Strategic Planning And Its Relationship With Business Performance Among Small And Medium Enterprises In South Africa

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Maxwell Sandada
David Pooe
Manilall Dhurup


SMEs, Strategic Planning, Business Performance, Gauteng, South Africa


Strategic planning is a business tool that small and medium businesses need in todays dynamic and highly competitive business environment. It has a potential to cushion these enterprises from such unpredictable harsh business conditions. The purpose of this paper was to establish the relationship between strategic planning practices and business performance among SMEs in the Gauteng province of South Africa. Data were analysed from 200 useable questionnaires that were distributed to SME owners/managers. Factor analysis, correlations, and regression techniques were used in order to extract the dimensions of strategic planning and their relationships with business performance. Environmental scanning, business mission and vision, formality of strategic plans, evaluation and control, informing sourcing, strategy implementation incentives, employee participation, and time horizons emerged as strategic planning dimensions. The results confirm that strategic planning has a positive association and predictive relationship with the performance of SMEs. The results of this study can serve as a guide to SME owners and managers to properly implement strategic planning practices which will enable them to propel and sustain their businesses in turbulent and uncertain business environments.


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