurial competencies
of students who complete an entrepreneurial program is expected to be higher than
student who do not complete such program. He insisted that it is necessary to study the
interaction between attending entrepreneurial education or training program and
becoming effective SMEs entrepreneurs. In the Potapchuk (2015) though it did not
explain this expected link, but it viewed that entrepreneurship education as a way to
develop entrepreneurship related capacities that results in a growth of individual and
social wellbeing. Additionally, Mori (2017) concluded by stating that increasing
competencies of women entrepreneurs is necessary to successfully run their businesses.
21
In the same pipeline, Pansiri and Temtime (2014), observed that if entrepreneurial
program and policies are to yield better results, there is need to improve accessibility and
affordability to entrepreneurship education and training programs. The same
observations are insisted under Article 7 of the World Declaration on Higher Education
for the 21st Century which instructs that developing entrepreneurial skills and initiatives
should become a major concern of the Higher Education so that the graduates (even the
society) to graduate saturate with graduates and individuals possessing competencies
needed for effective creation and management of SMEs.
Experience in Tanzania show that among 100 new established SMEs; only 5 survive to
five years, the rest die within the first six month, others within two years and the
remaining within three years in Tanzania (TAPBDS, 2015). As the contradiction among
scholars continued over years and decades, none of the existing literatures may explain
this phenomenon.
Also, no further analysis has been made to inform whether successful and surviving
SMEs are created and owned by individuals who attended (or attending regularly) any
entrepreneurial capacity development courses. No analysis telling that SMEs which fail
and die soon after commencement are created and managed by individuals who have not
attended entrepreneurship capacity development program. Hence, the study needed to
clarify this issue by investigating how entrepreneurial competencies were utilized among
entrepreneurs for the development of SMEs.
2.3. Empirical literature
2.3.1. Studies in Tanzania
The first study of this category is the research by Mwasalwiba (2017) entitled University
entrepreneurship education in Tanzania. The primary data was gathered by interviewing
10 University lecturers and by administering 1124 questionnaires to students in four
Universities who pursued businesses and entrepreneurship courses. Entrepreneurial self-
22
efficacy and intentions were gathered before and after students undertaken the course. To
complement primary data, secondary data were gathered from various documents such as
course-outlines and government policies relating to entrepreneurship and higher
education were used to obtain the secondary data.
Mwasalwiba (2017) found that education on entrepreneurship was not likely to yield
desired results of increasing self-efficacy in becoming entrepreneurs due to a miss-match
between the teaching objective and the applied methods. “… the methods, being more
theoretical, failed to engage the students in learning activities that build the skills and
capacities for new business ventures creation …” (p.123). According to Mwasalwiba
(2017), if entrepreneurship education enabled individuals to acquire required
competencies may influence effectiveness of SMEs. Also, it means that if such
competencies are not acquired it is likely to decrease self-efficacy and initiatives to
effectively manage SMEs.
The next study is the research by Mori (2014) on the women’s entrepreneurship
development in Tanzania: Insights and recommendations. The main objective of the study
was to identify the major deficiencies in the conditions affecting the emergence of women
entrepreneurs and the ability of women owned enterprises to access the necessary
resources and supports for sustainability and growth of an equal opportunity basis.
Having identified the challenges continued to affect success of women owned enterprises,
Mori (2014) suggested that if women owned enterprises are to sickbed, there should be
the effective policy coordination between required entrepreneurial support to women and
SMEs policies and initiatives.
The study by Mori (2014) highlighted areas needing improvement for development of
women owned enterprises such as promotion of financial literate programs alongside
management skills training for women, provision of range of supporting services such as
marketing, customer care and sales, provision of training support such as mentoring,
23
coaching, networking, ICT facilities and other needs based workshops and increase
women skills and competencies to successfully run their businesses. This study
recognized the role of capacity development programs (e.g. coaching, mentoring and
workshops) in improving entrepreneurial competencies and success of SMEs. Also, Mori
(2014) pointed the need for behavioral competencies (e.g. networking and customer care),
technical competencies (e.g., finance and marketing knowledge and skills) and
managerial skills for the success of women owned enterprises.
The last empirical study in Tanzania is the research by Madatta (2015) which examined
the role of entrepreneurial competencies on the success of the SMEs in Tanzania. The
main aim of the study was to examine the extent to which entrepreneurial competence
influenced business success in SMEs. Simple random sampling was decided to enhance
sampling of SMEs scattered over local areas in the Municipalities and a total of 60 SMEs
(30 from each municipality) were sampled for inquiry.
Madatta (2015) found that there were individuals who started and operated SMEs who
had limited entrepreneurship capacities in terms of the attitudes, motivation, exposure,
skills and experiences. He found that entrepreneurship and business education and
training programs had greater opportunity to improve capacities of those who start and
operate businesses. Hence, it recommended that education and training should be treated
as crucial aspects for growth, development and success of SMEs in Tanzania.
2.3.2. Studies outside Tanzania
The first research of this category is that of Lopez and Pastor (2015) which explored the
development in rural areas through capacity building and education for businesses in
Spain. The methodologies used by the study involved tools which permitted involvement
of various actors of the area from the early planning stages and interactions between
potential and existing entrepreneurs with mentors. University students, entrepreneurs and
individual members of rural communities were purposefully selected and included in the
24
study. The observations were recorded over time and finally the study was able to explain
implementation of an entrepreneurship program and designing a plan of capacity building
and education for business in order to promote the development of rural areas in Spain.
Lopez and Pastor (2015) study observed that development programs designed to foster
entrepreneurship in rural areas must be accompanied by a capacity building and education
for business in order to promote the development of rural areas. The main purpose of
these plans is to encourage the promotion of entrepreneurial initiatives that affect the
revitalization and development of rural areas. It observed further that, the design of the
capacity building and education plan should take into account the resources and the needs
of the population and should identify current economic activities and new activities which
because of their potential, can be undertaken in the territory.
The next study is that of Bayrón (2013) entitled ‘social cognitive theory, entrepreneurial
self-efficacy and entrepreneurial intentions: tools to maximize the effectiveness of formal
entrepreneurship education and address the decline in entrepreneurial activity’. The aim
of the study was to help determination of the best teaching strategies and identify career
counselor competencies and possible contributions to the entrepreneurial education field.
Secondary data were extracted through literatures review and their content was analyzed
to enhance deeper understanding and explanation of the subject matters investigated. The
study came up with postulates that entrepreneurial competencies of students who
complete an entrepreneurship program will be higher than students who do not complete
such program. This study concurred assumption by Sen’s Capability Theory built under
assumption that development of competencies increases one’s choices of what he/she can
perform and achieve successfully.
The other is that of Muthoni (2013) on the influence of capacity building on financial
performance and growth of women owned small and medium enterprises in Gikomba
market in Kenya. The purpose of the study was to establish the influence of capacity
25
building strategies on financial performance and growth of women owned SMES. The
study employed descriptive survey research design and the population of the study was
women owning Small and Medium Enterprises (SMEs) at Gikomba Market in Nairobi
County. The proportionate simple random sampling technique was used to identify 357
respondents. The required data was gathered using observation and interviews methods
and analyzed using qualitative techniques (explanations and logical descriptions of data)
and quantitative analysis through descriptive statistics.
Muthoni (2013) found that training on entrepreneurship was critical in enhancing
financial performance and growth of women owned SMEs and the networking skills
development strategy was a key strategy required to enhance the performance and growth
of women owned SMES. According to Muthoni (2014), majorities of the women
entrepreneurs were empowered in managing their businesses through the various
empowerment forums that they attended which helped women to better manage their
SMEs and improve their profitability.
Furthermore, majorities of the women entrepreneurs lacked critical leadership skills in
managing their SMEs which slowed down the growth of women owned SMEs as they
had never attended leadership training. The leadership strategy was reported to enhance
business management as well as recruitment and upward mobility of women to position
of business top management and decision-making. In this study the influence of
entrepreneurial capacity development and SMEs performance seems to be clear
(Muthoni, 2014). Muthoni did not make further analysis on the specific competencies
needed for success of SMEs and how well capacity building enabled acquisition of those
competencies which influenced financial performance and growth of women owned
small and medium enterprises in Kenya.
26
2.4. Knowledge gap
Despite empirical evidences that entrepreneurial capacity development is increasingly
gaining attention among researchers, the reseracher found no evidence that
entrepreneurial competencies needed by SMEs and how well capacity development
programs are facilitating acquisition of these competencies among entrepreneurs have
been explained. For instance, Lopez and Pastor (2015) commented that in order to foster
entrepreneurship in rural areas, capacity building and education for business was
required. Although, Lopez and Pastor (2015) study failed to state clearly what
competencies were really needed and how capacity building and education program
facilitated acquisition of those competencies.
The studies by Mwasalwiba (2017), Madatta (2015) and Mori (2014) which have pointed
competencies needed by SMEs entrepreneur’s did not describe these competence and
how education and capacity development programs has enabled SMEs entrepreneurs to
acquired competencies in question. Bayrón (2013) and Muthoni (2013) who attempted to
link the businesses capacity of individuals with perceived ability to create and develop
SMEs did not provide reasons why there has been increasing failure of SMEs while
capacity development programs are increasing rapidly in Tanzania. In order to cover the
gap, researcher was motivated to seek understanding of the entrepreneurship capacity
development for SMEs in Tanzania focusing on stationery services in Ilala municipality.
2.5. Conceptual framework for understanding entrepreneurial capacity
development for SMEs in Tanzania
The conceptual framework guiding the study assumes that the development of SMEs was
being dependent on competency need by SMEs entrepreneurs, competency acquisition
among SMEs entrepreneurs and competency utilization among SMEs entrepreneurs. The
relationship between variables is shown by Fig.2.1.
27
Figure 2. 1: Conceptual framework on the understanding entrepreneurial capacity
development for SMEs in Tanzania
Source: Researcher’s own construct 2019
2.5.1. Competency need by SMEs entrepreneurs
Competency need refers to category of competencies needed by SMEs entrepreneurs
(Lopez and Pastor, 2015) such as technical competencies, behavioral competencies or
/managerial competence or all of them (Lopez and Pastor, 2015; Armstrong, 2010;
Morgan and Saxby, 2007). The technical competency is required to interpret and use
business policies and regulations, personal attitudes, skills and related experience needed
by SMEs entrepreneurs, the managerial competencies are required in managing relations
with workers, customers and suppliers and all affairs of the SMEs while behavioral
competencies are required to assist SMEs entrepreneurs in setting challenging goals,
creating own measures of excellence and seeking ways of improving SMEs performance,
working anticipatively and develop positive relationships with colleagues (Lopez and
Pastor, 2015)
2.5.2. Competency acquisition among SMEs entrepreneurs
Competency acquisition refers to a planned process which the competencies needed
should be given to respective SMEs entrepreneurs (Morgan and Saxby, 2007; Lopez and
Development of SMEs
Independent variables Dependent variable
variables
Competency needs by SMEs
entrepreneurs
Competency acquisition among
SMEs entrepreneurs
Competency utilization among SMEs
entrepreneurs
28
Pastor, 2015) which can take place through planned meetings between entrepreneurs and
mentors (Lopez and Pastor, 2015) or entrepreneurial education and training courses
(Bayrón, 2013; Mwasalwiba, 2017).
2.5.3. Competency utilization among SMEs entrepreneurs
Competency utilization refers to usage of one’s competencies in business activities which
informs and predicts whether or not particular SMEs will succeed or fail (TAPBDS, 2015;
Lopez and Pastor, 2015). Competency utilization intertwins competency needs and
competency acqusition. In this account, utelization of required competencies by those
possessing them explains why some SMEs enterpreneurs develop and manage their SMEs
longer while others not (Lopez and Pastor, 2015).
2.5.4. Development of SMEs
Development of SMEs measures the extent which SMEs achieve the expected results
(Gupta, 2005). As demonstrated by Isaga et al. (2015) and Mawere (2018), development
of SMEs may be measured basing on criteria such as extent to which SMEs generate
profit, attract and retain customers or meets the needs and expectations of customers. In
order to measure development of SMEs, the current study focused on the profit, loss and
survival of SMEs in stationery services.
CHAPTER THREE
METHODOLOGY
3.1. Introduction
This chapter about research methodology explains the methods and techniques adopted
by researcher during execution of the study for coming up with valid finding results. The
methods and techniques elaborated are; the research design, area of the study, target
29
population, sampling techniques and sample size, data collection methods and data
analysis procedure.
3.2. Research design
A research design is a general plan on how one goes about answering the research
question (Saunders, Lewis and Thornhill, 2000). Henn, Weinstein and Foard (2015)
defined research design as a strategy of shaping the research. Like a strategy, the research
design should elaborate how the study should be carried out so as to realize the objectives
by finding answers to questions driving the study.
The research design adopted by this study was the survey design which enabled asking
individuals about their perceptions, attitude, experience or knowledge to describe the
phenomenon, that is; entrepreneurial capacity development for development of SMEs
(Mugenda and Mugenda 2003). The gathered perceptions, attitudes, experience and
knowledge of the studied population were useful to achieve three objective of this study
which were: to describe entrepreneurial competencies needed for effectiveness of SMEs
entrepreneurs, to describe how entrepreneurial capacity development contribute in
acquisition of entrepreneurial competencies needed by SMEs entrepreneurs and to find
out how entrepreneurial competencies are utilized for development of SMEs.
3.3. Area of the study
The area of the study refers to a physical place within which researcher conduct an inquiry
of the phenomenon (Henn et al., 2015). In selecting the area of the study, it must be in
the minds of researcher that the problem can be studied successfully in particular area by
soliciting data from physical things or people who are familiar with the problem (Henn
et al., 2015). For the purpose of this study, Ilala Municipality was the area of study. This
was because the municipality is one of the local administrations in Dar es Salaam region
which is well-known as the ‘leading business center’ of the country. Considering that the
SMEs have continued to be the leading businesses carried out in the country (Salim,
30
2012), they also formed the majorities of the business enterprises which operated in Ilala
Municipality. This offered appropriate number of SMEs in stationery services to
accomplish the study.
3.4. Population
The target population refers to the things or people who the study intends to obtain
required information (Henn et al., 2015). It also determines the quality of individuals
likely to contribute their opinions, perceptions and attitudes in answering questions asked
by researcher (Muthoni, 2013). Selection of right target population informs whether or
not data was gathered from right individuals or authorities and whether the data were
relevant (Muthoni, 2013).
As the study wanted to seek understanding of the entrepreneurial capacity development
for SMEs in stationery services in Tanzania, the suitable target population was the owners
and managers of SMEs in stationery services. As noted by Khan, (2010) and Isaga et al.
(2015), SMEs in Tanzania is used to mean micro, small and medium enterprises whose
characteristics are given in table 3.1. Hence all SMEs in stationery services in Ilala
Municipality which possessed the stated characteristics formed the target population.
Table 3. 1: Classification of SMEs in Tanzania
Enterprise
Category
Number of
Employees
Capital Investment (TShs)
Micro enterprise 1-5 Up to 5,000,000
Small enterprise 5 – 49 Above 5,000,000 to 200,000,000
Medium enterprise 50 – 100 Above 200,000,000 to 800,000,000
Source: Isaga et al. (2015) p. 197
3.5. Sampling design
3.5.1. Sampling techniques
Sampling techniques are the methods for selection of portion of the entire population for
representation during data collection (Ndunguru, 2007). The sampling techniques used in
31
this study is non-probability sampling technique specifically, judgmental sampling
technique. Using this technique, researcher employed his own judgments to select owners
and managers of SMEs in stationery services basing on their information richness and
willingness to participate by providing required information. Also, it ensured that
questionnaires were give to owners and managers of stationery services who attended
some sort of entrepreneurial capacity development programmes.
The above sampling techniques is very common in most of social science studies as it
increases information reliability (Muthoni, 2013) and the most recommended sampling
technique among researches whose study population lacks an up-to-date and accurate
sampling frame (Isaga et al., 2015). Despite that SMEs occupy more than 98% of all
business enterprises in Tanzania; accurate number of SMEs is almost lacking (Isaga et
al., 2015). That is why judgmental sampling technique that is not be bothered by lack of
an up-to-date and accurate number of SMEs in Ilala was necessary for this study.
3.5.2. Sample size
A sample refers to total sum of the individuals selected to represent the whole population
in the study (Henn et al., 2015). According to Nchimbi (2002) a sample should possess
the information which the study wants to gather. Thus, it must be a good representation
of essential characteristics of the entire population within which the study is being
conducted. The sample size of this study was determined using researcher’s own
judgments on how many representatives of SMEs in stationery services were appropriate
to accomplish the study. This approach of sample determination is very common where
researcher is confronted by lack of an up-to-date and accurate data of the total study
population (Mathew, Attman, Campbell and Royston; 2000; Hulley and Cummings,
2001; Isaga et al., 2015) Using the above approach total of 100 SMEs in stationery
services in Ilala Municipality formed a sample. Whether or not SMEs to constitute a
sample using this technique depended on researcher’s own judgments that owners or
managers of stationery services possessed desired characteristics such as
32
College/University education, English literate and entrepreneurial/business education,
training or workshops.
3.6. Data collection approaches
3.6.1. Questionnaires
Questionnaires comprise the series of questions which individual respondent should
answer at his/her convenient time. This method is widely accepted in collection of
primary data due the ability to give respondent free time to think and generate answers
for their own. The closed ended questions formed the questionnaires in line with
comments by Henn et al. (2015) that social studies can be observed, recorded and
measured. In order to facilitate measurement, all questions were constructed using Likert
scales of five points. The respondents were required to rate the extent which they agreed
or disagreed with each statement in each subject matter examined. The questionnaires is
appended in the appendix part of this dissertation
3.6.2. Documentary review
The documentary review was the secondary data source used by the researcher to
complement the data obtained using questionnaires. The documentary review involved
gathering secondary data by collecting relevant documents on the entrepreneurial
capacity education/training courses and SMEs (e.g., curricular) from selected Higher
Learning Institutions (HLIs) in Tanzania.
3.7. Operationalization of research questions
The research questions were operationalized in a manner shown in Table 3.2.
Table 3. 2: Operationalization of research questions and variables
33
QN Question Variables Indicator Research
instruments
1
What are the
entrepreneurial
competencies required by
SMEs entrepreneurs in
stationery services in Ilala
Municipality?
Entrepreneurial
competencies
Possessing
Lacking Questionnaire
s,
success of
SMEs
Profit
Survival
2
How entrepreneurial
capacity development has
contributed towards
acquisition of
entrepreneurial
competencies required by
SMEs entrepreneurs in
stationery services at Ilala
Municipality?
Capacity
development
programs
Program
contents
Coverage Questionnai
res &
Documentar
y review
Acquisition of
entrepreneurial
competencies
Attendance
Completion of
the program
Success of
SMEs
Profit
Survival
3
How entrepreneurial
competencies are utilized
for development of SMEs in
stationery services at Ilala
Municipality?
Entrepreneurial
competencies
Possessing
Lacking Questionnaire
s Development of
SMEs
Profit
Loss
Survival
Source: Researcher’s construct 2018
3.8. Data analysis procedure
Data analysis refers to the logical and structured way of establishing relationships of the
opinions into a meaningful way (Henn et al., 2015). During data analysis, the rated
responses were coded into numbers and entered into Statistical Package in Social Science
(SPSS) version 20 for analysis using descriptive statistics. The analyzed data was
presented using frequency tables and Bar charts. The secondary data from relevant
documents were analyzed by scrutinizing the contents of the respective documents.
3.9. Validity and reliability
Accordion to Henn et al. (2015), validity refers to generation of ‘real’, ‘rich’, and ‘deep’
data. On the other hand, reliability defined as the generalization of ‘hard’ data that is
replicable by other researchers. Authors noted that validity increases with the
34
combination of different approaches and methods in the same research project through a
process commonly such as multiple methods of data collection which reduces the impact
of personal bias. Also, authors opined that enabling others to check that data collection
tools are appropriate or were consistently applied in a professional manner, faithfully and
with prime consideration of the voices of respondents increase reliability.
Equally, in order to increase validity of the study, the researcher triangulated the study
using both questionnaires and documentary review. The agreements and deviations
between data sets were determined and explained. In order to increase reliability, the
research questions were subjected under review by peers and research experts for the sake
of their opinions, suggestion and areas which needed improvement.
3.10. Research ethical issues
Krishnaswami and Ranganatham (2009) contended that research ethical issues are those
research standards set by relevant authorities to guide conducts and behaviors of
researchers. According to authors, research ethics are foundations issues in increasing
trustworthiness of researches. During the study, researcher observed ethics such as
abiding the research time, standards and guidelines stated by the Mzumbe University and
the Supervisor. Also, researcher obtained permission letter for data collection from the
University for presentation to relevant authorities and SMEs entrepreneurs in Ilala
Municipality.
35
37
CHAPTER FOUR
PRESENTATION AND DISCUSSION OF FINDINGS
4.1. Introduction
In this chapter, the researcher is presenting and making discussions of the findings basing
on the survey data which was gathered to understand the entrepreneurial capacity
development for SMEs in Ilala Municipality. The findings are presented into four
subheadings namely; the background information of the surveyed respondents and
stationeries, entrepreneurial competencies required by SMEs entrepreneurs in stationery
services, ways which entrepreneurial capacity development contributes towards
acquisition of competencies required by SMEs entrepreneurs in stationery services and
ways which entrepreneurial competencies are utilized for development of SMEs in
stationery services in Ilala Municipality.
4.2. The basic information of the surveyed respondents and stationeries
4.2.1. The basic information of the surveyed respondents
In order to gather basic information of the surveyed respondents, six variables were
studied: sex, education, specialization in the College/University education, experience in
stationery entrepreneurship, title in the stationery service and opinion regarding survival
of the stationery in the coming five years. These variables were chosen because of their
influence on the development of SMEs as reported differently by earlier researchers.
Consistently, the current study used variables such as sex, education level, and
specialization in the college/University and experience in stationery services to qualify
the patterns of observed results on each objective. The closed ended questions were used
and hence, all respondents were required to tick in the appropriate boxes. The results of
the findings were presented by Table 4.1(a) and 4.1 (b) found in page 39 and 40 of this
dissertation.
Basing on the results portrayed in Table 4.1(a), the surveyed samples comprised more
females (65%) that males (35%). Of the surveyed samples, 72% had technical education,
38
23% had ordinary diploma while 5 % had bachelor degree and above. Among them, 17%
specialized in entrepreneurship education, 29% business education, 15% accounting and
financing and the majorities (39%) were from management related courses specifically;
information and communication technology, secretarial studies, office administration and
customer care.
Having more females than males in the surveyed samples would be caused by suitability
of females in stationery services due to possession of basic qualifications such as typing,
office management and customer care. Hence, the owners of stationeries services would
have preferred employing more females in their stationeries than males. The results
seemed consistent with report by Nchimbi (2002) which observed that there were more
females involved in entrepreneurship in Tanzania than males. Nchimbi (2002) argued that
motivation, individual characteristics and perception of business success accounted the
observation. All the same, female characteristics and motivation to engage into secretarial
studies, typing, office management and customer care would support the observed results.
Basing on the College/University education of the surveyed respondents, individuals with
management related courses dominated stationery entrepreneurs (39.0%). This supported
earlier studies such as Lopez and Pastor (2015), Mwasalwiba (2017) and Mzomwe (2015)
in which education background individual was observed insignificant determinant of
becoming entrepreneur. Also, they would be useful support to argument posed by Luthje
and Franke (2013) that no clear relationship is demonstrated between entrepreneurial
capacity development and becoming SMEs entrepreneurs. That is why, not only
individuals who had background education/knowledge in entrepreneurship and
businesses formed the stationery ventures in Illala Municipality. Instead, those with
management related education courses dominated the surveyed samples.
Table 4.1(a): Basic information of the respondents
39
1. Sex Frequency Percent
Male 35 35.0
Female 65 65.0
Total 100 100.0
2. Education level Frequency Percent
Technician certificate 72 72.0
Ordinary diploma 23 23.0
Bachelor degree and above 5 5.0
Total 100 100.0
3. Specialization into College/University education Frequency Percent
Entrepreneurship 17 17.0
Business education 29 29.0
Account and finance 15 15.0
Management related education 39 39.0
Total 100 100.0
Source: Survey data, 2019
Meanwhile, the results in Table 4.1(b) revealed that majorities of the surveyed samples
(34%) had experience in stationery service between 6-10 years followed by those with 1-
5 years (31%) and those who had more that 15 years in stationery services (19%). The
results however, were not capable to compare with claims raised by TAPBDS (2015) that
among 100 new established SMEs; only 5 survive to five years, the rest die within the
first six month, others within two years and the remaining within three years because the
study did not capture data on the number of stationeries established in the same time so
as to discover those which failed over time.
Also, Table 4.1(b) showed that the surveyed samples comprised more workers (47%)
than both, the managers (29%) and the owners and managers of the stationeries (24%).
This implied that most owners and manager were not directly involved in day-to-day
operations of the stationeries. That is why during the time of study, there were not found
in the respective stationery offices. Also, it would be because of nature, size of
stationeries and relationships since workers were trusted to operate most of the stationery
activities without need of close supervision by the owners or managers.
40
Additionally, the results portrayed that majorities of the surveyed respondents were in
opinions that their stationeries were likely to survive in the coming five years basing on
profit and loss record (59%) compared with 41%who were not sure.
Table 4. 2(b): Basic information of the respondents
1. Experience in the stationery entrepreneurship Frequency Percent
1-5 years 31 31.0
6-10 years 16 16.0
11-15 years 34 34.0
Above 15 years 19 19.0
Total 100 100.0
2. Title in the stationery Frequency Percent
Owners and managers 24 24.0
Managers 29 29.0
Workers 47 47.0
Total 100 100.0
3. Opinion regarding survival of the stationery in coming
five years basing on profit and loss record
Frequency Percent
Likely to survive 59 59.0
Unlikely to survive 41 15.0
Total 100 100.0
Source: Survey data, 2019
Further analysis was made by relating the opinion regarding survival of the stationery
services in the coming five years basing on profit and loss records and respondents
education level, areas of specialization in the College/University education as well as
their experience in stationery services. The results were as shown by Fig.4.1 in the next
page of this dissertation.
Among 59 (59.0%) respondents who opined that their stationery services were likely to
survive in the coming five years basing in profit and lost records (Table 4.1b), comprised
all bachelor degree holders (5 respondents) and almost all diploma holders (20) and the
rest (34 respondents) had technician certificates.
41
Besides, of 59 (59.0%) respondents, majorities had entrepreneurship education (15
respondents) and business education (28 respondents). Meanwhile, accounting and
financing and management related courses contributed very few respondents, that is; 4
and 14 respondents respectively.
Also, among 59 (59.0%) respondents, it comprised all who had work experience of above
15 years (19 respondents), most of those with 11-15 years (24 respondents) and 6-10
years (11 respondents) and the few were those who had 1-5 experience (5 respondents).
Figure 4. 1: A survey on the survival of the stationeries in the coming five years
basing on profit and loss records.
Source: Survey data (survival of the stationeries in the coming five years basing on profit
and loss records), 2019
Basing on Fig.4.1, opinion on the survival of the stationery services in the coming five
years had association with level of education of the surveyed samples, their background
education and knowledge and experience in stationery services.
5
11
24
19
15
28
0
14
34
20
5
26
5
10
0 2 1
25 25
38
3 10
5
10
15
20
25
30
35
40
Likely to survive
Unlikely to survive
42
4.2.1.1. Association between the survival of the stationeries in the coming five years
and level of education of the surveyed stationery entrepreneurs
The results showed that confidence of the respondents on the survival of the stationery
service in the coming five years increased with respondent’s level of knowledge. Out of
72 samples with technician certificate, only 34 out of 72 opined that there businesses were
to survive in the coming five years compared with the rest 52 who opined that their
stationeries were not to survive.
Among those with ordinary diplomas, 20 out of 23 were confident that their stationeries
were to survive in the coming five years. Meanwhile, all 5 surveyed samples with
bachelor degrees and above were confident that their stationery services were to survive
in the five coming years.
The results above supported postulates by Amrtyan Sen Capability Theory viewing
people capability (e.g.; level of education) as the most relevant factor for understanding
and evaluation of choice of life wellbeing (Sen, 1992). Basing on the theory, the results
translated that that level of education of individual entrepreneurs increases his/her
capabilities and confidence. At the same time they were inconsistent Bayrón (2013) report
basing in the United Kingdom claiming that following attendance and completion of
entrepreneurial/ business courses, the interests in creating business ventures tended to
dissipate.
4.2.1.2. Association between survival of the stationeries in the coming five years and
entrepreneurial/businesses related education/knowledge of the surveyed stationery
entrepreneurs
Figure 4.1 showed that 15 out of 17 surveyed samples who had entrepreneurship
education opined that their stationeries were to survive in the coming five years.
Consistently, those with business education, 28 out of 29 opined that their stationeries
were to survive in the coming five years. In the contrary, the confidence decline sharply
43
whereby only 4 out of 11 who had accounting and financing education were confident
with survival of their stationeries, the same figure with those who had management
related courses (14 out of 25 respondents). These results supported ‘individual
functionings’ postulated in the Amrtya Sen Capability Theory. Sen (1999) explained
functioning basing on ones education and knowledge in the subject matter.
According to Sen, functionings depends on the ability to operationalize particular
business successfully. This would depend on the related education and knowledge (Sen,
1999). Basing on the fining results, possession of entrepreneurship and businesses
education were key source of skills, cognitive abilities and personal beliefs to
operationalize and ensure success and survival of the surveyed stationery services.
In the same line, the results agreed with postulated by Bayrón (2013) that entrepreneurial
competencies of students who complete an entrepreneurship program will be higher than
students who do not complete such program which concurred assumptions by Sen’s
Capability Theory built under assumption that development of competencies increases
one’s choices of what he/she can perform and achieve successfully.
Consistently, the results supported Armstrong (2010) who recognizes one’s related job
education and knowledge as the key for his/her superior performance. Also, the results
supported earlier scholars reporting that entrepreneurship related education and
knowledge are essential for the success of business ventured (OECD (2004; Pansiri &
Temtime, 2014; Mwasalwimba, 2017). Though, they were inconstant with the study by
Luthje and Franke (2013) claimed that there was no clear relationship between
entrepreneurial capacity developments and becoming successful SMEs entrepreneurs.
4.2.1.3. Association between survival of the stationeries in the coming five years and
experience in stationery services among the surveyed stationery entrepreneurs
Among the surveyed respondents who had experience in stationery services between 1-5
years only 5 out of 26 were confident with the survival of their stationeries in the coming
44
five years. There was extremely difference with those who had more than 15 years of
work experience in stationery services whereby all of them (19) were confident with the
survival of their stationery services. The results would support report by TAPBDS (2015)
that among 100 new established SMEs; only 5 survive to five years, the rest die within
the first six month, others within two years and the remaining within three years because
the study did not capture data on the number of stationeries established in the same time
so as to inform the number of those which failed over time.
4.2.2. Basic information of the surveyed stationery services in Ilala Municipality
In order to gather basic information of the surveyed stationeries, three variables were
studied: number of workers, estimated capital of the stationery and years of
commencement of the stationery. The closed ended questions were used and hence, all
respondents were required to tick in the appropriate boxes. The results of the findings
were as presented in Table 4.2 found in page 45 of this dissertation.
Table 4.2: Basic information of the surveyed stationeries
1. Total number of workers of the stationery service Frequency Percent
1-5 workers 94 94.
6-10 workers 6 6.0
11-15 workers 0 0.0
0.16-20 workers 0 0.0
Above 20 0 0.0
Total 100 100.0
2. Estimated capital invested into the stationery Frequency Percent
Up to 5 million 13 13.0
5 – 200 million 87 87.0
45
200 – 800 million 0 0.0
Total 100 100.0
3. Year of commencement of operations by the stationery Frequency Percent
Less than five years ago 30 30.0
About 5 years ago 7 7.0
More than five years ago 63 63.0
Total 100 100.0
Source: Survey data, 2019
The finding results in Table 4.2 showed that most of the surveyed stationeries employed
1-5 workers (94%). The rest (6%) had 6-10 workers. While researcher observed that the
number of workers was determined primarily by the size of stationery, scope of services
and number of customers, it also showed that all the surveyed stationeries fallen under
SMEs. According to Isaga et al. (2015) SMEs in Tanzania is used to mean micro
enterprises (employing 1-5 workers), small enterprises (employing 5-49 workers) and
medium enterprises (employing 50-100 workers) (p.197). It means that most of the
surveyed stationery services were micro enterprises (94%) followed by small enterprises
(6%). None of them were medium enterprises.
Again, Table 4.2 showed that only 13 (13%) of the surveyed stationeries had capital
investment up to 5 million. The rest 87 (87%) had capital investment above 5 to 200
million. None had capital investment from 200 - 800 million. While the observed results
would be caused by differences in the size of the surveyed stationeries and the basic
machines and facilities employed by the stationeries such as photocopy machines,
printers, scanners and laminating machine altogether which could cost about 7 million,
they also reflected the nature of SMEs which were covered. Basing on Isaga et al. (2015),
as the study surveyed only micro and small enterprises, the capital investment was
expected at micro enterprise capital level (up to 5 million) and small enterprise capital
level (above 5 million to 200 million).
46
On top of that, Table 4.2 revealed that during the study majorities of the surveyed
stationeries (63%) had more than five years of operations, followed by those which had
less than five years (30%) and the rest (7%) had about five years during the study. All the
same, these results were not capable to compare with claims by TAPBDS (2015) that
among 100 new established SMEs; only 5 survive to five years, the rest die within the
first six month, others within two years and the remaining within three years because the
study did not capture data on the number of stationeries established in the same time so
as to inform those which failed until the time of study.
Further analysis was carried out to see the association between the profit and loss record
of the stationery in the past five years with the year of commencement of the stationery
services and the background education/knowledge of the stationery owner, manager or
workers.
The results revealed that only 73 (73.0%) of the total 100 surveyed respondents agreed
that their stationery services earned profits in the past five years consecutively. The rest
27 (27%) indicated that they experienced annual loss or losses in the consecutive five
years. These results indicated associations between earning profits by the stationery in
the past five consecutive years and years of business operations and education/knowledge
background of the stationery owner, manager or workers as shown in Fig.4.2
Figure 4. 2: Surveyed stationeries in terms of profit making in the past five
consecutive years
47
Source: Survey data (position of stationery service in terms of profit and loss), 2019.
4.2.2.1. Association between earning profit by the stationery in the past five
consecutive years and length of time from commencement of business operations
Among 73 (73%) who experienced profits in the consecutive five years, 31 respondents
were those with experience in stationery service between 11-15 years followed by those
with experience in the stationery services was above 15 years (17 respondents) and those
whose experience between 6-10 years (15 respondents). The few were those whose
experience in stationery service fallen between 1-5 years (10 respondents).
The lesson from the results was that abilities of earning profit by the stationery increased
with years of businesses operations by the stationery. For instance, the respondents from
stationeries which had 1-5 years of business operations only 10 out of 31 earned profit in
the consecutive five years. This was comparatively very few compared with those who
had above 15 years of business operations indicated that 17 out of 19 made profit in the
consecutive five years. These results supported that experience increases ones’ abilities
for superior performance and success (Armstrong, 2010). They also supported research
10
15
31
1715
19
7
32
21
1 3 2 2
108 7
0
5
10
15
20
25
30
35
Earned profit
Incurred loss
48
by Lopez and Pastor (2015) that planned experience into entrepreneurship increased
success of managing entrepreneurship venture. They would also explain the high rate of
failure of the newly established business ventures in Tanzania (TAPBDS, 2015).
4.2.2.2. Association between earning profit by the stationery in the past five
consecutive years and background education and knowledge of individual
entrepreneur
The study revealed that 73(73.0%) respondents agreed that their stationery services
earned profit in the past five years consecutively, majorities had background education in
management related courses (32 respondents), followed business education (19
respondents), entrepreneurship education (15 respondents) and accounts and finance (7
respondents).
Basing on the above results, no clear association between abilities of the stationery to
earn profits and education/knowledge background of the owner, manager or workers
because 15 out of 17 respondents who had entrepreneurship education made profits in the
consecutive five years which was almost similar to 32 out of 39 respondents who had
background education/knowledge in management.
This would be caused by relevant experience whereby ones abilities increases with
experience in entrepreneurship (Armstrong, 2010), and hence, supporting the report by
Luthje and Franke (2013) claims that no clear relationship between entrepreneurial
capacity development and becoming successful SMEs entrepreneurs.
4.3. Description of the entrepreneurship competencies needed by SMEs
entrepreneurs in stationery services in Ilala Municipality
The data required to describe entrepreneurial competencies needed by SMEs
entrepreneurs in stationery services was gathered using Likert scale questionnaires and
49
the surveyed stationery services entrepreneurs were asked to indicate the extent they
agree or disagree with the need of each competency. The needs of competencies were
ranked from 5 [highest needed] to 1 [not needed].
The results showed that the abilities to manage business matters of the stationery
(managerial competency) and abilities to formulate business plans, budgets and policies
and regulations (technical competency) were the highly needed competencies with mean
values of 4.5 and 4.49 respectively. In the next rank of need, respondents shown that they
needed the abilities of seeking new ways of improving business performance (behavioral
competencies), the abilities to manage relationships with customers of the stationery
(managerial competency) and the abilities to manage relationships with workers of
stationery (managerial competency) whose mean values were 4.11, 3.8 and 3.7
respectively. A summary of these results are shown in Table 4.3 in page 50 of this
dissertation.
The results supported that development of stationery entrepreneurship needed
combination of three categories of competencies (behavioral, managerial and technical
competencies) (Lopez and Pastor, 2015; Armstrong, 2010; Morgan and Saxby, 2007).
The managerial competencies (abilities to manage business matters of the stationery, the
abilities to manage relationships with customers of the stationery and the abilities to
manage relationships with workers of stationery) dominated competency needs among
the surveyed stationery entrepreneurs. In line with study by Mori (2014) these
competencies would be essential for the growth and development of stationeries in
general.
Table 4.3: Description of the entrepreneurship competencies required by SMEs
entrepreneurs in stationery services in Ilala Municipality
Description of the competencies N Total
score
Mea
n Meaning
50
Scor
e
Abilities of setting challenging business goal/s 100 191 1.91 Not needed
Abilities of creating own measures of excellence in my
business
100 210 2.10 Not needed
Abilities of seeking new ways of improving business
performance
100 411 4.11 Needed
Abilities of working participatively with fellows 100 243 2.43 Not needed
Abilities to manage relationships with workers of
stationery
100 374 3.74 Needed
Abilities to manage relationships with customers of the
stationery
100 380 3.80 Needed
Abilities to manage business matters of the stationery 100 450 4.50
Highly
needed
Abilities to formulate business plans, budgets and
policies and regulations
100 449 4.49
Highly
needed
Abilities to interpret business plans, budgets, policies
and regulations
100 200 2.00
Not
required
Source: Survey data, 2019
4.4. Ways which entrepreneurial capacity development contributed towards
acquisition of competencies needed by SMEs entrepreneurs in stationery services in
Ilala Municipality
The data required to describe ways which capacity development contributed towards
acquisition of the competencies needed by SMEs entrepreneurs in stationery services was
gathered using Likert scale questionnaires. The surveyed stationery services
entrepreneurs were asked to indicate the extent they agreed or disagreed with each way
of competency acquisition. The agreements with different ways were ranked from 5
[strongly agreed] to 1 [strongly disagreed]. A summary of the results are provided in
Table 4.4 in the next page of this dissertation.
Table 4.4: Ways which entrepreneurship capacity development contributed towards
acquisition of competences required by SMEs entrepreneurs in stationery services
in Ilala Municipality
51
Description of the ways of
competency acquisition N
Total
score
Mean
Score Meaning
From dedicated schools, colleges
or universities involved in the
provision of appropriate
entrepreneurial/business
education.
100 393 3.93
Agreed way of
competency
acquisition
Through planned interactions with
mentors (or role models) that have
excellent experience or knowledge
in entrepreneurship.
100
214 2.14
Not agreed way of
competency
acquisition
Direct from community based
entrepreneurship/business
education.
100
373 3.73
Agreed way of
competency
acquisition
Through different opportunities
for business and entrepreneurship
courses provided through short
courses, consultancies or
community outreach services.
100
422 4.22
Agreed way of
competency
acquisition
Source: Survey data, 2019
The results showed three ways which surveyed stationery entrepreneurs acquired
competencies they needed: through different opportunities for business and
entrepreneurship courses provided through short courses, consultancies or community
outreach services, from dedicated schools, colleges or universities involved in the
provision of appropriate entrepreneurial/business education and direct from community
based entrepreneurship/business education which had mean valued of 4.11, 3.9 and 3.75
respectively.
Competency acquisition through different opportunities for business and
entrepreneurship courses provided through short courses and consultancies or community
outreach services was mainly through attending entrepreneurial/business courses
arranged by individual experts, groups or local Colleges/Universities. Only long courses
were acquired by attending the dedicated College/University. This was supported by
Prospectus for 2018/19 academic years among five Universities: Mzumbe University,
52
College of Business Education, Tanzania Institute of Accountancy, and Institute of
Finance Management from which entrepreneurship and/or business course modules were
common and were targeting students in all discipline whether as the principal course or
elective courses. The similar results were explained by Mwasalwiba (2017) in his study
on entrepreneurship education in Tanzania which observed that most of local Universities
were providing entrepreneurial courses to their students and to local communities through
organized consultancies and outreach services;
Competency acquisition direct from community based entrepreneurship/business
education involved learning of individual entrepreneurs as the result of
engagement/practices and interaction with fellow and neighbor entrepreneurs. This
seemed more informal and unplanned method of competency acquisition. However, it
agreed with the study by Lopez and Pastor (2015) in the sense that it recognized the need
of social and business interactions and exchange of experiences and information about
entrepreneurship and businesses among the studied stationery entrepreneurs.
4.5. Utilization of entrepreneurial competencies for development of SMEs in
stationery services in Ilala Municipality
The data required to find out utilization of entrepreneurial competencies for development
of SMEs in stationery services among surveyed entrepreneurs was gathered using Likert
scale questionnaires. The surveyed stationery services entrepreneurs were asked to
indicate the extent they agreed or disagreed with each statement. The agreements were
ranked from 5 [strongly agreed] to 1 [strongly disagreed]. A summary of the results are
provided in Table 4.5 found in page 53 of this dissertation.
Table 4.5: Ways which entrepreneurial competencies were utilized for
development of SMEs in stationery services in Ilala Municipality
Statements about utilization of competencies for
development of SMEs N
Total
score
Mean
Score Meaning
53
Capacity development do not guarantee entrepreneurs
to establish profitable SMEs 100 480 4.80
Strongly
agreed
Entrepreneurial competency of individuals completed
business/entrepreneurship education/course should be
higher than one who not
100
392 3.92 Agreed
possession of business and/or entrepreneurship
education is a significant factor for operating profitable
SMEs
100
453 4.53 Strongly
agreed
Lack of business and/or entrepreneurship education is a
chief source failure of SMEs
100 342 3.42 Undecided
SMEs managed by individuals attended
business/entrepreneurial education have higher survival
potentials than which are not.
100
378 3.78 Agreed
Source: Survey data, 2019
Basing on the results, respondents strongly agreed that capacity development do not
guarantee entrepreneurs to establish profitable SMEs with mean value of 4.8. They also
strongly disagreed that possession of business and/or entrepreneurship education was a
significant factor for operating profitable SMEs with mean value of 4.53. Both results
would support Luthje and Franke (2013) who found no clear relationship between
entrepreneurial capacity developments and becoming successful SMEs entrepreneurs.
However, basing on the postulated by the Sen’s Capability Theory if one has related
education and knowledge in the business is likely to be successful that one who is not.
This is high supported by Bayrón (2013) study which came with postulates that
entrepreneurial competencies of students who complete an entrepreneurship program will
be higher than students who do not complete such program.
The same was supported by the field data in which respondents agreed that
entrepreneurial competency of individuals completed business/entrepreneurship
education/course should be higher than one who not and the SMEs managed by
individuals attended business/entrepreneurial education have higher survival potentials
than which are not whose mean values are 3.92 and 3.78 respectively.
54
55
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1. Summary
This study was involved to understand entrepreneurial capacity development for SMEs
in Tanzania. To achieve the rationale, a total of 100 stationery entrepreneurs in Ilala
Municipality were surveyed. The required data were gathered using closed ended
questionnaires as well as review of relevant documents. The outcomes were sought on
the following areas: description of entrepreneurial competencies needed by SMEs
entrepreneurs, description of the ways which entrepreneurial capacity development
contributes towards acquisition of competencies needed by SMEs entrepreneurs and
utilization of entrepreneurial competencies for development of SMEs in stationery
services.
From the survey data, the following were understood. First is that survival of the
stationery services had association with the level of education of the surveyed samples,
their background education and knowledge and experience in stationery services. For
instance, 15 out of 17 surveyed stationery entrepreneurs with entrepreneurship education
opined that their stationeries were to survive in the five years. Consistently, those with
business education, 28 out of 29 opined that their stationeries were to survive in the
coming five years. In the contrary, the confidence decline sharply whereby only 4 out of
11 who had accounting and financing education were confident with survival of their
stationeries, the same figure with those who had management related courses (14 out of
25 respondents). These results supported ‘individual functionings’ postulated in the
Amrtyan Sen Capability Theory. Sen (1999) explained functioning basing on ones
education and knowledge in the subject matter. Basing on the fining results, possession
of entrepreneurship and businesses education were key source of skills, cognitive abilities
and personal beliefs to operationalize and ensure success and survival of the sampled
stationery services.
56
Second, it was understood that while association between the profit and loss records of
the stationery and year of commencement of the stationery services was clear, but
association between profits and loss record of the stationery service and the background
education/knowledge of the stationery owner, manager or workers was not clear. This
was because 15 out of 17 respondents who had entrepreneurship education made profits
in the consecutive five years which was almost similar to 32 out of 39 respondents who
had background education/knowledge in management. This would be caused by relevant
experience whereby ones abilities increases with experience in entrepreneurship
(Armstrong, 2010), and hence, supporting the report by Luthje and Franke (2013) claimed
that no clear relationship between entrepreneurial capacity development and becoming
successful SMEs entrepreneurs.
Basing on a year of commencement of the stationery services, the respondents from
stationeries which had 1-5 years of business operations only 10 out of 31 earned profit in
the consecutive five years which was very few compared with those who had above 15
years of business operations indicated that 17 out of 19 made profit in the consecutive
five years. These results supported that experience increases ones’ abilities for superior
performance and success (Armstrong, 2010). They also supported research by Lopez and
Pastor (2015) that planned experience into entrepreneurship increased success of
managing entrepreneurship venture. They would also explain the high rate of failure of
the newly established business ventures in Tanzania (TAPBDS, 2015).
Third, it was understood that development of stationery entrepreneurship needed
combination of three categories of competencies (behavioral, managerial and technical
competencies) (Lopez and Pastor, 2015; Armstrong, 2010; Morgan & Saxby, 2007). The
managerial competencies (abilities to manage business matters of the stationery, the
abilities to manage relationships with customers of the stationery and the abilities to
manage relationships with workers of stationery) dominated competency needs among
the surveyed stationery entrepreneurs. In line with study by Mori (2014) these
57
competencies would be essential for the growth and development of stationeries in
general.
Fourth, it was understood that there were three known ways which surveyed stationery
entrepreneurs acquired competencies they needed for their SMEs: through different
opportunities for business and entrepreneurship courses provided through short courses,
consultancies or community outreach services, from dedicated schools, colleges or
universities involved in the provision of appropriate entrepreneurial/business education
and direct from community based entrepreneurship/business education which had mean
valued of 4.11, 3.9 and 3.75 respectively. This was similar with the results by
Mwasalwiba (2017) observed that most of local Universities were providing
entrepreneurial courses to their students and to local communities through organized
consultancies and outreach services.
Finally, researcher understood even though majorities of respondents were in opinion that
utilization entrepreneurial competencies acquired through capacity development did not
guarantee entrepreneurs to establish profitable SMEs and not a significant factor for
operating profitable SMEs, in support of Luthje and Franke (2013) who found no clear
relationship between entrepreneurial capacity developments and becoming successful
SMEs entrepreneurs.
But, basing on Sen’s Capability Theory, if one had related education and knowledge in
the business is likely to be successful that one who is not.. The same was supported by
the field data in which respondents agreed that entrepreneurial competency of individuals
completed business/entrepreneurship education/course should be higher than one who not
and the SMEs managed by individuals attended business/entrepreneurial education have
higher survival potentials than which are not whose mean values are 3.92 and 3.78
respectively.
58
5.2. Conclusion
The conclusion of this study is that there was association between entrepreneur aril
capacity development and becoming successfully SMEs entrepreneurs in the stationery
service contrary with claims by Luthje and Franke (2013) who concluded that there was
no clear relationship is demonstrated between entrepreneurial capacity developments and
becoming successful SMEs entrepreneurs. This was supported by the results that that 15
out of 17 surveyed samples that had entrepreneurship education opined that their
stationeries were to survive in the coming five years. Consistently, those with business
education, 28 out of 29 opined that their stationeries were to survive in the coming five
years. In the contrary, the confidence decline sharply whereby only 4 out of 11 who had
accounting and financing education were confident with survival of their stationeries, the
same figure with those who had management related courses (14 out of 25 respondents).
Also, high failure rate among the newly established business ventures in Tanzania
reported by TAPBDS (2015) would caused by lack of experience in entrepreneurship.
This was because, the respondents from stationeries which had 1-5 years of business
operations only 10 out of 31 earned profit in the consecutive five years which was very
few compared with those who had above 15 years of business operations indicated that
17 out of 19 made profit in the consecutive five years. Also, among the surveyed
respondents who had experience in stationery services between 1-5 years, only 5 out of
26 were confident with the survival of their stationeries in the coming five years. There
was extremely difference with those who had more than 15 years of work experience in
stationery services whereby all 19 respondents were confident with the survival of their
stationery services.
In order to enhance development of SMEs in stationery services in Ilala, the managerial
competencies specifically abilities to manage business matters of the stationery, the
abilities to manage relationships with customers of the stationery and the abilities to
manage relationships with workers of stationery were required. Also, technical
59
competency on the formulation of business plans, budgets and policies and regulations
and behavioral competency of seeking new ways of improving business performance
were highly needed.
These competencies required by SMEs entrepreneurs in stationery services were obtained
through different opportunities for business and entrepreneurship courses provided
through short courses, consultancies or community outreach services, from dedicated
schools, colleges or universities involved in the provision of appropriate
entrepreneurial/business education and direct from community based
entrepreneurship/business education.
However, utilization entrepreneurial competencies acquired through capacity
development would not guarantee entrepreneurs to establish profitable SMEs. Also, they
were not the significant factors for operating profitable SMEs. However, if these
competencies were related with the businesses of individuals, they would likely to be
successful in the particular businesses. This is because entrepreneurial competency of
individuals completed business/entrepreneurship education/course perceived to be higher
than whom not. Also, it was found that the SMEs managed by individuals attended
business/entrepreneurial education have higher survival potentials than those which were
not.
5.3. Recommendations
The recommendations of this study is not far from that of Madatta (2015) which stressed
that education and training should be treated as crucial aspects for growth, development
and success of SMEs in Tanzania. In order to develop stationery entrepreneurs in
Tanzanian, capacity development should involve identification of the each competency
needs and ensure that relevant actions are undertaken to satisfy the needs. Also, in the
increasing entrepreneurship concern, the stakeholders involved in the implementations of
entrepreneurial capacity development should broaden geographical coverage of short
60
courses, consultancies or community outreach services and visits and interactions among
expert and experienced entrepreneurs with inexperienced entrepreneurs and local
communities.
5.4. Implications of the study
The implications of this study is that the phenomenon of failure of the newly established
SMEs in Tanzania highlighted TAPBDS (2015) that among 100 new established SMEs;
only 5 survive to five years, the rest die within the first six month, others within two years
and the remaining within three years would be caused by lack of relevant experience in
entrepreneurship because, the respondents from stationeries which had 1-5 years of
business operations only 10 out of 31 were capable to generate profit consecutively which
was very few compared with those who had above 15 years of business operations in
which among them, 17 out of 19 were able to generate profit consecutively. Also, among
the surveyed respondents who had experience in stationery services between 1-5 years,
only 5 out of 26 were confident with the survival of their stationeries in five years ahead.
This was quite different from those who had more than 15 years of work experience
whereby all of them (19 respondents) were confident with the survival of their stationery
services five years ahead.
5.5. Recommendation for coming researches
The current study establishes the following understanding regarding entrepreneurial
capacity development for SMEs in Tanzania: First is that survival of the stationery
services had association with the level of education, related training and experience in
entrepreneurship of individual entrepreneur.
Second, while association between the profit and loss records of the stationery and year
of commencement of the stationery services may be clearly understood, but association
between profits and loss record of the stationery service and the background
education/knowledge of the stationery owner, manager or workers may not be clear. This
61
was because 15 out of 17 respondents who had entrepreneurship education made profits
consecutively which was almost similar to 32 out of 39 respondents who had background
education/knowledge in management. Researcher understood this phenomenon as being
caused by relevant experience whereby ones abilities increases with experience in
entrepreneurship.
Third, the development of stationery entrepreneurship needed combination of three
categories of competencies, namely; behavioral, managerial and technical competencies.
The managerial competencies were most needed among the surveyed stationery
entrepreneurs. In line with study by Mori (2014) these competencies would be essential
for the growth and development of stationeries in general.
Fourth, there are three common ways which entrepreneurs acquired competencies they
needed for their SMEs: through different opportunities for business and entrepreneurship
courses provided through short courses, consultancies or community outreach services,
from dedicated schools, colleges or universities involved in the provision of appropriate
entrepreneurial/business education and direct from community based
entrepreneurship/business education
Finally, the utilization entrepreneurial competencies acquired through capacity
development did not guarantee entrepreneurs to establish profitable SMEs and not a
significant factor for operating profitable SMEs and hence, there might be no clear
relationship between entrepreneurial capacity developments and becoming successful
SMEs entrepreneurs.
In a light of the highlighted foundations issues created by this research, researcher would
suggest further researches on the following areas:
62
i. Relationship between survival of the stationery services and the level of
education, related training and experience in entrepreneurship of individual
entrepreneurs
ii. Relationship between profit and loss records of the stationery and year of
commencement of the stationery services on the first hand, and with the
background education/knowledge of the stationery owner, manager or workers on
the other hand.
iii. The entrepreneurial competencies needed by entrepreneurs in the rest sectors and
subsectors to see the strengths and consistency of this research.
iv. The methods for acquisitions of entrepreneurial competencies needed among
SMEs entrepreneurs in other sectors and sub-sectors to see the consistency of the
study.
v. Relationship between utilization entrepreneurial competencies and development
of profitable SMEs.
63
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67
APPENDIXES
Questionnaires to the Respondents
Dear, my name is Swaumu Athuman Mtaullah, a student at Mzumbe University in Dar
es Salaam Campus College pursuing a Master of Business Administration specializing in
Corporate Management. I am conducting research titled ‘Understanding the
Entrepreneurial Capacity Development on SMEs in Tanzania’ as a part of the
requirements of my Master Degree Programme. Despite the evidences on increasing
entrepreneurial capacity development programs to SMEs’ entrepreneurs, among 100
established SMEs in Tanzania; only 5 survive to five years, the rest die within the first
six month, others within two years and the remaining within three years. Thus this study
wants to understand how increasing entrepreneurial capacity development accounts this
phenomenon focusing on the SMEs entrepreneurs in stationery services in Ilala
Municipality. In order to realize the study objectives, I am requesting your voluntary
support by providing information needed in the questionnaires. The information you give
will be treated with high confidentiality and used for purposes of this research. There are
no personal risks on participating in this exercise. I kindly request your valuable time to
answer these questions.
68
SECTION I
Basic information of the respondents involved
Instruction: Tick () in the appropriate box.
1. Sex: Male […] Female […]
2. Education level;
[…] Technician Certificate […] Ordinary Diploma […] Bachelor degree and above
[…]
3. Areas of specialization in the College/University Education/Training Course:
Entrepreneurship related […] Business education […] Accounts and Finance […],
Management related […] Others […] Specify: ……………………………………
4. Experience in stationery entrepreneurship: 1-5 years [...], 6-10 years […], 11-15 years
[…], above 15 years […]. Years in stationery service:
5. Title in the stationery office: Owner […], Manager […] Ownership & Manager […]
others […]. Specify:
6. Your opinion regarding survival of the stationery in the coming five years basing on
profit and loss record.
Likely to survive […]
Unlikely to survive […]
69
SECTION II
Basic information of the surveyed stationeries
Instruction: Tick () in the appropriate box.
1. Total number of workers in the stationery service:
1-5 […] 6-10 […] 11-15 […] 16-20 […] 21-25 […] 26-30 […] 31-35 […] 36-40 […] 41-
45 […] 46-50 […] 51 and above […]
2. Estimated capital invested into the stationery
Up to 5 million […] Between 5 – 200 million [….] Between 200 – 800 million […]
3. The year which the stationery commenced operations
Less than five years ago [….], About five years now […] More than five years ago […]
4. What is the position of the stationery in terms of profit in the last five years?
2013/14 Earned profit […] Incurred Loss [….]
2014/15 Earned profit […] Incurred Loss [….]
2015/16 Earned profit […] Incurred Loss [….]
2016/17 Earned profit […] Incurred Loss [….]
2017/18 Earned profit […] Incurred Loss [….]
70
SECTION III:
ENTREPRENEURIAL COMPETENCIES NEEDEDBYSMEs ENTREPRENEURS
A1: Kindly indicate whether you agree or disagree with each of the following statements
[tick () in the appropriate boxes]
No Statements
Str
on
gly
agre
e
Agre
e
Not
sure
Dis
agre
e
Str
on
gly
dis
agre
e
1 I would need abilities of setting challenging
business goals
2 I would need abilities of creating own measures of
excellence in my business
3 I would need abilities enabling to seek ways of
improving performance of my business
4 I would need abilities of working anticipatively with
fellows
5 I would need abilities to manage relationships with
workers in my stationery
6 I would need abilities to manage relationships with
customers of my stationery
7 I would need abilities to manage business matters
of the stationery
8 I would need abilities to formulate business plans,
budgets, policies and regulations
9 I would need abilities to interpret business plans,
budgets, policies and regulations
71
SECTION IV
ACQUISITION OF ENTREPRENEURIAL COMPETENCIES AMONG SMEs
ENTREPRENEURS IN ILALA MUNICIPALITY
The following statement describes ways which entrepreneurship development has
contributed towards acquisition of entrepreneurship competencies required by SMEs
entrepreneurs. Kindly indicate your opinion on the extent which you agree or disagree
with each statement by putting a tick () in the appropriate boxes
No Statements
Str
on
gly
agre
e
Agre
e
Not
sure
Dis
agre
e
Str
on
gly
dis
agre
e
1 I have acquired entrepreneurial competencies
required for my business from the dedicated
schools, colleges or universities involved in the
provision of appropriate entrepreneurial/business
education
2 I have acquired entrepreneurial competencies
required for my enterprises through planned
interactions with mentors (or role models) who have
excellent experience or knowledge in
entrepreneurship
3 I have acquire entrepreneurial competencies for my
enterprise just because recently
entrepreneurship/business education/courses target
a very large segments in the community
4 I have acquired entrepreneurship competencies for
my enterprise just because there has been broader
opportunities for business and entrepreneurship
courses whether in long courses, short courses,
consultancies or community outreach services,
72
SECTION V
UTILIZATION OF ENTREPRENEURIAL COMPETENCIES FOR DEVELOPMENT
OF SMEs IN STATIONERY SERVICES IN ILALA MUNICIPALITY
The following statement describes how entrepreneurship competency is utilized for
development of SMEs in stationery services. Kindly indicate your opinion on the extent
which you agree or disagree with each statement by putting a tick () in the appropriate
boxes.
No Statements
Str
on
gly
agre
e
Agre
e
Un
dec
ide
d
Dis
agre
e
Str
on
gly
dis
agre
e
1 I think that capacity development do not guarantee
entrepreneurs to establish profitable SMEs
2 I think that entrepreneurial competency of
individuals completed business/entrepreneurship
education/course should be higher than one who not
3 I perceive that possession of business and/or
entrepreneurship education is a significant factor for
operating profitable SMEs
4 I think that lack of business and/or entrepreneurship
education is a chief source failure of SMEs
5 I believe that SMEs managed by individuals
attended business/entrepreneurial education have
higher survival potentials than which are not.