Case of the Leather Sector in Ethiopia

Abstract

Entrepreneurship has played an important role in economic growth, innovation,
competitiveness and in poverty alleviation. Today’s dynamic, global, and
challenging business environment requires a firm to be entrepreneurial if it is to
survive and grow. Rapidly changing technology and shortened product life cycles
support the need for a firm to be innovative and develop new ideas, products, and
processes, and be willing to take risks to cope with rapid change. Increased
domestic and global competition amplifies the need for a firm to stay ahead of
competition. In dynamic business environment, Small and Medium Enterprises
(SME’s) must make competitive changes in order to move forward. The capacity to
seize on an opportunity depends on the level of entrepreneurial orientation that a
firm possesses (Waldron, 2004). This is because direct entrepreneurial orientation
is associated with innovation, proactive and the willingness to take risk which is an
important measurement to a firm when implementing a certain strategy to compete
with opponents. This study investigated the degree of Entrepreneurial Orientation
(EO) of thirty footwear manufacturing Small and Medium scale Enterprises (SMEs)
in Addis Ababa. This study deals with the five dimensions that are critical to
entrepreneurial orientation: innovation, pro-activeness, risk taking, competitive
aggressiveness, and autonomy in relation to small & medium leather footwear
manufacturing enterprises in Addis Ababa. And finally come up with the
information that to what extent the investigated enterprises are aware of EO and
practice it. Qualitative and quantitative techniques were applied for data analysis.
Findings showed about 80% of SMEs in AA represented moderate and above
moderate level of EO. From the five dimensions: Proactiveness, innovativeness, risk
taking competitive aggressiveness, and autonomy, the autonomy and proactiveness
dimensions are the most and least exercised ones by the respondents taken in this
study. Results further indicated there were moderate responses to the rest
dimensions. This study could be useful for policy makers to plan their activities
towards entrepreneurship development of SMEs in AA. It is hoped that the findings
of this study discussed here can benefit the government, entrepreneurs, other
researchers, and important parties in the field of entrepreneurship.