Book of Economic Development and Entrepreneurship

Small, micro and medium enterprises (SMMEs) play an important role in developing countries, including alleviating poverty, reducing unemployment and improving the fair distribution of income. However, most of these businesses fail within a few years of operation. Literature claims that these challenges are severe for the businesses operated by women. Considering the role played by SMMEs, it is necessary to invest in initiatives that help to improve their performance. The study investigated the mediating effect of strategic planning on the relationships between strategic thinking, strategic innovation and the performance of women-owned small businesses in South Africa. Quantitative research approach was used. Data was collected from women entrepreneurs operating in the Eastern Cape Province using convenience sampling. Data was collected using a self-administered questionnaire distributed using convenience sampling. Statistical tests used in this study include Multiple Linear Regression and factor analysis. The mediation effect was tested using Partial Least Squares Structural Equation Modelling (PLS-SEM) via SmartPLS 4, suitable for examining mediation with moderate sample sizes. The results suggest that strategic thinking and strategic innovation positively influence business performance. It was also reported that these relationships are significantly mediated by strategic planning. The findings from this study contribute to the literature on women entrepreneurship, strategic management, and small business performance, offering practical insights for policymakers, educators, and women entrepreneurs on the value of strategic thinking, strategic planning and strategic innovation in improving small business performance. Recommendations were provided to women entrepreneurs and parties that provide support to women entrepreneurs.