Abstract
The Small Medium and Macro Enterprises (SMMEs) all over the world have proven to be the key to alleviating poverty, boosting economic growth and positively affecting sustainable job creation. The South African government adopted the various strategies in developing and promoting small businesses in order to accelerate SMMEs to be able to boost the socio-economic outlook of the country. Even with the more focused financial and non-financial support that SMMEs receive, the failure rate of SMMEs in South Africa is still regarded as the highest in world. SMMEs operate in both the internal and the rapidly changing external environment, which if not properly managed, can affect the sustainability of their enterprises. The study focused on exploring the dynamics between the firm’s external environment, internal environment and the firm performance. The researcher adopted a quantitative research approach and convenience sampling was used to identify the respondents who completed the structured self-administered questionnaires. The collected data was statistically analysed using the Descriptive Statistics and Exploratory Factor Analysis (EFA). Pearson’s Correlation was also adopted to determine the strength of the relationship between the External Environment (EE), Internal Environment (IE) and Firm Performance (FP). The literature findings of the study revealed that Factor Analysis on EE extracted two factors and that factor 1 (business acumen) indicated a significant strong positive relationship whilst factor 2 (macro-environment) indicated a weak positive relationship with FP. In addition, the IE results indicated a significant, strong and positive relationship with FP.
M.Phil. (Leadership in Emerging Countries)