{"id":275,"date":"2024-10-08T09:42:01","date_gmt":"2024-10-08T09:42:01","guid":{"rendered":"https:\/\/informalbizinnovationhub.hsrc.ac.za\/?p=275"},"modified":"2024-10-08T09:46:11","modified_gmt":"2024-10-08T09:46:11","slug":"uncovering-and-growing-business-innovation-potential-in-south-african-townships","status":"publish","type":"post","link":"https:\/\/informalbizinnovationhub.hsrc.ac.za\/?p=275","title":{"rendered":"Uncovering and growing business innovation potential in South African townships"},"content":{"rendered":"\n

Informal businesses significantly contribute to employment and income generation in South Africa. As HSRC <\/em>research<\/a> shows, innovation is crucial to their survival. On 24 and 25 April 2024, the HSRC held a workshop with informal business owners at Philippi Village, Cape Town, to share a new evidence-based <\/em>toolkit<\/a> designed to support informal businesses in strengthening their innovation capabilities. This article sheds light on how informal business owners can use the toolkit to foster innovation for business sustainability and growth. By Il-haam Petersen, Lebogang Khoza and Setsoheng Mayeki.<\/em><\/p>\n\n\n\n

Although informal businesses innovate continuously, innovation is used as part of reactive rather than proactive strategies. A research study<\/a> published in 2021 shows how informal business owners may break from necessity-driven pathways by proactively using innovation for problem solving and taking up business opportunities. Proactive innovation can be a game-changer for survivalist and microenterprises.<\/p>\n\n\n\n

At a recent workshop held in Philippi township, Cape Town, a team of HSRC researchers shared a set of guidelines and interactive learning tools designed to help informal business owners craft their own business innovation strategies. Business owners learned about innovation through a business innovation simulation and explored practical and proactive approaches to innovating in their businesses. They also connected with other informal business owners, learning with and from each other.<\/p>\n\n\n\n

The workshop was attended by a diverse group of over 30 informal business owners from the township, including spaza shop owners and food vendors, furniture makers, car wash service providers, hair salon owners, and street vendors selling a variety of goods. To facilitate uptake and engagement, the workshop was conducted in English and the main language spoken in the township, IsiXhosa.<\/p>\n\n\n\n

Using an informal business innovation toolkit <\/strong><\/p>\n\n\n\n

The workshop programme was based on a set of business innovation training modules co-created with the help of toolkit development specialist Bridget Steffen, who focuses on experiential learning techniques.<\/p>\n\n\n\n

On day 1, participants learned about innovation through a set of playful scenarios. The concept and importance of a business innovation network was shared through a practical string-connection exercise. As each person introduced themselves and their businesses, they tossed a roll of string to another person, until everyone in the workshop was connected (Figure 1).<\/p>\n\n\n\n

\"String
Figure 1. String exercise introducing the concept and importance of a business innovation network<\/em><\/strong><\/figcaption><\/figure>\n\n\n\n

The next session facilitated information and knowledge sharing among the business owners, deepening the connections. Using colour pens, each created an A3 poster describing their businesses, business goals and biggest challenges (Figure 2). This was followed by a gallery walk (Figure 3).<\/p>\n\n\n\n

\"Poster
Figure 2. Poster preparation<\/em><\/strong><\/figcaption><\/figure>\n\n\n\n
\"A
Figure 3. A gallery walk in the imaginary business marketplace<\/em><\/strong><\/figcaption><\/figure>\n\n\n\n

Based on the training modules, the HSRC\u2019s Informal Business Innovation Toolkit<\/a> encourages learning through scenario games. Based on an immersive learning approach, the games draw on real examples<\/a> gathered through HSRC research. One is a card game facilitating engagement and discussion on crises and opportunities towards better problem-solving skills. The game started with the business owners selecting a card from a deck, setting out challenges as a crisis event or business opportunity (Figure 4). Responding to the scenarios on the cards prompted the participants to develop their awareness of how they respond to challenges. For some, it was an emotional experience, as the scenario was an example of a crisis they had experienced in their business.<\/p>\n\n\n\n

\"Participant<\/figure>\n\n\n\n

Participants were guided to map their business innovation networks, a key part of a business innovation strategy, and use their networks to problem solve and take up business opportunities (Figure 5). Using the Five Whys technique, participants were guided to identify the root cause of a challenge before deciding on an action plan. They enjoyed the immersive learning approach; one business owner reported that the \u201cactivities made learning more exciting\u201d.<\/p>\n\n\n\n

\"Participant
Figure 5: Participant discussing the card they picked<\/em><\/strong><\/figcaption><\/figure>\n\n\n\n

The focus of day 2 was to guide the business owners through a process of creating a business innovation strategy. It started with a time machine exercise, encouraging participants to take a guided journey that stretched their imaginations into the past and possible futures of their businesses. Mindfulness was encouraged by inviting participants to keep their feet on the ground and take deep breaths. This was followed by a discussion and challenge-mapping exercise (Figure 6).<\/p>\n\n\n\n

\"Challenge-mapping
Figure 6. Challenge-mapping exercise<\/em><\/strong><\/figcaption><\/figure>\n\n\n\n

For most, increasing threats from extortion syndicates operating in the township were a major challenge. As one business owner explained:<\/p>\n\n\n\n

\u201cThe issue of protection fees, often demanded by gangs, has become a significant concern for local businesses. These fees \u2026 are demanded under the threat of violence or vandalism if not paid \u2026 Business owners who refuse to comply often face dire consequences, including damage to their property, personal harm, or even the closure of their business.\u201d<\/p>\n\n\n\n

Four key ingredients of business innovation<\/strong><\/p>\n\n\n\n

The foundation of a business innovation strategy is the four key business innovation ingredients identified in the toolkit: knowledge, continuous learning, an innovation mindset and business culture, and good finance and risk management. Drawing on these four ingredients, participants were introduced to a set of colour-coded typical innovation strategies they could use to guide their customised business innovation strategies. Each strategy is associated with typical business goals:<\/p>\n\n\n\n