News Column

Entrepreneurship Development for Sustainable Management of SMEs

June 2, 2014

In this discourse, Dr. Amachukwu Chibuzo Okezie, the Deputy Director, Banking Supervision Department of the Central Bank of Nigeria, CBN, Lagos in a paper presented at the Annual College Lecture of the College of Management Sciences, of BELLSTECH, Ota, canvasses for the creation of enterprise, innovation and value for small and medium scale enterprises to thrive in Nigeria... The 2012 general household survey conducted by the National Bureau of Statistics revealed that 23.9% of adults who can work are unemployed. Worse still, it is believed that some graduates, products of our universities, are unemployable. This is one of the reasons why the Nigerian Universities Commission (NUC), recommended the introduction of Entrepreneurship as a course in the universities. These underscore the urgent need for developing budding entrepreneurs who will be, self - employed and also employ others, thereby having a twofold impact on reducing unemployment. Majority of these entrepreneurs start as small scale business enterprises.

The current trend, therefore, is that both developed and developing countries are turning to small and medium scale enterprises and entrepreneurs as means of economic development and a viable means of solving social and economic problems (Ayozie and Latinwo 2010). It is important to note however, that as in Wim (2013), improving the quality of entrepreneurial ability means not only improving skills and education of entrepreneurs, their human capital, but also focusing on the innovative abilities of entrepreneurs. To achieve sustainable management of small scale Business Entrepreneurs, therefore, we must have a distilled definition of the entrepreneur and accurately situate him in the economic space. This is the only way to be able to design a fitting cocktail of plans and policies that will ensure the development of entrepreneurship for the sustainable management of Small Scale Business Enterprise. For the entrepreneurship development programs to work, they must be founded on clear understanding of the endogenous variable on which successful entrepreneurship depends ( Ramachandran, 2009).

The problem

For well over 200 years, there have been disparate views regarding who entrepreneur is and the meaning of Entrepreneurship. Economic and sociological approaches have largely addressed the process and function of the entrepreneur, whilst under - theorizing his nature (Chell, 2008). As a result plans and programmes aimed at developing entrepreneurship have been partially satisfactory at the best (Botin, 2009 and Ramachandran,2009) . In addition, the concept and requirements of sustainable management have metamorphosed over the years and must be put perspective for clarity.

Sustainable management

Sustainable management is defined by the Wikipedia as, ' the application of sustainable practices in managing businesses in a way that will benefit the current and the future generations'. In the Brundtland Commission Report, it is described as forms of progress that meet the needs of the present without compromising the ability of future generations to meet their needs. There are several other definitions, but this paper aligns with Dr. Karl Henrik- Robert, MD/Founder, the Natural Step, Sweden who posits that:

"... sustainable management involves moving from linear to cyclical process and technologies. The only process we can rely on indefinitely as all linear processes must eventually come to an end' the key to sustainable management, therefore , is to ensure that, while making current benefits from the management of a business, efforts are made to ensure that the future is nor jeopardized" ( Botin2009).

Objective

This paper is therefore, aimed at delimiting an entrepreneur and suggesting variable on which entrepreneurship development should be based, for sustainable management of SMEs.

The construction of the entrepreneur personality

Management Vs. Entrepreneurship

Management and entrepreneurship are different. Management is the process of setting objectives and coordinating resources, including people in order to attain those objectives (Donald et al ; 2013). Managers tend to be focused on optimizing current operations. The entrepreneur on the other hand, is preoccupied not with what is but with what can be. They envision the future, recognized emerging patterns, identify untapped opportunities and come up with innovations to exploit those opportunities. Entrepreneurs pursue opportunity regardless of resources controlled, by demonstrating creative capability in obtaining and leveraging resources, overcoming obstacle, mitigating and risks and persisting in implementing new ideas that represent changes.

Requirements for developing entreprenures that can nuture and manage small businesses on a sustainable basis.

Scout for big dreamers

Train potential entrepreneur to locate and determine the commercial quantity of the overlap of passion and aptitude.

Train to focus

Have a good implementable rolling plan

Handling failure and rejection

Continuous innovation and improvement

Learn to promote and Advertise

Have a mentor and a coach

Have incubation attachment

Life/ work Balance

learn the hire/ outsource option

Learn to lead

An entrepreneur is first a leader then a businessman or woman. Anyone who lacks the essential qualities of a leader should not dabble into entrepreneurship and hope to make it on a sustainable basis. Nonetheless, the good news about leadership is that it can be learned. The first outstanding mark of a leader is that s/he is one given to vision. Basic form moreover, a leader is focused; he is not driven by wind of new events to derail him from his drawn course. A leader consults with his team and communicates effectively.

Think big ready to start small

Think global, but act local. An entrepreneur that would bring up a success story must think big because things might grow rapidly before his eyes and unless he is prepared, thing will fall out of the control. Start small, don't wait until you can move mountains, start moving the small boulders in your local environment. Thinking big and wanting immediately act big is a sure recipe for disaster. Indeed , waiting until you can mobilize enough capital to act big is a de - mobiliser.

Use the internet

Technology is moving at a fast pace and anyone who ignores just one wave might become a dinosaur by the time the next wave rolls over him. Your website is your first free and exclusive advertising zone and there are several opportunities provided by the internet to draw a multitude after you to regularly visit your website. You should learn about them and take full advantage of them. This is one sure way to make your mind. Constantly searching for information on our business on the internet can place you ahead of competition in your locality,

Be liberal but tame your overheads

Some entrepreneurs couldn't differentiate between revenue and profit, between overheads and personal expense. A man engaged a consultant and asked him for a breakdown of his overhead. It was discovered that 90% of his so called overheads were unnecessary personal social expense. Indeed, many enterprises have been wiped off by reckless overheads of owners.

Know when to move on. The people of the south East Nigeria have perfected this art. They sure know when to move from doughnut to newspaper vending, from newspaper to second hand clothes and bags and from there on to spare parts dealership and then bigger import export business. The owners did not know how or when to move on to something bigger. Their businesses became unsustainable.

Take insurance

Generally in this part of the world we have some contempt for insurance, but if you are in business you should have some respect for insurance particularly fire, flood and theft insurance. In case of natural disaster, it would be easy for you to gather yourself together again and continue in business. Many victims of fire incidents have become destitute entrepreneurs and this is largely avoidable.

CONCLUDING REMARKS

The nature of entrepreneurship has been captured in seven perspectives:

Creation of enterprise - founding of new ideas and business venture where none existed before

Creation of innovation - unique combinations of resource that make existing methods or products obsolete.

Creation of jobs - employing managing and developing the factors production, including the labour force

Creation of value - creating value for customers by exploiting untapped opportunities

Creation of growth - a strong and positive orientation growth is sale, income assets and employment

Creation of wealth - undertaking activities involving the facilitation of production of good / services in exchanged for profit.

the light of the above, entrepreneurship is a process of identifying and starting a business venture, sourcing and organizing to required resources and taking both the risk and regards associated with the venture. Sustainable management of the enterprises so created required ensuring that the profit of today does not disenfranchise the future. Sustainability of small scale business has been described by many researchers as the catalyst for national development and its crux is the entrepreneur himself.


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Source: AllAfrica