Benchmarking Competitiveness – Research Support to the Limpopo Centre for LED

Development of a tool for benchmarking the competitiveness of enterprises, industry clusters and area strategies for industry and LED planners.

 

 

 

 

(SLC was the local implementing partner for Cardno Agrisystems Limited (UK), under Framework Contract from EuropeAid).

Client

The Limpopo Department of Local Government & Housing & European Union

Consultancy team

Andrew Charman, Leif Petersen, Fuad Cassim, Glen Steyn, James Mabela, Andrew Hartnack, Philly Manavela

Background

Competitiveness determines the prosperity of Limpopo. The competitiveness of the province is grounded in the sophistication of its enterprises, the way these enterprises utilise human, capital and natural recourses, and the state of cluster development. These factors are, in turn, shaped by the way the government manages the macroeconomic environment and its approach to supporting industry. The literature on competitiveness shows that it ultimately rests on the microeconomic foundations of the business environment. While government has a role, it does not produce wealth, industry does, and therefore its primary role is to support businesses wanting and needing to be more productive. The literature argues that governments can best achieve this objective by investing in infrastructure, instituting funding programmes, attracting new investment, supporting and enhancing the capacity of institutions to conduct R&D, funding skills training, and ensuring the delivery of basic services in primary health, education, security and the supply of utilities.

Assignment

The consultancy team designed, developed and applied a tool-kit of instruments for benchmarking competitiveness at three levels: enterprise, cluster, and area. The development of these instruments drew upon good practice and the state of knowledge on measuring competitiveness. These instruments reflect the need to ground competitiveness benchmarking in a detailed assessment of the quality of the microeconomic business environment. The quality of the business environment. This determines the level of productivity within the enterprise and allows an assessment of the role of the business cluster in enhancing competitiveness to be made. The approach adopted was strongly influenced by the benchmarking methodologies advanced by the World Economic Forum through its Global Competitiveness Index and Business Competitiveness Index.

The SLC competitiveness benchmarking tool-kit comprises six instruments, namely:

  • A road-map tool – provides an overview of the competitiveness assessment progress.
  • An enterprise competitiveness assessment tool –provides a step-by-step guide (with examples) for assessing and benchmarking the competitiveness of enterprises in specific market segments.
  • An enterprise survey (questionnaire) – provides a series of questions to guide researchers through the process of assessing enterprisecompetitiveness, using the competitiveness assessment tool.
  • An opinion survey – enables researchers to gauge the ‘opinion’ of key business persons within a value chain or cluster on the impact of macroeconomic and microeconomic drivers on competitiveness. The instrument assesses the impact, positively or negatively, of factors affecting competitiveness in nine ‘pillars’. Under each pillar, the survey contains a number of variables that the respondent is required to assess in terms of their competitiveness impact on the enterprise.
  • A tool for assessing the state of cluster development within municipalities. This instrument is designed to enable LED practitioners to evaluate the strengths, weaknesses, opportunities and threats within the beef cluster in their area, for example, and to then identify appropriate LED strategies to redress or enhance these competitiveness factors.
  • An area benchmarking competitiveness tool – enables policy-makers to assess the competitiveness of areas (province, district or municipality) against specific benchmarks. It assesses competitiveness in term of basic requirements, efficiency requirements, and investment requirements and establishes benchmarks for these drivers of competitiveness in seven ‘pillars’, following the categorization used in the opinion survey.

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