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Let's talk... Cultivating Entrepreneurship in the new Europe by Jørn W.Phigalt, CEO ITM Europe, Denmark – one of the 25 member states of the European Union - phigalt@itm-europe.dk
The globalisation wave in the new digital economy and the constant call for internationalisation for SME’s in the high-tech sector has created an unpredictable and turbulent marketplace, especially regarding exchange of business practice, knowledge sharing and human relations across the globe. Never before has it been so attractive and yet so difficult to do global business and to work interactively on the international market. Entrepreneurs are needed in nearly every corner on the globe and the constant growth puts heavy demand on this group, to come forward with new thoughts, new solutions and new methodologies. Many governments have a development policy that tends to educate entrepreneurs for exciting opportunities – both for the private and for the public sector, and since SME’s have been recognized by the EU Councils, the US Government and United Nations as a policy priority for the new economy, there is no reason to wait and evaluate what will happen. It is the entrepreneurs who makes thing happen, not a pre-planned guide for success. Do not confuse start-up companies with SME’s and do not equalize entrepreneurs with SME’s, but the creation of new jobs is much higher in SME’s with 30-40 employees that for entirely new companies, where it can be a painful experience to just get income and sufficient capital to create a company, in spite a brilliant idea and a project with a break-through new technology solution. Also competition has its price for quite new companies, who do not have the power to strike back. Here a more mature SME have much better chances to overcome a treat and to re-focus, as they add more resources into the battlefield.
The advantages of an International Business Strategy In any case, the creation of an International Business Strategy will for all types of SME’s be a valuable tool. It is not the strategy and detailed plan itself – it is the journey that leads to the final result that is the outcome of the creation process. The strategy and plan should give answers and directions to a number of mission critical issues, and can be used for immediate penetration of priority market area’s, design modifications related to demands from customer groups, internal clarification of policies and strategies, feasibility of innovations, investments and branding exercises that will shape the image profile of the company, the products and the services. Furthermore the International Business Strategy is an excellent tool to secure financial support at various sources, like banks, investment councils, the European Union and venture Capitalists, too. Many SME’s have started their company with only a weak idea of what direction they want to take, and how to implement this in an effective way. For many companies it is now time to re-orientate the enterprise and to get re-focuses on the values of the company, the innovations and the future plans and directions. Also here it is important that the company start the process by designing their own International Business Strategy. It will be a re-shaping exercise taking of in the existing set-up and the pragmatic approach that many companies have been forced to take, due to lack of financial support, limitation in competence or carried out tasks due to opportunistic views. In those cases a great portion of efficiency dialogues and tasks need to be carried out, and in many cases those leads to increased competitiveness and new options. Sale is still the single most challenging issue for SME’s and here the International Business Strategy’s section of global penetration plays a major role. Sale is a lifestyle for many and a task that do not have a university degree, a special path to follow or a set of rules and Best Business Practice to grasp. Sale is a number of tasks that reflects the products and services that have to be marketed and eventually sold to the customers – either directly or through a channel. To understand and select the right distribution channel in the enterprise’s global strategy is evident for an SME. The channel strategy, the hirering and training process for the sales staff, the image profile for the company, the after sales service and the branding concept, need to reflect the products and especially the competitive trading conditions.
Avoid Brain Drain at SME’s One major obstacle is still the lack of qualified resources at SME’s, because it is too costly to recruit and to maintain the motivation of the employee, if there is no visible future in the company. Many young students uses their first job as a springboard to a new and more exciting job position in a larger organisation with higher risk taking R&D budgets, better innovative projects and more true internationalisation. Few SME’s can give that right away, and are reluctant to go for specialists and new innovative employees, as they in too high degree are focusing on the few years they can have before they have to face the fact that the highly skilled employee will leave and they have to start all over again with new employees. The International Business Strategy can make a stop to this obstacle, as it can give a valid proof for the vision, the perspective and a well-documented future in the company. Using the International Business Strategy in the recruitment process has become evident for many SME’s.
PartnerShips for the future
What EU in Brussels can do for SME’s Well, actually not a lot, as most entrepreneurs expects, unless you have a magnificent creative idea, a good prepared business plan and a number of accompanying partners who can make a difference. It might seem harsh, but the reality is, that too many entrepreneurs anticipate that they just can get funding from ‘Brussels’ to finance their daily business life. This is not the case – on the contrary – the idea by getting funding from the many framework programmes and projects in EU, is to share knowledge and limit risk. The European Union has many programs, many ways of assisting companies and many opportunities to offer, if the enterprise looks for a planned and structured approach. To this end you once again need your International Business Strategy. Based on this it is an overcoming task to launch a dialogue with the many skilled employees at European Commission level, who gladly will assist with information, in-sight knowledge and guidance.
The innovative process A huge number of entrepreneurs and SME’s see the process of developing a business strategy and plan as an overwhelming assignment – awfully expensive, time consuming and taking focus away from the ‘main objective’ - to earn money here-and-now. This is not the way it should be - and reality also shows that you can launch the process easily, as you follow a pre-defined road-map for construction of the strategy and plan, at a low investment and with a fair and reasonable time use. The best way to launch the process is still to listening to others, as you take advantage of Best Business Practice from their successful process. In the strategy dialogue it is the vision and the perspectives that add to the uniqueness of your business – not the tools and methodology used to mould and clarify the directions and ideas. It is not the agenda for the various sessions and the surveys to back-up the messages, but how they are interpreted and melted into your entrepreneurship’s directions and visions. It is not the techniques that can be acquired, but the practical implementation of those – and most of all the exciting dialogue based on real business critical issues and not fake business stories based on wishful thoughts and dreams.
Go for IT It cannot be underestimated the value of the process of creating the International Business Strategy and Plan. Not only because of the course of action this will give, but also of the numerous aspects it will cover, the use for motivation, the future perspectives, and the significance for entrepreneurs, who want to have a future in the New Europe.
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Just
like PartnerShip and Customer RelationShip - EntrepreneurShip is one of the 3
vital elements in the business development agenda for Small and Medium sized
enterprises. As SME’s still constitute the overwhelming majority of all
companies – both in Europe and USA, they are the driving force in the
knowledge-based economy with positive innovative thoughts, creating initiatives
and implementing state-of-the-art technology solutions to mission critical
business problems. In today’s technology focused world they need to look
international to secure a continuing presence and to continue to push for new
market opportunities – especially in the new Europe. Adding 10 new countries to
the European Union has been a long process – and the journey have just been
launched according to the politicians. The industry however, have for a long
period considered the new member states as an integrated part of the European
market of 450 million consumers, and have launched initiatives to penetrate the
newcomers home markets – waiting with anticipation on the massive attempt of
business penetration from East to west – an expected ‘invasion’ of new idea’s,
new initiatives and new business constellations. Up to now it has been very weak
– close to disappointment, not to see the huge potential in ‘former Eastern
Europe’ on the scene in the rest of Europe.
Another issue
is the fact that highly skilled resources are moving around on the globe as the
roam for better job opportunities. They leave their home country pursuing the
opportunities of more ingenuities enterprises – looking for dynamic
entrepreneurs with whom they can work and expand ideas. This leaves countries,
which normally were incubation centres for entrepreneurs and experts behind -
lacking qualified resources for their home industry. The new economies are
focusing heavily on educations and are today bringing numerous specialists to
the market, but many times placed in the wrong corner of the world, at the wrong
time, and with the wrong opportunities. Sharing critical resources, Best
Business Practice and specialized knowledge is essential in the new digital age
and once again the International Business Strategy can clarify that there is
options in close partnerships with Research and Development institutions in the
new Europe, with visionary entrepreneurial enterprises, with universities and
innovation parks – of course if the SME understands the importance of such
alliances in PartnerShips. Besides having an intention of creating partnerships
for Research & Development, Marketing, and Sales - the true value and benefits
is also the enormous knowledge sharing in Market intelligence, Mentality
understanding, Matchmaking and information that the SME will get.
ITM