Achieving best practice through knowledge management : benchmarking and competitive intelligence as techniques for strategic decision-making in small and medium sized enterprises

SMMEs provide opportunities for employment and economic growth for South Africa.SMMEs need to be as prepared as their larger counterparts in the ever-changing local andglobal business environment. In order to become not only successful but also sustainable, thesmaller enterprise must be aware of what is happening in both its external and internalbusiness and operating environment. It is important for these smaller enterprises to takecognisance of changes in the political and legislative environments, as well as changes incustomer expectations and competitor behaviour. Knowledge management tools such ascompetitive intelligence and particularly internal and external benchmarking are vital for thecompany’s survival.Concepts such as benchmarking for internal and external best practices, as well as competitiveintelligence to gain important external decision-making knowledge, can be as beneficial toSMMEs as they are to the large corporate entities. However, knowledge management islargely ignored in the smaller company’s decision-making processes, due to financial andtime constraints as well as a lack of the necessary skills to utilise knowledge managementtools. Knowledge management can therefore be as important and beneficial to the smallerenterprise’s operations and decision-making mechanisms as it may be to corporations andlarge companies.The broad goal of this study is to review the literature on achieving best practice byimplementing knowledge management in organisations. The examination of the literature andthe subsequent description of the outcomes could be used to create awareness that, like largercompanies, SMMEs need to process internal as well as external information in order to makestrategic decisions. The utilisation of CI tools such as SWOT analysis, PEST analysis andbenchmarking allow the company to systematically gather and interpret information. By usingthe Baldrige criteria, a systematic and continuous approach for learning and improvement isdeveloped.This methodology (the literature review) provides a framework for gaining the knowledgethat already exists (in books, journals and on the Internet). By disseminating this knowledgeaccording to the methods described, it is hoped that the research will construct alreadyexisting knowledge into a new approach that might benefit the discipline as a whole. From the results of the study, it should become clear that certain aspects of enhancing CI insmaller enterprises require attention. Although there are organisations that assist SMMEswith relevant information, this information is scattered across various sources in differentformats. Not much information and assistance is available to smaller enterprises that providesa clear framework of how to achieve internal CI practices by using the CI tools and businessmodels such as benchmarking within the formal structure of the Baldrige criteria.