The three pillars of competitive entrepreneurship

Last weekend the spokesman for the Buy Zimbabwe campaign, Munyaradzi Hwengere, was interviewed on television about the new drive to promote consumption of locally produced goods. The interviewer asked an interesting question: What is being done to help SMEs, such as backyard juice manufacturers, attain the high quality standards necessary to compete with imported brands?

Hwengere spoke about a plan to engage the Standards Association of Zimbabwe to help SMEs implement quality control and certification systems. This is a good idea, but how many SMEs are willing to invest in quality control systems?

If you visit the informal markets in the various urban centres such as Highfield and Glenview, you won’t fail to be impressed by the thousands of hardworking men, women and youths who, despite a difficult economy and depressed demand, are making a living and surviving as self-employed entrepreneurs.

These people exhibit the essential entrepreneurial traits of idea generation, courage and persistence. And most of them have moderate financial assets, whether in cash, savings or property, to help them fund their business operations. What they lack are the three pillars of entrepreneurship.

Many informal entrepreneurs and micro-enterprises fail to grow not because they lack money, but mainly because they lack business management and marketing skills. The majority of them are not aware of the need to produce better quality products, to put in place financial and business process systems, to adopt new and modern technologies or to upgrade their human capital. As a result they cannot grow beyond the subsistence level.

Competitive entrepreneurship is what creates jobs, develops the economy, reduces poverty  and accumulates wealth for entrepreneurs. A one-man business rarely achieves any of these benchmarks. The owner usually retires poor and leaves nothing for his children when he dies.

A competitive business is continuously growing, improving the quality of its products and services and developing better processes. With time it can join the national value chains, supplying high quality, value adding products to bigger firms. Eventually the firm should be able to produce goods that meet international standards, can compete in international markets and thus earn essential foreign currency for the country.

The economy is now global. Entrepreneurs should aim to develop their firms and products to meet international standards. But the starting point should be in your vision.  Although many entrepreneurs start businesses out of necessity, that’s no reason to remain uncompetitive. Whatever stage your business is at, you can still sit down and write a plan of how to make it competitive.

If you had not written a business plan before, now is a good time to take time out to do so. This time you need to map out how you are going to build a competitive business. Your strategy should include how you are going to acquire the first pillar of success in entrepreneurship:  business skills and knowledge.

Without the essential skills of business, you are bound to make many mistakes, slow your growth and remain uncompetitive. Although knowledge doesn’t guarantee success, it provides more options and choices. If you are in business, how many courses have you attended to learn business skills and improve your business management?

And how many business books have you read in the past two months? Ask any professional person you know: a doctor, an engineer or an accountant,  how many years they spent learning the essential skills of their trade and how often they need to attend refresher or continuous development courses.

If your business is not just a hobby but something that takes a significant part of your time, energy and resources and you want to be successful, make the effort to continuously learn and stay competitive.