Categories: EconomyNews

South African Businesses Embrace Innovation for Global Competitiveness

  • South African businesses exhibit a growing inclination towards innovation, with a significant proportion engaging in various innovation activities such as training, software development, and marketing initiatives.
  • Despite progress, disparities exist in participation, with women and African workers underrepresented in innovation activities, highlighting the need for more inclusive approaches to innovation adoption.
  • The survey underscores the transformative potential of innovation in addressing socioeconomic challenges, emphasizing the importance of targeted support mechanisms to overcome barriers and foster a culture of innovation conducive to sustainable economic growth.
Published by
Miriam Matoma

Innovation has emerged as a pivotal force in propelling South African businesses forward, providing them with a competitive edge in the global market. Recent findings from the South African Business Innovation Survey (BIS) conducted by the Human Sciences Research Council (HSRC) shed light on the significant strides made by innovation-active enterprises in South Africa between 2019 and 2021.

During this period, the BIS revealed that a substantial portion, 62%, of South African businesses undertook various innovation activities, encompassing scientific, technological, organisational, financial, or commercial endeavors. This proactive approach towards innovation underscores the commitment of businesses in South Africa to stay relevant and competitive in a rapidly evolving landscape.

Key findings from the survey indicate that training emerged as the most prevalent form of innovation activity, with 47% of innovation-active businesses prioritizing skill development. This was closely followed by software and database activities (29%) and marketing initiatives (25%), reflecting a multifaceted approach to innovation adoption.

However, the survey also highlighted disparities in participation, with only 38 in 100 workers involved in innovation activities being female, and 62 in 100 being African. Addressing these gaps in participation is crucial for fostering a more inclusive and diverse innovation ecosystem in South Africa.

The prominence of the computer sector in embracing innovation activities underscores the pivotal role of technology in driving business growth and competitiveness. Yet, there remains ample room for further innovation, particularly in sectors facing unique challenges endemic to the South African context.

Dr. Amy Kahn, leading the BIS, emphasized the transformative potential of innovation in addressing the myriad challenges faced by South African businesses. A more innovative business sector not only enhances productivity and resilience but also facilitates job creation and improves overall quality of life.

The widespread adoption of advanced technologies such as the Internet of Things (IoT) among innovative businesses signals a shift towards embracing digital transformation to enhance efficiency and connectivity.

The survey report, commissioned by the Department of Science and Innovation and conducted by HSRC’s Centre for Science, Technology, and Innovation Indicators (CeSTII), offers valuable insights for policymakers, industry leaders, and associations to foster a conducive environment for business innovation.

Dr. Moses Sithole, Research Director at CeSTII, highlighted key barriers to innovation, including high costs, intense competition, and a lack of funds. Overcoming these obstacles requires targeted interventions and support mechanisms to stimulate innovation across all sectors of the economy.

Notably, the BIS report underscores the importance of quality-driven innovation, focusing on improvements in working conditions, product quality, and overall well-being, rather than purely cost-related outcomes.

Dr. Glenda Kruss, Executive Head of CeSTII, emphasized the need for a nuanced understanding of innovation practices to inform tailored strategies for fostering innovation in South Africa. Businesses without formal innovation processes are more likely to abandon their projects, underscoring the importance of structured approaches to innovation management.

Moreover, businesses with the capacity to develop innovations in-house and those with more novel product innovations demonstrated higher turnover rates, highlighting the tangible benefits of investing in innovation capabilities.

Furthermore, businesses with stronger global market connections and higher product innovation novelty were found to hold greater intellectual property rights, underscoring the strategic advantage of innovation in securing competitive positions in the global arena.

In conclusion, the South African Business Innovation Survey provides invaluable insights into the innovation landscape, highlighting both progress made and areas for improvement. By leveraging these findings to inform policy and strategy, South Africa can foster a culture of innovation that drives sustainable economic growth, fosters inclusivity, and addresses pressing societal challenges.


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Miriam Matoma

Miriam is a freelance writer, she covers economics and government news for Rateweb. You can contact her on: Email: Twitter: @MatomaMiriam