An investigation into the government s attempts to support
World Bank research results presentation
1. The impact of low cost business education:
Evidence from a Randomized Controlled Trial in Cape Town
2. Programme
1. Introduction to Business Bridge:
Director Dr Mike Herrington
2. Background to the research project
3. Introduction to JPAL:
Laura Poswell: Executive Director
4. Results to date
5. Meet the Graduates
6. Call to action
3. The Business Bridge Mission
To tackle poverty and unemployment by
providing high quality, relevant,
applicable business education at low
cost on a mass scale
5. • Institutions (e.g. property rights)
• Information (e.g. registration)
• Human Capital (e.g. health)
• Financial Capital (e.g. credit)
• Managerial Capital (e.g. financial skills)
Micro-level solutions
for Small Firms:
- Finance focused
- Evidence mixed
(see Acemoglu et al 2005; Beck et al 2006; Bloom et al 2010; Bruhn et al 2010; Duflo et al 2012; Hsieh & Olken 2014;
Jensen 1998; Karlan & Appel 2012; Nichter et al 1999; Tybout 2000; Sachs 2006)
Marketing Skills?
Factors affecting growth
6. Policy Makers…
Researchers…
Experts…
Muhammad Yunus,
Nobel Laureate:
“[The poor] do not need us to teach
them how to survive; they already
know. So rather than waste our time
teaching them new skills, we try to
make maximum use of their existing
skills. Giving the poor access to
credit allows them to immediately
put into practice the skills they
already know.” (1999)
The doubters…
7. Addressing the Need
Major lack of
Managerial Capital –
the management of
factors of production
1. High quality course
materials
2. Face-to-face tutoring by
business professionals
3. A network of partner
organisations that provide
wider enterprise
development support
services
The Need Our three-part model
9. A Representative Sample
Beauty Shops
12%
Restaurants
11%
Family Clothing
(reseller)
5%
Building/Construction
5%
Grocery stores
4%
Electrical repair
4% Child care
3%Cleaning,
landscaping
3%
Misc. apparel
2%
Misc. trade
2%
Misc. apparel
(reseller)
2%
Misc. metal products
2%
Barber shops
2%
Outerwear (uniforms)
2%
Computer/data
processing
2%
OTHER
39%
15 industries account for 60% of the sample
10. Core offering: Training
Course Offerings Finance; Sales & Marketing
Time Frame Four hours once a week for eight weeks (per course)
Medium of
Instruction
Face-to-face tutoring by highly experienced business professionals
on a pro-bono basis
Location
Local venue provided free of charge or at minimal cost by
strategic partner
Cost to
Participant
R150 per entrepreneur per course as a ‘commitment fee’
11. Learning That’s Relevant
• Module 2: Identify
customer needs
• Module 4: Questioning
skillfully
• Module 7: Delivering
on product/service
promises
• Module 1: Financial
jargon
• Module 5: Analysing
business and financial
decisions
• Module 8: Funding
your growth
Making Sales Managing Money
13. What is J-PAL?
• The Abdul Latif Jameel Poverty Action Lab (J-PAL) was established in 2003
as a research centre at the Economics Department at the Massachusetts
Institute of Technology (MIT).
• J-PAL is a global network of researchers who use randomized evaluations
to answer critical policy questions in the fight against poverty.
• 108 affiliated professors, 573 ongoing or completed evaluations in 56
countries.
• J-PAL’s mission is to reduce poverty by ensuring that policy is informed by
scientific evidence. We do this through three main activities:
16. J-PAL and Business Bridge
• J-PAL identified the Business Bridge programme as a key intervention
which could potentially reduce unemployment and poverty in South
Africa.
• J-PAL and Business Bridge worked closely together to design the most
rigorous impact evaluation of the training program.
• Once the training started, J-PAL conducted independent high quality data
collection with the business owners in the study sample.
• J-PAL organised and supervised three rounds of data collection: baseline,
midline and endline.
• The first preliminary results compiled by the researchers look promising
and we are now eager to turn those results into recommendations for
policy makers.
17. “Business Skills” Training for small firms
Prior Studies
(see McKenzie & Woodruff 2012)
Our Study
Sample: heterogeneous homogeneous
Intervention: weaker stronger
Functional focus: general specific
Measurement: paper electronic
Innovations in our research
18. The Research in Numbers
Sample size 832 Entrepreneurs
Registration 5 training locations: urban, suburban and township areas
Data Collection
20+ researchers collected data at the business locations using a new
electronic tool
The “typical”
Business Bridge
Entrepreneur
1.50 employees
R13,750 monthly sales
R3,840 monthly profits
38% registered
5 years operating
53 hours/week
6% accessed loans
39 years
46% female
62% graduated secondary school
98% black/colored
24. Marketing growth focus
utilization: changing sales staff incentives
allocation: planning product line adjustments
Finance efficiency focus
utilization: tracking the cost of goods
allocation: separating personal and business
expenditures
Skills Do Improve Performance
25. Meet the graduates
Melton Oppelt : Owner, MP Transport CC
Thumi Kgaphole : Owner, Bob Masters Salon and Academy
26. Our Goals
Deliver 1500 course places to over 1000 entrepreneurs by May 2015
Replicate the model in new locations by Q3 2015
Our Partners
Bringing Research to Reality
27. Business Support Network
What? Fortnightly networking sessions
Where? Every community in which we deliver training
Who?
Business Bridge graduates and community based
entrepreneurs
Why?
1. Continued interaction with graduates
2. Increase the flow of business and strengthen
communities
3. Access point for partners and ED opportunities
4. Further data collection
How?
28. Building Bridges to Opportunity
Entrepreneurs
Communities
New markets, ideas
and knowledge
ED Partners
Corporate Partner
30. The next ‘Train the Trainer’
What? Facilitator training session
Where? TBD
When? Friday 10th October, 1-5pm
Who?
Local business professionals with sales, finance or
entrepreneurial experience
Why?
1. Share your business skills
2. Develop your facilitation skills
3. Gain knowledge of the micro-economy
4. Have fun!
How? tparry@thebusinessbridge.org
