The Financial Express


Developing enterprise skills for economic growth

Evaly and Fianancial Express Evaly and Fianancial Express
Developing enterprise skills for economic growth

The importance of enterprise as the main source of economic growth and employment can hardly be overstated. Economic growth is fuelled, first and foremost, by the creativity and hard work of entrepreneurs and workers. Driven by the quest for profits, enterprises innovate, invest and generate employment and wage income. Enterprise and small business today seem to be entering a new phase of development. The speed of global economic change, which has been leaving some countries and some social groups seemingly high and dry, has forced everybody concerned with the development of poor and relatively poor people to look towards new kinds of economic solutions to old economic problems: a more complex interaction with funding sources and better understanding of the nature of market forces. New projects that encourage small and micro business are well supported by international funding and development agencies, including the latest enterprise skills. The articulation of small business with the full range of economic infrastructure is becoming better understood and managed, though there is still a long way to go, and large numbers of small enterprises still fail because the needed supports for success are not part of the economic development framework. The Commonwealth publication 'Promoting Enterprise and Economic Development' intends to demonstrate the links between youth in development work and economic progress. It shows how aspects of informal education can help the young people to develop their enterprise skills and undertake projects which could promote economic development. In particular, the module covers the skills needed to promote self-employment amongst both young women and men, including setting up micro-enterprises.

The module begins with the unit "Enterprise and Economic Development" which explores the concept of economic development and discusses the effects of British colonialism and industrialisation on the economies of less developed countries. It also examines world economic trends since World War II, and looks at some theories of economic development. British colonialism fundamentally altered the old economic and social structures throughout what is now the Commonwealth. In large areas of India, for example, by undercutting the prices of cotton and woolen goods, it broke up the village handicraft industries, forcing enormous numbers of peasants into exclusive dependence on agriculture. However, at the same time, the colonial power built a railway system alongside huge reserves of coal and iron. As this example of India reveals, colonialism left a mixed legacy to newly independent countries and this adds to the complexity of their economic situations today. But colonialism is not the only factor to be taken into account when considering a country's development.

The second unit looks at enterprise at the local level. It discusses the concept of small enterprise, including the qualities of entrepreneurs and the benefits they and their small businesses bring to the economic development of a country. Definitions relating to small enterprise development actually vary depending on the person using them and their context. Generally, it's best to define 'small enterprise' as having some characteristics: i) It has a small share of the market. ii) It employs a small number of people. iii) It is independently owned - with the management and control in the hands of its owners. iv) Management is personalised rather than formal. v) It is not part of a large group. This unit also examines how the roles of governments and NGOs are gradually changing in relation to small and informal enterprises.

The third unit of the module begins with a discussion of the meaning of enterprise, then goes on to examine social and personal barriers in the way of enterprise. Then it looks at ways to support and guide youth enterprises and provides a checklist of the key details. The unit continues with a discussion of creativity and its relationship to successful enterprise activity - and there are a range of exercises to test and enhance creative thinking. Unit-4 titled "Planning a Micro-enterprise" gives detailed guidelines on how to plan and operate a micro-enterprise in the informal sector. It explores the process through an extended case study. Young people can play an important role in establishing micro-enterprises in local communities. It is also important to recognise that small enterprises provide youths with opportunities to develop a range of skills and knowledge. It also helps develop qualities of leadership, confidence and self-esteem.

The last unit of the module provides some practical tools required to operate a small formal business enterprise in a local community. It takes the form of a workshop and provides a step-by-step approach to training others to acquire these skills. All over the world, small business enterprises have a high failure rate. Many studies indicate that a significant cause of failure in small business is poor management skills. One way to avoid small business enterprise failure, this chapter suggests, is to think hard, gather information and prepare the ground carefully. In this regard some step-by-step guidelines can be followed: i) finding an opportunity; ii) identifying the market; iii) knowing the product; iv) researching the industry; v) gaining experience and knowledge; vi) working out the costs; vii) working out legal and practical issues; viii) developing management skills; and ix) developing a business plan.

S.M. Rayhanul Islam is an independent researcher.

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