Sustainable SMEs: Time for a Closer Look at the African Context
Sustainable entrepreneurs in Africa, even those who view sustainable practices as the ‘‘right approach” for society at large, need to see these values and beliefs reinforced and sustained, researchers in the field of sustainable management say. But that support, far from being offered in a standardized way, must be tailored to entrepreneurs’ receptiveness to sustainability and local managerial practices.
“Western-style sustainability approaches don’t necessarily take into account the innate practices of firms in developing nations,” says professor Martine Spence of the Telfer School of Management. Those same firms come under intense pressure to integrate those practices, so much so that this often becomes a prerequisite to participate in global value chains. “A closer look at sustainable development in the international context is therefore needed with emphasis on the managerial practices across nations as they relate to sustainability,” explains Dr. Spence, the School's Vice-Dean (Research). She adds that this type of approach can bring to light specific entrepreneurial and organizational characteristics as well as the socio-cultural context unique to each firm, while analyzing firm commitment to sustainable development.
The differences in those characteristics can be profound. In many African countries, communal entrepreneurship prevails, and business owners feel responsible not only for their own family and their employees, but also for the employees’ families and the extended family linked by ethnicity, language and religion. To paraphrase one researcher, what someone in the West might call corporate social responsibility, a business owner in Africa might consider ordinary social etiquette. As such, the welfare provided by firms is not just culturally embedded but provides a social safety net where public institutions are weak.
No universal prescription
That is just one example of contextual factors that emerged in the cases from Cameroon and Tunisia that Spence and her colleagues analysed in their cross-country study of sustainable entrepreneurship fundamentals that also included Canada. In order to study, compare and correctly interpret the management practices of small businesses, the firms’ socio-cultural and institutional contexts had to be considered. The researchers say they were anxious to avoid using “an essentially ‘western’ lens that carried the risk of discounting certain practices widely used elsewhere and which contribute to our collective understanding.”
In spite of drastic differences in institutional and cultural factors, the three countries featured a full array of entrepreneurial attitudes with regards to sustainability. Regardless of the operating environment, some entrepreneurs were found to be visionary, fully committed to sustainability and prepared to invest in it; some were familiar with the cause but uncertain of which strategies to adopt; and some were indifferent or did not feel concerned. Committed entrepreneurs were also driven by different motives – competitiveness in Canada, opportunism in Tunisia, social considerations in Cameroon.
The study showed that using a standardised approach for the diffusion of sustainable behaviours among small business owners would run against the values of some entrepreneurs and be counter-productive within and across countries. Moreover, the research concluded, programs to support the adoption of sustainable practices and education about the issue have to be tailored to the entrepreneur’s motives, the firms’ levels of openness to sustainability, socio-cultural practices, and the countries’ priorities.
“The debate over what sustainable entrepreneurship ought to encompass in an international context has become better informed by the evidence in recent years,” Dr. Spence explains. “While that’s a welcome development, the SME owner-manager’s point of view still tends to get overlooked in the discussion.” That’s unfortunate, given that these actors are often best-placed to integrate sustainability practices in their countries. However, the study opens up exciting research possibilities going forward. Qualitative, comparative interviews should be carried out between sectors to account for differences in behaviors and the contextual factors behind them, Spence said. “Additional in-depth studies using a more ethnographic approach with each type of entrepreneur should also be conducted in each country to gain a better understanding of cultural differences.”
The research was published in the Journal of Business Ethics.
Professor Kaouthar Lajili to Lead Study of Firms’ Risk Disclosure Behaviours in Canada and Germany
Professor Kaouthar Lajili and her colleagues will examine corporate operational and business risk disclosure practices in Canada and Germany in the years leading up to and following the 2008 financial crisis. The research will shed light on the foundations of risk disclosure behaviour, and the potential links between risk exposure choice and risk management decisions. The findings will provide valuable insights into what firms actually disclose on operational and business risk and what drives that disclosure and its consequences, especially in turbulent economic times.
Professor Lajili will collaborate with Daniel Zéghal of the Telfer School and Michael Dobler of Technische Universität Dresden in Germany. As the researchers note, Canada and Germany are well-chosen for comparison, countries with advanced risk disclosure practices that have differences in their economic background, regulatory traditions and financial reporting regimes.
The findings will provide information for new or improved guidelines on how to report on risks and provide evidence for potential links with organizational performance and governance. That will be of interest to standard setters and regulatory bodies, investor and mangers. The study can also further inform and help to improve international financial reporting initiatives in terms of risk reporting and disclosure.
The project is funded by the University of Ottawa’s International Research Acceleration Program (IRAP) and the Telfer School of Management.
Barbara Orser and Catherine Elliott Win Emerald Literati Network Award
Professors Barbara Orser and Catherine Elliott of the Telfer School and Sandi Findlay-Thompson of Mount Saint Vincent University wrote a paper in 2012 that was recognized as a “Highly Commended” Award Winner at the Emerald Literati Network Awards for Excellence.
Their study, “Women-focused small business programming: client motives and perspectives” was published in the International Journal of Gender and Entrepreneurship.
Industrial-Academic Workshop on Optimization in Finance and Risk Management
Telfer professor Jonathan Y. Li is co-organizing the "Industrial-Academic Workshop on Optimization in Finance and Risk Management" the event will be held at the prestigious Fields Institute in Toronto. The event will take place on September 23 & 24, 2013.
The workshop focus is on financial and risk management optimization models that are aimed for practical implementation and use by risk managers and finance practitioners. The goal is to bridge academic research and financial applications of optimization techniques.
For more information or to register, please visit www.optimization-in-finance.ca.
Taking a Wider View of Project Management
Why do so many projects fail, despite the availability of project management (PM) tools and methods? Professor Lavagnon Ika of the Telfer School says the working assumption that all projects are similar makes it possible to impose standard PM controls and processes. But this misconception may be doing real harm when we have to deal with projects with high levels of complexity and uncertainty that inevitably do not evolve exactly according to plan, adds Dr. Ika, who has taught PM over the past 13 years at the BCom and Master’s levels in both French and English. “The rigid application of project management methods consistently gets projects into trouble.”
Ika says one of the main takeaways from his research is that “hard aspects” of PM such as time and cost are emphasized at the expense of “soft aspects” like communication, motivation, project vision, context, and organizational strategy; “the reason we are not doing well in terms of the hard aspects is because we are not doing well on the soft aspects.” The soft issues which can’t be understood quantitatively are overlooked prior to the execution phase. "This is regrettable," he points out. "In fact, a poorly initiated project has a high probability to fail! For example, at the initiation phase there may only be a brief discussion of project goals. “When there are several stakeholders involved, the goals might differ and sometimes these goals are hidden or conflicting,” Ika adds. “Assuming that all these stakeholders are on the same wavelength is a common mistake.”
Researchers like Dr. Ika hope to change that situation. Valuable lessons can be learned by studying complex projects such as international development projects. They are “typically complex in that they are cross-cultural and involve many different industrial sectors,” says Ika, who is the guest editor of a forthcoming special issue of the Journal of African Business titled “Why do projects fail in Africa?”
In a 2012 article that caught the attention of PM practitioners, he described the reasons why many development projects in Africa fail. Project leads have a tendency to take “a one-size-fits-all approach” when applying PM methodologies, he says. Moreover, they have powerful incentives to show adherence to strong procedures and guidelines, which tended to override the need to properly manage the project and to take risks for success. There is also a lack of PM skill and capacity. Finally, the cultural context is downplayed – in particular, what it takes to obtain local commitment to a given project.
Dr. Ika says that two of the above issues – adopting a “one size fits all” approach and ignoring the role of cultural issues in PM – plague other types of projects, too. “The bodies of knowledge in project management lead you to believe that all projects follow the same pattern but real life is not so linear. Project management professionals have to learn a lot about the complexity and uncertainty of the projects they take on, and at the same time they need to be aware of the environment in which they are working.
“If you can get practitioners to think about these issues that have not been much emphasized in the literature, you have accomplished part of your role as a researcher.”
- Samia Chreim Recipient of Award from the Journal of Applied Behavioral Science for her Study on Acquisition Integration
- New Research Cluster to Focus on Firms’ Risk Disclosure in a Global Context
- Research by Jonathan Patrick to Provide Model of Community Care Services
- Dan Lane to Develop Business Plan for International Market in Haiti
