06/2006Nucleus-International.net1 Basics about Nuclei of Entrepreneurs and Organisational Development of Business Chambers Nucleus-International.net

06/2006 Nucleus-International.net 1

Basics about Nuclei of Entrepreneurs

and Organisational Development of

Business Chambers

Nucleus-International.netNucleus-International.net


1.

Analysis of

SMEs


One can analyse the entrepreneur and his company in two ways:

• Technically– From top to bottom,– stressing objectively existing

problems

• Socio-economically– From bottom to top,– stressing the way the entrepreneur

perceives the world subjectively


a) Technical analysis

• Poor organization, planning and management

• Poor technological input • Poor product quality• No professional training• No access to credits• etc., etc. ........

Using technological, legal and business management criteria:


• Hypothesis 1 : There is a great demand of SMEs for training, consultancy and support.This means that the entrepreneur– is perfectly aware of his needs– is always looking for breakthroughs– is always interested in learning about new

subjects

• Hypothesis 2 :The supply of services and support is poor


The strategy

• Identify of the SMEs’ needs (research)• Improve the quality and quantity of

services offered to SMEs• The entrepreneur uses the offered

services– participates in training programs– looks for consultancy– .…and starts to improve his business results


Improving the supply of services

Support Agencies

for SMEs

SupplySME SME SME SME SME

Improving the supply

Project

we know what is good for

SMEs


The favoured instrument ….

Support Agencies

for SMEs

SupplySME SME SME SME SME

Improving the supply

Project

we know what is good for

SMEs


The problem ...

• Nevertheless, many entrepreneurs do not accept and use the good service supply ...


The chamber & project does not reach the SMEs. Why?

• Either the chamber / project is good(has good intentions)

• But the target group SME is bad(does not accept the good offers)

• Or the chamber /project is bad(does not reach the SME)

• But the target group SME is good(acts according to its experiences)

The big misunderstanding : Need does not mean automatically Demand


b) Socio-economical analysis

• The country is full of SMEs with “drive”.They are– flexible– creative– serious– courageous– with entrepreneurial spirit ...

Question: Does this assumption ring true or not true in this country?


But ...

• The SME is isolated within his/her enterprise: – Does not have anyone to discuss

doubts and to develop new ideas– Nobody stimulates / provokes

him/her to look for new solutions

• Result : he/she remains in a “tunnel of thoughts”

Note: this applies all over the world!


• The entrepreneur lacks often education and professional training.Consequence: He / she never learned how to learn,how to identify and apply new business techniques in an enterprise

Question: does this assumption ring true or untrue in this country?


• Other entrepreneurs are seen as competitors = personal enemies– He / she does not talk to them– He / she does not share information &

experience– He / she does not benchmark his/her business

against others– He /she stresses the differences

rather than the common features with others

This is true in Latin America and in Sri Lanka, but not in West Africa. How is it in this country?


• The SME is not able to accumulate capital for major investments:As soon as he/she has a little bit of surplus he/she has to attend to demands for help and support of the big family

Note: This is true in Africa and the Pacific Islands!It is not true in Latin America and in Sri Lanka.How is it in this country?


• The SME perceives the world as a whole. He/she does not differentiate between– family life– entrepreneurial life and – religious life

• Therefore he/she does not run the business like a “homo economico”

This is true in many countries! And in in this country?


• He / she does not trust anybody: the world is full of “robbers”

Government

Suppliers

Clients

Banks

Business Association

Employees

SME-Support Agencies

City Hall

This is true in many countries! And in this country?


• He/she defines problems, needs and ideas in a diffuse and abstract way– Always tries to explain his/her

problems with external reasons (problem outsourcing)

– Has often unfeasible and unrealistic objectives

This is true in many countries! And in this country?


If this description of the SME is right, then there are some keyquestions:

• How to reach this entrepreneur ?

• How to gain his / her trust ?

• How to stimulate learning processes and changes ??


• Hypothesis 1:The supply of services is not the central problem

The central problem is the demand of the entrepreneursfor services


• Hypothesis 2 : Entrepreneurs are only open for discussion of those problems and needs which they perceive themselves in a subjective manner

Nobody likes someone saying: You have a problem!


• Hypothesis 3 : The identification of problems and needs is the result of a communication process of the entrepreneur with other peoplerather than the beginning

(that is why studies to identify the SMEs' needs do not provide proper answers)


Objective of a chamber & project:

• Stimulation of a communication process among the entrepreneurs

• Identification, structuring and organization of the demand for services from bottom to top

• Improvement of the performance of business chambers and associations

• Creation of networks between the business chambers and other private and public institutions


Mobilization of self-organizing forces :Stimulate, structure and organize the

demand

Support Agenciesfor SMEs

Demand

Supply

SME SME SME SME SME

Organizations of SMEs(business chambers)

Mobilisation of self-organizing and helping forces

ProjectSMEs must definewhat is right

for them


Is this case the instrument of grants and gifts is useless and inefficient

Support Agenciesfor SMEs

Demand

Supply

SME SME SME SME SME

Organizations of SMEs(business chambers)

Mobilisation of self-organizing and helping forces

ProjectSMEs must definewhat is right

for them


2.

Analysis of

Business Chambers


Characteristics of the Business Chambers in many Countries

• Only deal with ..............• Institutions of the elite,

closed to SMEs• Poor / not professionalised• Employees only administrate,

do not initiate, create ...• Do not know the affiliated SMEs• Are more Business Clubs

than Service Enterprises

Chamber

LOBBY


Another vision for Business Chambers

• Lobby is not the only taskof a business chamber

• They have two tasks:– LOBBY and– SERVICES for

the affiliated members

Chamber

LOBBY

SERVICE


Services – what for?

• To help the member in the– foundation– development– modernization– expansionof his enterprise

• To support him/her in day-to-day activities


The Structure of Services

Info rm ation T ra ining

Ind ividualC ounselling

G roupC ounselling

C ounselling S upport

S ervic es

Services requestprofessional staff !


3.Nucleus

and Group Counselling


Elements of Nucleus Counselling

Nucleus Counselling consists of 6 basic elements :

Action

Solution

Nucleus Counsellor

Nucleus

Problem and / or

Idea

Time


Definition of a "Nucleus"

A Nucleus is a Working Group ofEntrepreneurs + Counsellor

Counsellor

SME

SME

SMESME

SME

SME SME


Definition of a "Nucleus"

The Counsellor is an integral part of the Nucleus!

No Counsellor - No Nucleus !

Counsellor

SME

SME

SMESME

SME

SME SME


The Nucleus serves as

a)Communication centre to exchange know-how, experiences, problems and ideas among its members (= counselling)

Counsellor

SME

SME

SMESME

SME

SME SME


The Nucleus as communication centre

SMEs counsel SMEs !

Counsellor

SME

SME

SMESME

SME

SME SME


The Nucleus as communication centre

SMEs counsel SMEs !

The decisive question:Do SMEs put their "business secrets" on the table ?

If everyone puts 1 business secret on the tablehe invests 1 – and gets back 10, 15 or more !

Is this a good return of investment ?


The Nucleus serves as

b)Action centre to execute activities in a group

Counsellor

SME

SME

SMESME

SME

SME SME

Activity


Possible activities of a Nucleus

• Training– members and their staff– workshops, conferences

and similar events

• Visit of other institutions

– Companies of the same sector, suppliers, purchasers,

– Training, consulting, research institutions

– Business associations and chambers

• Counselling – Group and Individual

counselling– About administrative

and technical problems and developments

• Procurement of technical information and market data

• Collective promotion activities of the Nucleus-companies


The Nucleus aims in two Directions

a) Internal : to stimulate ideas and activities to improve the enterprises

Counsellor

SME

SME

SMESME

SME

SME SME

SMEenterprise

The Nucleus has service character


The Nucleus aims in two Directions

b)External : To influence the entrepreneurial environment

Counsellor

SME

SME

SMESME

SME

SME SMEThe Nucleus has lobby character:alone the entrepreneur is a nobody - in agroup hegains power


The Work Cycle of a Nucleus

initiate, invitereduce distance, build trust

identify problems / ideas

analyse problem / idea,identify causes

look for solutions inside the Nucleus

decide on activities,implement them(look for solutionsoutside the Nucleus)

... an open process, with a start but without an end!


Where to Look for Solutions

world-widewithin the country

within the region

within the town within the association

within the Nucleus


The Working Process

Time

MeetingAction

MeetingAction

MeetingAction

Entrepreneur : Action within his / her company

Counsellor : - Preparation of Nucleus meetings / actions- Execution of Nucleus decisions

Counsellor : Individual Counselling of members


4.The Nucleus Counsellor


The Nucleus Counsellor : Tasks

Moderationof meetings

GroupCounselling

Execution of activities

IndividualCounsellingof members



• Stimulation and organisation of the communication process amongst members = Moderation

• Focal point: the group dynamic• Objectives :

– High quality of the discussions– Strong orientation towards goals

No confusion, no "blah blah blah .."



• At the “right” moment, the counsellor– Participates actively in the discussion– Contributes with

- know-how,- questions, - ideas,- experiences,- comparisons,- proposals

= Counselling

Nucleus


5.The Nucleus

in the Chamber


The Nucleus in the Chamber

Chamber

Nucleus NucleusNucleus

1. Small groups of entrepreneurs (12 – 30 members)have access to professionalised services



Chamber


2. A Counsellor can attend 8 – 10 Nuclei= 100 to 200 members



Chamber


3. World wide rule in Chambers: 100 to 200 membership fees finance one Counsellor



Chamber


4. The Nucleus serves to make the Chamber more attractive …

… and more entrepreneurs apply for membership


Logic of the Development of Chambers of Entrepreneurs

ServicesInformation / Consultation

Training / Support

Lobby in front of Government and other groups of the

society

Higher attractiveness for Entrepreneurs

Law of great number:the more members, the more influence

Chamber

More Entrepreneurs apply for membership

More members pay more membership fees

More means to finance more and

better services


Logic of the Development of Chambers of Entrepreneurs

• However, this works only, if the Chamber– has open doors for entrepreneurs– wants them as members– has a membership fee system

which is recognised as "fair" also by entrepreneurs


Nucleus-International.net

• This file is part of our material to present and illustrate our activities to professional and elected officials of business associations, personnel from technical cooperation projects, and other people with an interest in this field. We are involved in a constant process of elaborating and improving this material, and targeting it to the demands of specific groups.

• You may use, copy, and change this file as you like (we do not insist on a copyright).

• We would, however, like to ask you for the following: please send us a copy (as a file or printout) and additional information if you use the file or parts of it.

• Thank you!• The Nucleus-International.net team

Documents

06/2006Nucleus-International.net1 Basics about Nuclei of Entrepreneurs and Organisational Development of Business Chambers Nucleus-International.net