BBBEE’s Enterprise and Supplier Development (ESD) seemingly misses the mark more than it hits the intended target.

Many people HATE the idea of BEE. But corporates contributing towards SME development should not be up for debate because it’s both a moral cause and strategic to building a country’s economy.

However, there are some issues:

1. ESD initiatives don’t seem to have aligned intentions:

    • The funding made available by corporates tends to focus on the funding ROI vs impact on SME development.
    • Corporates tend to focus on maximizing (cheating) the scorecard vs creating maximum impact.

2. High-cost Business Development Support (incubators and accelerators) funded by corporates have the worst performing SMEs:

  • The hired staff are incompetent and inexperienced when it comes to growing businesses.
  • Contracted coaches, mentors and business advisors lack the wide context of developing an SME, especially in the digital age.
  • Nepotism – most corporates will hire colleagues, friends and family; not necessarily ensuring the most competent are placed in the critical role of developing deserving entrepreneurs and their businesses.

What other issues have you noticed relating to ESD inefficiencies?

KK Diaz