Towards a framework for the promotion of technical and managerial entrepreneurship capabilities in Small Scale Industries in Rural Districts — a Case Study of West Gonja District in Ghana

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It is widely accepted that rural development in the Third Ir1ci. Countries (TWCs) require an integrated sectoral approach. Attempts made in rural industrialization are meant to supplement the efforts in other sectors. Although emphasis was laid on modern and large—scale industries, it has been recognized that they are net sustainable and in the rural industrialization process, mal1 Scale Industries (SIs) are inevitable. The issue is how to promote such rural SSIs in the light of numerous problems confronting them. A research was, hence, conducted as a contribution to the efforts in searching for an optimum promotional strategy for rural industrialization. A case study of existing entrepreneurs in SSIs in the West Gonja District was undertaken. This study area has a major problem of low supply of indigenous entrepreneurship. Additionally, the few existing entrepreneurs possess relatively low level of technical and managerial capabilities. Institutional and government support designated for the sector is uncoordinated and never felt in the area. Also the social and technical environment and the business climate in general are not conducive enough to attract industries. Production risks in SSIs are, hence high and these adversely affect the supply of entrepreneurship. It is being argued in this study that, an entrepreneur is central to the initiation, survival and growth of SSIs. Unlike post efforts, which used a problem—solving approach, an integrated approach, forging linkages and putting the entrepreneur first is being called for. The objective of the study was to assess the state of technical and managerial capabilities possessed, their acquisition and diffusion modalities and identification of problems confronted. A look was also made into the institutional framework to see how a pattern of support services could be made practical and accessible to rural SSI entrepreneurs. The study confirmed the existence of low supply of entrepreneurship manifested in the low level of industrial activities. Surprisingly, however, entrepreneurs were found to possess stocks of’ capabilities, which were predominantly acquired informally. They financed their operation solely from private means end there were interesting innovation in technological development especially in dye-making and farm implements, among others. Over 80 per cent of entrepreneurs work single handedly on both production and management aspects and employment generation of only 2.5 persons per enterprise was revealed. Competence in both aspects of production and management is unlikely to be embodied in one per son. No institutional support was availed to entrepreneurs; neither did they know of the existence of such support programmes. Laudable policies and programmes of the government and SSI promotional institutions have never reached the target rural entrepreneurs. Improvement in social and technical infrastructure is still lagging behind. Consequently, the entrepreneurial capabilities have remained static and measures to generate dynamic capabilities are essential. Potentials were assessed for strengthening such capabilities and stimulating new entrepreneurs, end it was found out that the District is endowed with a raw material base (agricultural and non—agricultural such as lime and salt respectively). Entrepreneurs also displayed latent talent and, institutionally, it has been recognized that entrepreneurs can be identified, trained and developed and that they come from all walks of life. The National Board for Small Scale Industries (N13551) has started an entrepreneurship Development Programme (r) in the urban areas of Kumasi and Accra, and this is being extended to Cape Coast and Tamale. There s, hence, a ground to suggest that first and foremost, the promotional strategy should centre on the entrepreneurs in order to strengthen their technical and managerial capabilities his will enable them come up with viable projects which is the pressing problem. In this way, other problems particularly finance which is felt as the urgent problem would have been minimized. Rather than capital chasing viable projects, characterising the status quo “viable projects should chase capital” The recommendations stressed the need for, as far as possible, the utilization of local resources in an integrated way. The need for technical and managerial training, technology exposure, multi—purpose industrial cooperatives, rural workshop clusters and government support services were suggested. The EDP was seen as a major tool for the stimulation of rural entrepreneurs in a single, comprehensive package. No new institution was advocated for. Rather a coordination and synchronization of existing institutions whereby the NBSSI, (at the national level and the District Development Planning Unit, at the District level) are responsible, was emphasized. Implementation of these proposals would have contributed to the reorientation of promotional strategies of rural SSI entrepreneurs.
A thesis submitted to the Board of Postgraduate Studies, Kwame Nkrumah University of Science and Technology, Kumasi, in partial fulfilment of the requirements for the award of the Degree of Master of Science in Development Planning and Management, 1990