Internet cafés in South Africa render a wide spectrum of services and digital competencies to users such as the downloading and uploading of documents, browsing websites, emailing and document processing. For example, Internet café employees normally provide valuable services and support in computer use and information access to inexperienced users (Furuholt & Kristiansen, 2007). Despite these claims, there is no guarantee that such service providers possess sophisticated technological skills and digital competencies, founded on their possession of a compendium of managerial competencies. Chen, Paik and McCabe’s (2014) investigation of the Internet users’ practices and perceptions of Internet security in Ghana revealed their limited comprehension of the operation of Internet technologies. They elaborate on such users’ exclusive dependence on passwords for online information security and their reliance on ad hoc practices such as word of mouth to augment their knowledge of Internet security. The author infers from this that the technological savviness and exposure of Internet café owners or managers do not necessarily constitute sophisticated technological and managerial competencies relevant and critical to users’ acquisition and transfer of technological skills.

The demands for sophisticated managerial competencies among Internet café owners or managers stem from the emporium of services provided by these small firms. Makhalemele (2016) claims that the uniqueness of Internet cafés stems from the diversification of their product or service offerings, which includes Internet surfing, photocopying, retail services in addition to dining and bar services. Their services also sprawl across various geographical spaces ranging from downtown shops, airport facilities, industrial sites, suburban and peri-urban areas. Such spatial distribution presents complex temporal and spatial challenges (e.g. dealing with rivals in proximity, and time management), which demand solid managerial competencies to deal with to ensure the competitive provision of products or services.

For Wijaya and Polina (2014), PAVs describe spaces that provide public access computing and therefore provide ICT and Internet access in public spaces such as Internet cafés, public libraries, hospital waiting rooms, malls and airport terminals. Although public agencies (e.g. government departments) often provide such information access points geared at rendering easy affordable Internet and computing services (e.g. Internet, photocopying, printing, word processing, retail and dining), non-governmental organisations and small-scale businesses are now rendering such services. Wijaya and Polina (2014) elaborate that PAVs are envisaged to play a fundamental role of bestowing access to information for underserved communities, especially those individuals without ICT and Internet connections. Augmenting public access to Internet and ICT services is particularly acute to South Africa where multiple regional (e.g. provincial divide), spatial (work-home divide) and temporal variations (within or outside education institutions) persist in access to such services. Statistics South Africa’s General Household Survey (2014) highlights the heavy concentration of Internet services in the metropolitan provinces of Western Cape, Gauteng and the Free State. The same survey also reports that only one-tenth of South African households have access to the Internet at home and such access is highest in the Western Cape (23.8%) and Gauteng (17.3%) (see https:///news/telecoms/127450-internet-access-in-south-africa-best-and-worst-provinces.html). To further compound this challenge, these variations also persist between rural and urban areas, between different gender groups and across different times and temporal zones. In view of these divides, the managerial competencies of owners or managers of Internet cafés, public spaces for increased access for the socio-economically marginalised, including the competitiveness of such firms, cannot be taken for granted.

Studies on Internet access via Internet cafés have emphasised their utilisation for job searches and applications (Dammert et al., 2014), the inculcation of computer literacy among marginalised groups in informal urban slums (Hansson & Wihlborg, 2011) and the unravelling of gender variations in university students’ intentions of and behaviours when visiting Internet cafés (Hsu & Chuang, 2008). However, an incommensurate attempt has been made to explore the intersection between Internet cafés and managerial competencies of their owners or managers. Research that has approached this intersection closest includes Temtime and Pansiri’s (2005) exploration of the managerial competency and organisational flexibility of Botswana SMMEs, which reported that the critical managerial factors affecting the development of SMMEs are human resources development; organisational development, managerial background; managerial leadership and competitive strategy. Nonetheless, their study was not anchored in technology-oriented businesses per se. Bouazza, Ardjouman and Abada (2015) and Aylin, Garango, Cocca and Bititchi (2013) attribute the growth of SMMEs to the proper application of a set of managerial competencies while the paucity of such competencies is considered to hinder firm growth. Although the study by Bouazza et al. (2015) elaborates on the distinction between managerial competencies, managerial capacities and managerial competencies, this study was conducted in Algeria and did not explore Internet cafés in particular.

The concept of managerial competencies cannot be sufficiently comprehended without grasping competencies. For Jauhari (2006, p. 123), competencies refer to ‘observable and applied knowledge, skills, and behaviour that create a competitive advantage for an organisation’. As such, managerial competencies describe those demonstrable knowledge, skills, abilities and behavioural traits that an owner or manager of an Internet café should possess to effectively accomplish their entrepreneurial and managerial duties to generate financial value for the organisation. Fejfarová and Urbancová (2015, p. 111) define managerial competencies as ‘a specific type of individual competencies; for example, specific knowledge, abilities, skills, traits, motives, attitudes and values necessary to improve management performance’. Implicit in this definition is the possession and effective application of psychological, technical and emotional dispositions relevant to task performance, which ultimately ensure organisational effectiveness. Therefore, managerial competencies are a combination of the manager’s professional knowledge, acquired skills, experience, traits and the proper attitude and motivation to act on-the-job (Szczepańska-Woszczyna, 2014). These are internal capabilities that people bring to their jobs, which may be expressed in a broad and even infinite array of on-the-job behaviours and enable successful performance of the job. The contemporary concept of managerial competencies is broad, closely related to human capital and encapsulates talents, predispositions, interests, internal motivation, education, knowledge, professional experience, practical skills, attitudes, behaviours, characteristics and the right to act on behalf of the organisation (Oleksyn, 2010; Szczepańska-Woszczyna, 2014).

Managerial competencies have generally been described differently depending on different disciplinary, functional, industrial and contextual areas. For instance, the knowledge skills and capabilities demanded in information system and ICT domains may differ from those expected in other domains, the same way skills and competencies demanded in large corporations could vary from those expected of small organisations. However, some skills, such as time management and leadership skills can be conceived as generic across different organisations regardless of size, location and industry. Nolan, Conway, Farrell and Monks (2010) describe eight competency areas ranging from professional knowledge or operational, interpersonal, communication, information technology, human resources, finance, sales and marketing skills. From an ICT perspective, Peppard and Ward (2004) formulated 26 information systems (IS) competencies falling into a nomenclature covering strategy formulation, specifying information technology (IT) needs and capabilities, IT delivery solutions and fostering and maintaining good relationships with suppliers. Cragg’s (2002, 2008) study of managerial factors and their related IS competencies emphasised competencies such as business strategy, IS strategy alignment, technology innovation, technology analysis, system and process innovation and managing change. In a masters study that examined competencies of emerging technology firms in South Africa, Makhalemele (2016) identified three main competencies that are most critical: innovation management capabilities, market management capabilities and resource management competencies. Consistent with her analysis, the following sections discuss this typology of managerial competencies.

Innovation management competencies cannot be grasped fully without defining innovation. Szczepańska-Woszczyna (2014, p. 14) defines innovation as ‘the implementation of new ideas and introducing new solutions into practice in the environment’. Innovation, on the one hand, involves the successful execution and sometimes commercialisation of creative ideas in a business context.

Innovation management capabilities, on the other hand, describe the capacity of the firm to effectively manage its internal innovations in ways that optimise its performance and create value for the firm. Therefore, innovation management capabilities involve those capabilities required in the innovation value chain, that is, the entire innovation process ranging from the innovation input (supplies, materials and resources), innovation process (administrative procedures and techniques applied to the processes of transforming input into output) to innovation output (products, services and logistics) (Barosa & Cintra, 2012). Depending on the size, scale of operations, industry and broad context the firm operates in, innovation management capabilities may take the form of accepting changes in product design, marketing, network management and supply chain management systems, creative thinking about products and services and the successful management of change (Quinn, Faeman, Thompson, & McGrath 2007; Ziębicki, 2011). Innovation management capabilities also entail system-wide competencies that cover improvements in information systems, technological innovations, research and development (R&D) activities and the clientele affairs of an organisation (Laakso-Manninen & Viitala, 2007). It implies the application of creative problem-solving skills to develop solutions to organisational problems and adopting ‘smart’ risks during decision making (State of North Dakota Competency Library, n.d.) while fostering the personal development of employees through successful creative participation in organisational activities (Königová, Urbancová, & Jiří, 2012). While small Internet firms are often constrained financially and in terms of human capital to participate in R&D activities and to rollout wide-scale technological innovations, they are more predisposed to engage in creative problem-solving to address problems peculiar to their size and scale of operations.

In the service industry, including Internet cafés, innovation management competencies can translate into firms’ foresight to ‘think for the customer’ by creating services that offer superior value to the customer through leveraging knowledge resources and specific stakeholder relationships (Kandampully, 2002). Therefore, innovation management competencies have the potential to improve products, services, processes and transform organisational structures. In the view of Walker, Damanpour and Devece (2011), these competencies allow the firm to achieve production and marketing goals, improve product or service quality, lower their operational costs, increase their market share, attain production flexibility and improve the management process.

Market management capabilities are a bundle of market, human resources and organisational competencies, which a business employs to access, retain and augment its customer base through the generation, dissemination and articulation of customer value. These capabilities have evolved over a long history even though the theme of creating and retaining satisfied customers remains central to the advancement of market management competencies (Day 1994; Narver & Slater 1990). Often articulated under the banner of market orientation, market management competencies emphasise a clear recognition of the superiority of target customers (Day, 1994), the capacity of the firm to generate, disseminate and deploy superior information about customers and competitors (Kohli & Jaworski, 1990) and the creation of superior customer value through the coordination of firm’s resources (Narver & Slater, 1990).

Since the 1990s, market management capabilities have evolved from creating satisfied customers to appropriately managing the marketing process, which includes analysing market opportunities, formulating clear marketing objectives and developing a marketing strategy that should be implemented and controlled (Kotler, 2004). Such a determination of the marketing process involves ascertaining whether and the extent to which a firm is effectively managing market research, marketing strategy, planning and implementation, control and evaluation (Banterle, Cavaliere, Stranieri, & Carraresi, 2009). Managing market research involves capacity of the firm to locate good partners in an investment destination market, possession of adequate market knowledge of the targeted country market, development of export competencies and knowledge of the market language and cultural differences (Brancatisano, Jurriëns, & Verburg, 2012). For Banterle et al. (2009), marketing strategy entails the formulation of marketing objectives and organising activities consistent with opportunities opened in the market. Planning and implementation is integral to the success of the marketing management process in the same way formulation of a marketing plan is critical to the achievement of marketing strategy objectives. Control and evaluation revolve around determining the extent of success of the outcomes of the marketing activities in terms of sales and profit.

Drawing on Day’s (1994) conception of a market-driven firm and the ever evolving conception of marketing which now incorporates networking competencies and collaborative capabilities, Ritter (n.d.) conceives marketing management process as encompassing market making and market prioritising as additional capabilities. Ritter (n.d.) summarises the marketing management process as involving four main processes, namely, market sensing, market relating, market prioritising and market making. Often articulated as market orientation (Jaworski & Kohli, 1993; Narver & Slater, 1990), market sensing encompasses market intelligence to grasp the dynamics of the market operations. This process of knowledge management involves acquiring, sifting and synthesising information with a view to improve the performance of the business. This capability entails the business’ exploitation of its current knowledge of markets (e.g. customer preferences and tastes, potential and actual competitors and partners) and its capacity to generate new knowledge that favourably positions it strategically in its chosen markets (Hou & Chien, 2010).

Market relating involves attracting and strengthening the business’ relations with the market and its customers. For Ritter (n.d.) market relating encapsulates the process of building bridges between the business and actors in the environment such as customers, suppliers, research institutions and government. This has also been perceived as relationship marketing (Berry, 1983; Berry & Parasuraman, 1991) and transaction marketing (Coviello, Brodie, Danaher, & Johnston, 2002) covering the creation of strong bonding ties and other distant relationships. Such relationships can be founded on logistics planning competencies geared at reducing distribution cost and improving customer satisfaction by providing products at the right place in the right condition at the right time (Christopher, 2003; Dubey & Ali, 2011).

Market prioritising involves the selection and prioritising of important individual and group customers on a transactional basis as not all customers are equally important. Lastly, marketing making is founded on the instability of the market, its networks and a lack of a predetermined structure of operations. This gives rise to the need for the business to provide innovative offerings continually, maintain the dynamics of standardised markets and creating new niches through challenging the logics of the market. Therefore, these market management capabilities transcend the firm’s capacity to demonstrate responsiveness to customers’ needs to generate market innovation and attain a competitive advantage (Dubey & Ali, 2011; Nguyen, 2008). Internet cafés may not be good candidates for market prioritising as a result of the small client base they serve and their low resource base, which undermine their logistics planning and implementation.

Resource management capabilities cannot be grasped fully without articulating what resources, resources management and capabilities are. Resources can be conceived as organisational assets – that is (diverse physical and organisational) endowments the business has accumulated (e.g. investments in the scale, scope and efficiency of facilities and systems; brand equity; and the consequences of the location of activities for factor costs and government support) (Day, 1994). These resources range from tangible resources (e.g. physical IT infrastructure), human IT resources (e.g. technical IT skills and managerial IT skills) and intangible IT-enabled resources (knowledge assets, customer orientation and synergy) to valuable resources (helping an organisation to create or implement strategies that improve its efficiency and effectiveness). Lastly, resources are rare when more organisations want them than are able to obtain them, imperfectly imitable and non-substitutable when they are immobile and expensive to imitate or replicate (Barney & Hesterly, 2006; Bharadwaj, 2000).

In a narrow sense, resource management entails fiscal resource management, that is, the capacity of employees to effectively carry out the responsibility for planning, raising, allocating, spending and managing monetary resources to complete individual, group, unit or department, or organisation-wide work activities (State of North Dakota Competency Library, n.d.). From a human resources perspective, resource management involves developing a more integrated and well-coordinated approach to designing improvements to human resource management systems, job redesign, recruitment, organisational learning, career management, performance improvements and compensation systems (UNIDO, 2002). In its broad sense, it covers planning, project and budget management, information management, change management and organisational performance assessment (Krajcovicova, Caganova, & Cambal, 2012).

Capabilities can be conceived as the adhesive which brings organisational assets together and enables them to be deployed as a source of competitive advantage (Day, 1994). While assets can be assigned monetary value, capabilities cannot, as they are deeply embedded in organisational routines and practices and cannot be traded or imitated (Day 1994; Dierckx & Cool 1989). Therefore, resource management competencies describe those competencies that enable the well-coordinated and integrated deployment of financial, physical, human, organisational resources (e.g. quality control systems, corporate culture, and relationships) and technological and intangible resources (e.g. reputation, brand recognition, and goodwill) (Braganza, Brooks, Nepelski, Ali, & Moro, 2017; Grant, 1991; Mahoney & Pandian, 1992) to increase the competitive advantage of the firm. Based on this, the resource domains that could be most relevant to Internet cafés include human resources, finance (including fund raising) and organisational changes because of the size and scale of their operations.

Profitability is one of the prominent measures of business performance. Small business owners seek to achieve profit and other economic benefits (e.g. increasing revenue and employment levels) through bearing calculated market risks (Carland, Hoy, Boulton, & Carland, 2007; Ndofirepi, 2016). The common measures of profitability include sales revenue, gross profit, net profit, percentage return on investment and an increase in employment figures (Gumbochuma, 2017).

Principal component analysis (PCA) was carried out on each of the elements that sought to measure each of the four variables, namely, innovation management capabilities, marketing management capabilities, resource management capabilities and profitability of the business (see Table 1 for the factor loadings for each variable).

The Kaiser–Meyer–Olkin (KMO) values derived are greater than 0.7, which is more than the minimum acceptable threshold of 0.5 (Field, 2009), validating the sampling adequacy for the analysis. Furthermore, the result of p < 0.001 for Bartlett’s test of sphericity demonstrates that correlations between items were sufficiently large for PCA. A factor loading value greater than 0.5 shows a relationship between the individual measuring items constituting a variable (factor). The structural validity results for each of the variables, and the subsequent factor analysis, are reported in Table 2. The results of the factor analysis suggest that all questionnaire elements intended to measure the four constructs and should be retained. These include innovation management capabilities, marketing management capabilities, resource management capabilities and profitability.

About 84.8% of owners or managers agreed or strongly agreed that their businesses imparted technological knowledge on their employees to produce new products or services. This corroborates Rambe and Dzansi’s (2016) finding that effective technology adoption demands not only the shared intentionality among a distributed core group of employees (i.e. technology implementers) at the lower rungs of the organisation but also the sufficient buy-in of senior management.

More so, 84% of the respondents were of the opinion that their businesses valued the skills of introducing new business systems frequently. This finding corroborates evidence in entrepreneurial literature on the value of infusing necessary skills such as project and business management skills in the successful conceptualisation and incubation of new business start-ups (Lindgren & Packendorff, 2011; Ramirez-Portilla, 2013).

About 79% of the respondents agreed or strongly agreed that their businesses employ participative decision making on the purchase of new stocks or products. This view supports Liang, Huang, Lu and Wang’s (2015) finding that individuals’ direct participation in collective activities positively impacts organisations’ economic activities. The other finding was that 77.7% agreed or strongly agreed that their businesses developed unique ideas and creatively transformed existing products into new products. However, the peculiarity of this finding is that most SMMEs such as Internet cafés do not really sell new unique products but rather engage in ‘replicative entrepreneurship’ (Ndofirepi, 2016) in which they market and sell already manufactured products and services.

The majority (61.9%) of the respondents agreed or strongly agreed that their businesses equipped their employees with marketing skills before promoting their products or services. This finding seems to cohere with Agbobli’s (2013) claim that resource mobilisation (including sufficient marketing training of staff) should precede the identification of markets and launch of products. Market training is critical to the identification of existing and new markets, the location of market gaps and developing interventions to breach them, in addition to the development of employees’ sufficient knowledge of products and services before they can market them successfully.

The findings demonstrate that a majority (86.1%) of Internet owners or managers agreed or strongly agreed that they displayed leadership qualities that guided employees in achieving their set goals. However, Internet café managers’ exercise of leadership, power and authority may vary depending on whether the manager is a member of the family that owns the business or not. The studies by Ingram and Simon (1995) and Moshavi and Koch (2005) found that non-family managers of SMMEs were often less capacitated to exercise leadership and exert influence, and their decisions tended to be given less weight and priority than those of family members. These variations could be attributed to the non-family managers’ limited influence in decision making processes of family-owned businesses.

With regard to funding capabilities, the study examined the extent to which businesses were capable of raising funds for the purchase of equipment, products or services. The findings suggest that 84.8% of the owners or managers agreed or strongly agreed that their businesses had the capacity to raise such funds for the purchase of working equipment, products or services. Consistent with the resource-based view, the findings corroborate the view that firm resources (finance, skills, knowledge, experience and capabilities) are not limited to the possession of firm-specific resources but also to the effective utilisation of these resources to achieve competitive advantage (Ramorena, 2016). The current researcher argues that most Internet cafés displayed resource mobilisation capabilities as they could raise their capital with limited external support (e.g. external borrowing).

The findings highlight that 78.4% of the Internet café businesses owners or managers used skilled employees to facilitate systemic changes in their organisation. This finding somewhat contradicts studies in the construction industry in which highly skilled employees were largely concentrated in large organisations such as Murray and Roberts, Aveng, WBHO, Group 5 and Basil Read compared to emerging contractor firms (Construction Industry Development Board, 2015; Ramorena, 2016).

The finding that 49.5% of respondents agreed or strongly agreed that their businesses selected employees based on their experience, qualifications or skills somewhat contradicts biographic data in Table 5 that state that 55% of respondents were less educated (i.e. had a matric qualification and below). It is not clear whether this contradiction arose from respondents’ slight variations with regard to the experience and skills of their employees or was a consequence of different employees judging the attainment of matric differently (e.g. as an achievement or not).

The highest ranking profitability attribute (87.5% agreed or strongly agreed) was that most of the businesses were driven by a need for continuous improvement of their products or services to raise profitability. However, this finding on continuous improvement – itself a component of innovation – seems inconsistent with the lower innovation or growth effect size reported in preceding sections of this investigation. Table 9 presents results from the questionnaire items that addressed the profitability of the businesses surveyed. Most participants (72.3%) believed that over the previous 3 years their businesses have increased their profit margins, been able to raise salaries and wages from profits (72.3%) and have been able to generate profit (76.2%).