A recent study by the Human Sciences Research Council (HSRC) has found that innovative
South African businesses have greater access to global markets and a more skilled
workforce compared to non-innovative enterprises. The South African Business Innovation
Survey (BIS) revealed that “62% of South African businesses took scientific, technological,
organisational, financial, or commercial steps aimed at realising an innovation” between
2019 and 2021.

According to the survey results, “Training emerged as the most common innovation activity
for 47% of innovation-active businesses, followed by software and database activities (29%),
and marketing initiatives (25%).” However, inclusivity remains an issue, with only “38 in 100
workers being female and 62 in 100 were African” involved in these innovation activities.

Dr Amy Kahn, who led the BIS study, stated, “There remains significant scope for
businesses in South Africa to undertake innovation activities that result in novel innovations,
and do so in an inclusive manner. In South Africa, where we face multiple challenges, a
more innovative business sector can contribute to productivity and business resilience as
well as job creation, improved working conditions and quality of life.”

The survey examined approximately 5,500 enterprises across various industries and sizes.
Among innovation-active enterprises, 37% introduced both product and process innovations,
while 23% had only product innovations and another 23% only process innovations. Notably,
the Internet of Things (IoT) technologies were most widely used or developed by 80% of all
innovative businesses.

Dr Moses Sithole, Research Director at the HSRC’s Centre for Science, Technology and
Innovation Indicators (CeSTII), emphasized the importance of understanding why firms do or
do not innovate, stating, “The innovation situation for all South African businesses should
concern us, including why firms do or do not innovate.”

The survey identified high costs (27%), competition (25%), and lack of funds (24%) as
significant barriers to innovation for businesses. However, Dr. Glenda Kruss, Executive Head
of CeSTII, highlighted the survey’s contribution to understanding South African business
innovation practices, saying, “The analysis conducted in this round of the Business
Innovation Survey takes us significantly closer to understanding the South African business
innovation practices that shift the needle. This informs how we should design support for
greater business innovation in our country.”