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Effects of Indigenisation Policy on Entrepreneurship in Zimbabwe - Essay Example

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This paper 'Effects of Indigenisation Policy on Entrepreneurship in Zimbabwe' tells us that entrepreneurs are individuals who are involved in creating a new business that contributes towards the creation of jobs, intensifying competition, and increasing productivity, thereby promoting the development of a country coupled…
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Effects of Indigenisation Policy on Entrepreneurship in Zimbabwe
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Introduction - Effects of Indignisation Policy on Entrepreneurship in Zimbabwe Table of Contents Chapter Introduction 3 1 Background of the Research 3 1.2 Objectives of the Research 5 1.3 Methods Applied 8 1.4 Conceptual Framework 9 References 15 Chapter 1: Introduction 1.1 Background of the Research Entrepreneurs are individuals who are involved in creating new business that contributes towards creation of jobs, intensifying competition and increasing productivity, thereby promoting the development of a country coupled with economic growth (Shrivastava & Shrivastava, 2013). Entrepreneurship is argued to be the ‘heart of national advantage’ (Carree & Thurik, n.d.). Entrepreneurs identify the potential opportunities within a nation who transform these opportunities for the generation of wealth. In this regard, the personal traits of the entrepreneurs are determined to have considerable impact on their ability to recognise the opportunities and perceive risk factors (Raduan & Kumar, 2006). The governments across the world are recognising the importance of entrepreneurship for the growth and success of an economy. Nevertheless, various factors are determined to influence the growth and development of entrepreneurship within a nation. These influencing factors are generally bifurcated into two groups, which include external factors and internal factors. External factors such as labour market conditions, economic climate, legislations, infrastructure access to market and government policies are ascertained to have profound impact on the growth and development of entrepreneurship in the nations. On the other hand, internal factors such as motivational factors, funding, management capability, shortage of orders, marketing capacity and poor products and services among others lay considerable impact on entrepreneurship (Cooney, 2012). As far as women entrepreneurs in an economy are concerned, additional factors such as family obligations are also ascertained to have widespread impact on their growth and development (Das, 2001). In the recent years, the recognition of the importance of the entrepreneurship in the economic growth and development by the government bodies across the world has been coupled with formulation and implementation of numerous policies (Minniti, 2008). With the view to promote the economic growth and development, the government across the world are emphasizing on articulating support policies for the entrepreneurship development. Many government bodies have been motivated to formulate broad policies to provide ideal environment as well as needed resources for the growth and development of the entrepreneurs. In the context, the government policy generally implies the course of action undertaken by the government or anticipated to be taken in the future with an objective of regulating and enhancing the conditions necessary for increasing the performance of small and medium sized enterprises (SMEs). The government bodies particularly in the developing countries have invested considerable efforts towards uplifting entrepreneurships (Obaji & Olugu, 2014; Osemeke, 2012). Moreover, developing countries such as Zimbabwe has been influenced dramatically with the declining economic performance. Zimbabwe is a sub-Saharan African country and similar to other countries in this region, the country has large population. Moreover, the sizeable portion of the country’s population resides in rural areas with agriculture as their prime occupation (Munyanyi, 2013). The country since its independence is struggling to attain economic growth and stable economic condition (Cox & Anderson, 2009). Thus, the government of the country has placed significant attention on achieving the economic growth and development through SMEs. The government of the country has recognised entrepreneurship development as a crucial measure for combating poverty and for creating employment as well as wealth necessary for achieving stable and prospering economic condition. Nevertheless, the entrepreneurships in the country face widespread problems and challenges that have strongly hindered the government objectives to promote economic growth through the development of indigenous entrepreneurship (Mudavanhu & et. al., 2014; Maseko & Manyani, 2011). In order to supplement the objective of attaining economic growth through entrepreneurship development, Zimbabwean government has undertaken several measures and policy. The government in the recent years have laid considerable stress on the policy of indignisation and economic empowerment policy (Saunders, 2008). Zimbabwean government has embarked on indignisation policy to empower the indigenous people who are recognised as economically and politically disadvantaged. The Zimbabwean government with the indignisation policy is anticipated to streamline the indigenous people towards building and developing entrepreneurship within the country for stimulating the economic growth (Wilton & Toh, 2011). Notably, the indignisation policy has both favourable and unfavourable impact on the entrepreneurship development. The unfavourable impact of the policy is strongly related with the inappropriate or misuse of the policy that would alienate certain section of the Zimbabwean population from availing the utmost benefit provided by the policy. On the other hand, numerous positive impact of indignisation policy is reckoned particularly for young entrepreneurs of Zimbabwe. In this regard, indignisation policy focussed on young entrepreneurs, anticipating contributing towards democratisation of opportunity and increased control by citizens (The African Executive, 2014). 1.2 Objectives of the Research In the contemporary world, several countries have undertaken numerous measures and policy to attain economic growth through the development of the entrepreneurship. Both developed and developing countries have identified the importance of economic policy and its relationships with entrepreneurships as a prominent factor to drive economic prosperity and growth. These policies undertaken by the different governments of the world have considerable impact on the entrepreneurs in the nation. Not only the developed countries, but at the same time, the emerging economies of the world such as Zimbabwe can be seen to incorporate various policies for stimulating the rate of economic growth. In this regard, many scholars and economic experts have claimed that the indignisation policy and empowerment policy undertaken by Zimbabwean is likely to have considerable impact on the Zimbabwean indigenous entrepreneurship. Correspondingly, the research aims at exploring both positive and negative impact of indigenisation policy on entrepreneurship in Zimbabwe. In order to substantiate the research aims, certain research objectives have been framed which include. To establish relationships between the relevant entrepreneurship theories in the context of Zimbabwean indigenous entrepreneurship To design a conceptual framework to explore the nature and impact of the indignisation policy on the Zimbabwean indigenous entrepreneurship To examine and analyse the major institutional factors that promotes opportunity driven entrepreneurship among the indigenous Zimbabwean To provides crucial insights and knowledge of how entrepreneurial outcomes are determined in a Zimbabwean context To evaluate the indignisation policy and empowerment initiatives embarked by the Zimbabwean government to promote economic growth To determine the implications of indignisation policy and empowerment initiatives on Zimbabwean indigenous entrepreneurship To develop a basic understanding that will provide a foundation for further investigation of entrepreneurship development in Zimbabwe and other similar economies 1.3 Methods Applied Selection of appropriate method in any research is extremely important. In this regard, failure to select and apply appropriate method may have the tendency to limit the scope of research. Thus, significant attention was placed in the selection of method for this study. The purpose of the research was to explore and obtain complete understanding of the impact of the indignisation policy on the Zimbabwean indigenous entrepreneurship. Thus, in-depth, qualitative case studies were undertaken in the study (Elo & Kynga’s, 2007). Multiple case studies were also undertaken in the study. The case studies were selected using purposeful sampling. Since the research was directed towards exploring the impact of indignisation policy on Zimbabwean indigenous entrepreneurship, an exploratory, phenomenological position was applied to acquire ‘live experiences’ of the phenomenon pertaining to indignisation policy. In addition, the study is based on an interpretive research paradigm as it is considered as the most dominating research philosophy used in the qualitative research. At the same time, research based on this paradigm primarily focuses on the details of situation as well as it facilitates in investigating the reality behind these details in a more comprehensive manner (Walsham, 2006; Rowlands, 2005; Groenewald, 2004). The research method for study was based on both secondary research searches and primary data. The validity of the research study largely relies on the reliability of the data collected. Therefore, the reliability of data complied was duly ensured. An extensive review of literature was undertaken in order to answer the research questions (Long-Sutehall & et. al., 2010). For this purpose, secondary data was compiled from reputed and lately published journals, articles and professional publications along with economic report dealing with entrepreneurship in Zimbabwe. Priority will be placed on the lately published peer reviewed journals like ‘Entrepreneurship Theory and Practice’. An in-depth unstructured interview was used to collect primary data. Interviews were transcribed and evaluated thematically. Interviews were undertaken with the Zimbabwean entrepreneurs (Corbin & Morse, 2003). Findings from interviews were compared with theoretical ideas. The data obtained from the secondary sources was analysed with the application of grounded theory. The grounded theory was chosen as the qualitative analysis tool, due to the fact that it is considered to be an ideal for research study dealing with human factors. The theory is considered suitable for investigating complex multifaceted phenomenon. Besides, it is relatively easier to interpret data using the grounded theory (Jones & Alony, 2011). Additionally, the study placed significant importance on the ethical considerations. Correspondingly, the study ensured that the data obtained from the secondary sources are accurate and are reliable. The study ensured that the data are managed and interpreted in the most effective manner to ascertain its validity (Nicholson & Bennett, 2008). In addition, the data were stored in the electronic form to prevent any misuse and for future references (Orb & et. al., 2000). Nevertheless, data collection using this approach limited the availability of relevant data for the research, thereby raising questions about generalizability. Thus, in this context, more extensive research is needed in order to achieve more vigorous generalisations. 1.4 Conceptual Framework The study was conducted to analyse and understand the impact of the indignisation policy embarked by the Zimbabwean government on the indigenous entrepreneurship. In the current complex and dynamic economic condition, entrepreneurship is claimed to act as a catalyst for economic growth (Kayode, 2012). However, entrepreneurship development has been subject to influence by numerous factors particularly in developing countries than in developed economies. Correspondingly, the study majorly concentrates on developing country perspective, as it is often perceived that emerging countries with low or middle income face challenges of reduced institutional quality when compared with developed economies of the world. Nevertheless, the challenges of poor institutional framework tends to influence both developed and developing economies but it is often claimed that the severity of this challenge is greater in developing countries like Zimbabwe. Moreover, institutional and resources tends to have varying effect in different contexts. Thus, there is a greater requirement to design a refined way to evaluate how contextual elements vary in developing economies and to what scale they influence entrepreneurial goals, performances, and efficacy of actions (Bruton & et. al., 2008; Urban, n.d.). It is quite surprising, that earlier researches have rarely analysed the effect of institutions in determining entrepreneurial actions in emerging economies. Thus, the research on developing economies would facilitate more use of historical context to deliver reference points to scholars and researchers. The study is anticipated to provide comprehensive understanding regarding the pros and cons of indignisation policy. The study is expected to facilitate the scholars, entrepreneurs, economist and policy makers with an in-depth insight regarding the features of indignisation and the impact of indignisation policy on the indigenous entrepreneurship of Zimbabwe and other emerging economies. In addition, the study is also anticipated to contribute towards enhancing the understanding of academic students about the implications of indignisation policy. In order to meet the aims and objectives of the study a set of research questions were framed that would be addressed in the study. The research questions included. What is the status of entrepreneurship in Zimbabwe? How indignisation policy has influenced the entrepreneurship in Zimbabwe? It was anticipated that answer to these research questions would facilitate in providing significant insights and understanding regarding the prevailing entrepreneurial trend in Zimbabwe and the potential impact of indigenisation policy on entrepreneurship in Zimbabwe. The first goal of the study therefore was to create a framework synthesising existing models or concepts that would enable consistent description of entrepreneurial trend in Zimbabwe. Notably, in order to asses the effect indigenisation policy on Zimbabwean indigenous entrepreneurship, the study first proposes a conceptual framework of the institutional environment. Often, the phrase ‘conceptual framework’ is used with different meaning and it can be confusing at time. Thus, it becomes essential to define the sense in which the phrase is applied. In this study the phrase, ‘conceptual framework’ has been applied in its general meaning. In this context, the conceptual framework is defined as “a simplified representation of selected aspects of a phenomenon aiming to conceptualise it and allow explanations of relationships to be framed and tested” (Checkland, 2007). Prior to the development of the conceptual framework, an extensive review of relevant literature was performed in order to draw the understanding regarding the various concepts. The exploration of the existing literature acquainted with the numerous concepts that were discovered in the due course. In order to acquire a clear sense of the ideas generated from the review of literature, the concepts that were discovered were organised in a hierarchy of categories with the aim to develop a tool for conducting an informed study. Hence, the conceptual framework was formed by: Taking into account the various concepts discovered during the literature review regarding the entrepreneurship and factors influencing entrepreneurship development in emerging economies Aligning these concepts to create coherent and distinct categories and by omitting any possible redundancy Creating a self-consistent classification, espousing existing terms and concepts where the prevailing ones were ambiguous It is vital to mention that the conceptual framework presented in this study represents a core conceptualisation of the problematic situation rather than a mere description of it. The elements included in the conceptual framework are not presumed to be literally present in the Zimbabwean context, but are useful in contemplating about the situation. Moreover, the conceptual framework developed in this study was intended to provide a structured approach for research that may be vital in acquiring understanding regarding the impact of indignisation policy on entrepreneurships in Zimbabwe and in other similar emerging economies in general. The conceptual framework is used to establish linkage between the various elements of indignisation policy with entrepreneurships. The conceptual framework considers the central activity-taking place in the Zimbabwean economy, especially the indignisation policy and its impact on Zimbabwean indigenous entrepreneurship. Frameworks are helpful in exploring new concepts as well as they enable new information to structure easily and in a sensible manner (Leshem & Trafford, 2007). In this regard, one of the major aims of the study was to provide economic policy makers with an in-depth understanding regarding the entrepreneurship as a potential source to achieve economic growth as well as to support this theoretical perspective. Theories determined early on in the study that related to the growth and development of entrepreneurship as well as factors driving entrepreneurship in an economy was examined in a more detailed manner. The conceptual framework was linked with the research questions and the objectives to ensure proper structuring of the study. To be precise, the framework was developed to refine the research objectives and questions, which further facilitated in eliminating any further threats regarding the drawing of valid and reliable conclusion. It also facilitated to visualise the research problem in a coherent manner and enabled to devise efficient strategy for the research rather than merely focusing on the theories and scholarly works relevant to the study. According to Smyth (2004), the functions of a conceptual framework can be related as a “a tool to scaffold research and, therefore, to assist a researcher to make meaning of subsequent findings” and also that the framework “forms part of the agenda for negotiation to be scrutinised and tested, reviewed and reformed as a result of investigation” (Smyth, 2004). Thus, it is stated that the framework need to be considered only as a snapshot of a structuring work, and as a technique of communicating the elements of an analysis. On the contrary, it has been argued that the framework should not be viewed as an attempt to perfectly portray the entire elements relevant to the specific field or the concerned subject area. Nevertheless, there may be certain loopholes in a framework but attempting to arrange these components into a single model is a vital phase in determining those loopholes. Precisely, the framework facilitated in further research through: Delivering a foundation to interpret and form a coherent literature Developing evaluation activities Merging various factors involved in the entrepreneurship development Facilitating the articulation of the research findings Arranging the inclusion of any new or emergent categories Delivering a shared ground based on previous literature to reflect upon for eliminating challenges related to the structure of the research The conceptual framework considered in this study comprises four categories, which are: Indiginisation policy Entrepreneurial trends in Zimbabwe Impact of indignisation policy on entrepreneurs in Zimbabwe Practical illustrations Indiginisation policy included in the conceptual framework reveals the meaning of indiginisation and the general impact of indiginisation policy on entrepreneurships. It facilitated in acquiring the general ideas about the indiginisation policy such as the features and characteristics related to it. Again, entrepreneurial trends in Zimbabwe included in the conceptual framework facilitated in acquainting rich understanding regarding the prevailing entrepreneurial trends in the country and the factors currently influencing the development of entrepreneurships in the nation. The various concepts and factors were derived to influence the entrepreneurship development in the country, which included infrastructure, government, financial market, management or skills, labour markets, technology and R&D, training among others. The exploration of these factors yielded a coherent picture of entrepreneurial trends in Zimbabwe. In the similar context, structuring impact of indignisation policy on entrepreneurs in Zimbabwe in the conceptual framework enabled to draw the pros and cons of indignisation policy on the entrepreneurs in Zimbabwe. Besides, it facilitated to acquire brief idea about employee participation in the corporate sector in Zimbabwe as well as explore the aspect related to the indigenous ownership of national resources. Alongside, the challenges and opportunities to women and young entrepreneurs in Zimbabwe and aspects surrounding the financial requirements were discovered with the application of conceptual framework. Notwithstanding, the practical illustrations included in the conceptual framework facilitated acquiring real facts and figures derived from the historical context validating the impact of indignisation policy on the entrepreneurs in Zimbabwe. References Bruton, G. D. & et. al., 2008. Entrepreneurship in Emerging Economies: Where Are We Today and Where Should the Research Go in the Future. Entrepreneurship Theory and Practice, pp. 1-14. Checkland, K., 2007. Understanding General Practice: A Conceptual Framework Developed From Case Studies in the UK NHS. Br J Gen Pract., Vol. 57, No. 534, pp. 56–63. Corbin, J. & Morse, J. M., 2003. The Unstructured Interactive Interview: Issues of Reciprocity and Risks When Dealing With Sensitive Topics. Qualitative Inquiry, Vol. 9 No. 3, pp. 335-354. Cooney, T. M., 2012. Entrepreneurship Skills for Growth-Orientated Businesses. Dublin Institute of Technology, pp. 1-23. Carree, M. A. & Thurik, A. R., 2002. The Impact of Entrepreneurship on Economic Growth. Centre for Advanced Small Business Economics, pp. 1-28. Cox, L. & Anderson, D. A., 2009. Dealing with the Crisis in Zimbabwe: The Role of Economics, Diplomacy, and Regionalism. Small Wars Journal, pp. 1-22. Das, M., 2001. Women Entrepreneurs from India: Problems, Motivations and Success Factors. Journal of Small Business & Entrepreneurship, Vol. 15, No. 4, pp. 67-81. Elo, S. & Kyngas, H., 2007. The Qualitative Content Analysis Process. Journal of Advanced Nursing, Vol. 6, No. 1, pp. 107-115. Groenewald, T., 2004. A Phenomenological Research Design Illustrated. International Journal of Qualitative Methods, Vol. 3, No. 1, pp. 1-26. Jones, M. & Alony, I., 2011. Guiding the Use of Grounded Theory in Doctoral Studies – An Example from the Australian Film Industry. International Journal of Doctoral Studies, Vol. 6, pp. 69-114. Kayode, O., 2012. Impact of Globalization on Human Resource Management. Science Journal of Business Management, Iss. 3, pp. 1-4. Leshem, S. & Trafford, V., 2007. Overlooking the Conceptual Framework. Innovations in Education and Teaching International, Vol. 44, No. 1, pp. 93–105. Long-Sutehall, T. & et. al., 2010. Secondary Analysis of Qualitative Data: A Valuable Method for Exploring Sensitive Issues with an Elusive Population? Journal of Research in Nursing, Vol. 16, No. 4, pp. 335–344. Minniti, M., 2008. The Role of Government Policy on Entrepreneurial Activity: Productive, Unproductive, or Destructive? Entrepreneurship Theory and practice, 779-790. Mudavanhu, V. & et. al., 2014. The Impact of Entrepreneurship Training Programme on Economic Development in Zimbabwe: A Case of Gweru. International Journal of Social Sciences and Entrepreneurship Vol.1, Iss.9, pp. 1-11. Munyanyi, W., 2013. Bottle-Necks to Successful Rural Youth Entrepreneurship in Zimbabwe. International Journal of Education and Research, Vol. 1, No. 11, pp. 1-10. Maseko, N. & Manyani, O., 2011. Accounting Practices of SMEs in Zimbabwe: An Investigative Study of Record Keeping for Performance Measurement (A Case Study of Bindura). Journal of Accounting and Taxation, Vol. 3. No.8, pp. 171-181. Nicholson, S. W. & Bennett, T. B., 2008. Transparent Practices: Primary and Secondary Data in Business Ethics Dissertations. Journal of Business Ethics, pp. 1-9. Obaji, N. O. & Olugu, M. U., 2014. The Role of Government Policy in Entrepreneurship Development. Science Journal of Business and Management, Vol. 2, No. 4, pp. 109-115. Osemeke, M., 2012. Entrepreneurial Development and Interventionist Agencies in Nigeria. International Journal of Business and Social Science, Vol. 3, No. 8, pp. 255-265. Orb, A., Eisenhauer, L., & Wynaden, D. (2000). Ethics in Qualitative Research. Journal of Nursing Scholarship, Vol. 33, No. 1, pp. 93-96. Raduan, C. R. & Kumar, N., 2006. The Dynamics Of Entrepreneurs’ Success Factors In Influencing Venture Growth. Journal of Asia Entrepreneurship and Sustainability, Vol. II, Iss. 2, pp. 1-23. Rowlands, B. H., 2005. Grounded in Practice: Using Interpretive Research to Build Theory. The Electronic Journal of Business Research Methodology Vol.3, Iss. 1, pp 81-92. Shrivastava, S. & Shrivastava, R., 2013. Role of Entrepreneurship in Economic Development. International Journal of Management and Social Sciences Research (IJMSSR), Vol. 2, No. 2, pp. 1-5. Smyth, R., 2004. Exploring The Usefulness Of A Conceptual Framework As A Research Tool: A Researchers Reflections. Issues in Educational Research, Vol. 14 No. 2, pp. 167- 180. Saunders, R., 2008. Crisis, Capital, Compromise: Mining and Empowerment in Zimbabwe. African Sociological Review, Vol. 12, No. 1, pp.67-89. The African Executive, 2014. Zimbabwe: Indigenisation Can Unleash Young Entrepreneurs. Perspectives. [Online] Available at: http://www.africanexecutive.com/modules/magazine/article_print.php?article=6049 [Accessed December 03, 2014]. Urban, B., No Date. Social Entrepreneurship in an Emerging Economy: A Focus on the Institutional Environment and Social Entrepreneurial Self-Efficacy. Managing Global Transitions, Vol. 11, No. 1, pp. 3–25. Walsham, G., 2006. Doing Interpretive Research. European Journal of Information Systems, Vol. 15, pp. 320–330. Wilton, W. & Toh, W., 2011. Entrepreneurship through indigenisation; the sweet and the bitter: the Zimbabwean example. World Review of Entrepreneurship, Management and Sust. Development, Vol. 7, No. 3, pp. 272-280. Read More
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