Enterprise and Supplier Development (ESD) in rural and peri-urban areas has largely been under-prioritised, writes Mpopi Khupe, Executive Director at Zevoli Growth Partners. With most corporate ESD initiatives focusing on SMMEs in close proximity to metropolitan hubs, many promising SMMEs in rural or peri-urban areas have been overlooked.
This results in lower income and fewer employment opportunities, which is the driving force behind urban migration that creates a cycle of poverty, under-developed infrastructure, and a lack of skills in outlying areas. For corporate organisations truly looking to take their ESD to a new level, they should be looking to develop SMMEs in rural, township and peri-urban areas, providing support underpinned by the spirit of making a difference before profit.
Urban vs rural: what’s the difference?
It’s understandable that corporate organisations have until now focused their attention on SMMEs within urban areas. These are easily accessible, more attractive, and often yield better results. There are fewer obstacles to engaging with SMMEs in developed areas – language is not usually a barrier nor is connectivity.
In urban areas, there is a much wider pool of small businesses to choose from, at different maturity levels. In peri-urban areas, entrepreneurs are usually at the very early stages of developing their business and take longer to mature than those in urban areas, simply because they have fewer opportunities to master their craft.
However, this makes it particularly important to strengthen and redirect efforts towards the development of SMMEs in rural and peri-urban areas. In the absence of such development opportunities, entrepreneurs are forced to migrate toward heavily populated urban areas, exacerbating overpopulation problems and creating an environment in which social ills will inevitably rise as people discover that the opportunities in the city are not as plentiful as they’d hoped.
The only way to balance the scales is to reconsider where our efforts and opportunities must go in order to ensure that those who are in rural geographies do not have this overwhelming need to migrate to an urban area in order to access opportunities.
How do we do this?
It starts with recognising that the approach must be nuanced. This is not an instance in which we can develop and package a standard ESD program that can be rolled out in every area in a uniform manner. It’s important to profile the geography and pay careful attention to profiling SMMEs and their maturity when building an ESD program, and it’s even more important to be responsive and respectful instead of being presumptuous about their capacity and capability development needs.
Taking a nuanced approach doesn’t mean developing new programs all the time, but rather being open and mindful of the fact that it cannot be a one-size-fits-all.
Additionally, focusing on ESD initiatives in non-urban areas will require a drastic shift in expectations with regard to the matrix used to define and measure critical success factors. A lot can be achieved in a 12-month or even a six-month program in an urban setting through meticulous selection of well-suited SMMEs that are set to benefit from quick win interventions.
However, in rural areas, more patience is often required. In a rural setting, other measures might be necessary, such as ensuring that concepts are explained in a manner that makes them relatable and easy to grasp, ensuring computer and digital learning platform literacy, and getting entrepreneurs comfortable with virtual ways of doing business.
Although, while on average, timeframes for non-urban ESD initiatives are likely to be longer, it is still possible to set KPIs and milestones, and report on such undertakings on an annual basis to demonstrate progress and impact.
Where to start?
Unless we start looking at ESD in rural areas differently, we’re going to keep importing ESD programmes that aren’t fit-for-purpose in those environments and yielding the same frustrating results. All the while, a focus on ESD in urban areas will perpetuate the need for migration – none of which is sustainable.
A successful approach to ESD in rural areas will require mastering segmentation, taking the time to profile the segment (both life stage and product or service offering) along with a proper understanding of the SMMEs’ unique and shared development needs. This should inform the core and other critical components of the envisaged ESD programme.
The design for the ESD programme should be informed by deliberate, localised understanding of the SMMEs’ development and should provide a gateway to access market needs in order to identify ways in which our desired outcomes can be sustainably achieved in these geographies.
Balancing the scales of opportunity
This doesn’t mean splitting focus, but rather realising that there are opportunities to achieve more than we already have. It can no longer be a case of the majority of a company’s effort going into urban ESD projects.
Instead, we must make bold decisions and shift our attention to balancing the scales of opportunity, and in the process, positively contributing towards addressing other direct and indirect socio-economic issues.