ICSB Proposes an Audacious Plan to Save Small Businesses!

ICSB Proposes an Audacious Plan to Save Small Businesses!

ICSB proposes an Audacious Plan to Save Small Businesses – If we continue to think small in terms of solutions, we will be stuck in small and incremental changes

Sunday, March, 22, 2020

ICSB proposes an Audacious Plan to Save Small Businesses – If we continue to think small in terms of solutions, we will be stuck in small and incremental changes

Sunday, March, 22, 2020

An Audacious Plan to Save Small Businesses – All small businesses below 50 employees become tax-exempt as not-for-profits for 10 years.

“The world isn’t getting better, but technology is,” words spoken not by leaders but by an astute 9-year-old. The truth of that is like a thunderclap. Business innovation makes constant advancements, but oftentimes it’s at the sacrifice of humane practices. The very things that improve the quality of life for some come at a high “people” cost for very many others. Business innovation improves while humanity is removed. And that is when things are going relatively well.

The expression “desperate times call for desperate measures” may have sounded overused or laughingly cliche a few months ago, but those words have come to life around the world in just a few short months. The world, as we know it, is changing in front of our very eyes, and the aftermath of crisis will require more change, especially when we see the fractured economic crisis we are left with.

We think of economies and businesses as inanimate entities, but they are born, raised, and die on the backs of living, breathing people. They are inextricably linked, so when businesses go into crisis, so do the people who work for them. Particularly vulnerable during this time are small businesses that cannot afford to give employees extended paid leave and employees who depend on a weekly paycheck. Now is the time for large-scale measures to protect vulnerable businesses and workers, particularly seniors who face greater risks to their health and well-being.

If we continue to think small in terms of solutions, we will be stuck in small and incremental changes will only affect incremental improvements. But circumstances prove that the status quo is not enough. These desperate times, they call for, let’s not say “desperate” measures, but a well-thought-out plan. An audacious plan implemented on a global scale. What would that plan look like?

The Audacious Plan asks for the following 5 Guiding Principles:

1. All small businesses below 50 employees become tax-exempt as not-for-profits for 10 years. Small businesses are the lifeblood of their communities. Aside from selling necessary products or services, they provide social and community cohesion as well as jobs. Times of crisis like these hurt small businesses the most, which in turn harms society on a human level. When bars, restaurants, and other places for recreation suffer, socializing goes down. It should be considered a higher civic duty to make sure small businesses can survive. Countries can figure out ways to make money that don’t put a strain on small businesses. Big box stores in an area often beat up small businesses, and many of those wounds lead to their death. Giving small businesses tax exemption helps balance out the disadvantage, keep and create jobs, and generally give the local economy a much needed shot in the arm.

2. All countries establish standards for online education for a national education program for K-12 education in partnership with global IT firms. In this age of digital and virtual technology, pandemic or other disasters shouldn’t have to grind education to a halt. Citizens pay taxes for public education, but in many cases, it is not paying for alternatives in cases such as these. But even many affluent neighborhoods have schools without the ability to conduct education online, making it not solely an economic issue. The attitudes of educators need to be adjusted to view educated children as their civic duty under any circumstances where it is possible.

3. All public teachers and nurses get tax free benefits and free graduate education like veteran benefits. Teachers and nurses are a new breed of modern-day and all too often unsung heroes that should be given the benefits of such. Teachers are on the front lines trying to keep order, educate, inspire, and protect our children, whether the classroom is online or in real life. They often the first line of defense for children. Nurses help heal, comfort, and care for patients in close contact, putting their own health and well-being on the line daily. They fight a different war but a war; nonetheless, one that requires self-sacrifice. They should have the benefits of someone who serves and sacrifices for their community, including free tuition, tax-exemption, and healthcare benefits.

4. Free internet funded by local governments. Once a novel technological luxury, the internet can be very nearly regarded as a necessity in this era. Like many necessities, not all can afford it. The mindset towards internet access needs to change from being considered a private luxury to a public good. When citizens pay taxes for public services, the internet should be one of them. Internet for all.

5. A Global Small Business Congress to held on June 27 at the United Nations. For any of these guidelines to be enacted, there needs to be a meeting of minds; a summit for the people and by the people—organizations without government affiliation–to meet to discuss these plans. June 27 is the United Nations International Day for Micro-Small and Medium-sized Enterprises (MSMEs Day). The day was proposed by ICSB and presented by Argentina to the UN General Assembly. This day is our meeting point.

We need to move swiftly forward with the Audacious Plan to Save Small Businesses.

Article written by:

Dr. Ayman El Tarabishy
ICSB Executive Director
Deputy Chair and Professor at George Washington University School of Business

The Entrepreneurial Journey Part 1 – Are You Ready – The Entrepreneurial Mindset

The Entrepreneurial Journey Part 1 – Are You Ready – The Entrepreneurial Mindset

The Entrepreneurial Journey

Part 1 – Are You Ready – The Entrepreneurial Mindset

Tuesday, June 1, 2021, by Dr. Frederick Crane

Many people aspire to be an entrepreneur. But most do not really know what it takes to be a successful entrepreneur. Before you embark on the entrepreneurial journey you will need to seriously reflect on whether or not the journey is right for you and whether or not you are ready for the journey. Many experts suggest there are distinctive personal characteristics that are required to be a successful entrepreneur. Some have described this as the “entrepreneurial mindset.” There has been an age old debate as to whether an entrepreneur is born or is made. My research shows it is a bit of both – the classic nature and nurture phenomena. One thing is for sure, the entrepreneur is different from the non-entrepreneur. Less than 10 percent of our population are entrepreneurs, so they make up a unique niche within the population. So, what makes them different? And, do you have what it takes to become part of this special group of people?

 

My research shows that successful entrepreneurs share several key personal attributes that are necessary for the entrepreneurial journey. What I want you to do now is to be honest with yourself and reflect on whether you possess these key attributes and/or would be willing to acquire them? These attributes are: (1) dispositional optimism – the most important attribute – (2) persistence, (3) resilience, (4) work ethic, and (5) adaptive.

 

Dispositional optimism is a mindset that focuses on abundance not scarcity; that good things can and will happen; that one can achieve his/her objectives; and the glass is half-full and not half-empty. All successful entrepreneurs I have studied are extremely optimistic in life and in business. And, I suggest it is the most important attribute an entrepreneur can possess. In fact, it is an antecedent as to why entrepreneurs are persistent, resilient and work so hard. They did so because they believe positive outcomes can be achieved. Why would an entrepreneur work 100 hours a week to start and to grow an enterprise if they thought they would fail? Well, they don’t believe they will fail. And, contrary to belief successful entrepreneurs do not throw caution to the wind, they do not take excessive risk and they do not adhere to the fate, chance, luck or magic model of business. Successful entrepreneurs engage in calculated risk-taking using information to recognize, discover or create new business opportunities. And, entrepreneurs are adaptive. They flex and pivot given evolving conditions and situations around them. Sometimes best laid plans have to change!

 

Before you start the entrepreneurial journey you are going to have to do a head, heart and gut check – an honest check. If you get positive confirmation from all three realms of your being, then you probably ready for the entrepreneurial journey. It will be difficult and challenging but, more importantly, very rewarding and satisfying. But, this is just the beginning of your journey! In the articles that follow this one I will discuss the importance of the right opportunity, the right business model, the right brand and the right go-to-market strategy. This are all key elements that must be mastered on your own entrepreneurial journey.

Author

Frederick Crane serves as a Senior Project Manager for the International Council for Small Business (ICSB).

 

Dr. Crane is an Executive Professor of Entrepreneurship & Innovation at the College of Business at Northeastern University; Former Editor of the Journal of the Academy of Business Education; and co-founder of Ceilidh Insights LLC – an innovation management training, intellectual property consulting and consumer insight company. He was formerly a professor of marketing and entrepreneurship at the University of New Hampshire and a Chair and Full professor at Dalhousie University.

 

At Northeastern, he developed the graduate new venture creation course; the undergraduate innovation course – which is now taught campus-wide; and developed the online MBA course on innovation and enterprise growth. He also serves as the Faculty Advisor for the Private Equity and Venture Capital Club. Every semester at least one of his teams from his new venture creation course goes on to commercialize a business.

Citation of Article:

Crane, F. (2021, June 1). The Entrepreneurial Journey Part 1 – Are You Ready – The Entrepreneurial Mindset. The International Council for Small Business, Small Business Gazette. https://icsb.org/the-entrepreneurial-mindset/

Alternative Investments and Cryptocurrencies

Alternative Investments and Cryptocurrencies

Alternative Investments and Cryptocurrencies

Tuesday, May 18, 2021, by Mariya Yesseleva-Pionka

 

There are numerous investment options for traditional investment classes, such as real estate, precious metals, equity investments, fixed-income securities and cash. However, over the past few years, investors worldwide have witnessed a rapidly evolving alternative finance landscape. Cryptocurrencies or altcoins receive close attention from investors who are captivated by tremendous growth opportunities and fast and easy options to invest in them.

 

There are hundreds of different crypto exchanges around the world, each offering opportunities to buy cryptocurrencies. The majority of the exchanges have user-friendly mobile interfaces making it very easy to invest, but not all exchanges are trustworthy. When choosing a crypto exchange, it is important to compare many features such as costs, limits on withdrawing coins, lists of alternative currencies, transaction speed, trading volumes, and check if you as a user can control your digital wallet keys where your digital tokens/coins are stored. Crypto exchanges can be classified into centralised and decentralised. All centralised crypto exchanges follow the “Know Your Customer” registration process, which requires formal identification for all clients. These exchanges run their transactions on their private server and typically provide some level of insurance to protect their users if their system fails. Thus, it is essential to ask about your insurance coverage and, most notably, the amount of insurance. Decentralised exchanges do not have a central authority, and each computer inside the network is part of the server. Due to their decentralised status, they are not under specific monitoring of any regulatory body.

 

The security and safety of digital cryptocurrency tokens remain as significant concerns. Purchased cryptocurrency tokens need to be stored in a secure location. Numerous retail and institutional custodians provide services for storing your cryptocurrencies in a secure online wallet. You can also keep your digital cryptocurrencies on external devices and print keys on paper and store them physically in a safe box. However, some cryptocurrencies exchanges do not allow users to control their digital wallets.  It is necessary to understand the risk and return relationship in cryptocurrencies trading. The markets are speculative and highly volatile, so it is essential to do your research and remember you can rapidly lose your investments. It is crucial to check your tax implications for capital gains and losses when trading cryptocurrencies.

 

As one of the most popular cryptocurrencies, Bitcoin is classified as a store of value coin, also known as “Digital Gold” among cryptocurrencies. The widespread Blockchain adoption was linked to Satoshi Nakamoto back in 2008. Bitcoin is differentiated from other cryptocurrencies by having a fixed supply of 21 million tokens which can be mined.

 

Recently, concerns were raised in relation to the Bitcoin network’s energy consumption as miners are continuously running computers to solve complex algorithms/puzzles to discover a new block. Once a new block is mined, the miners are rewarded with bitcoins. The University of Cambridge’s Centre for Alternative Finance has introduced the Cambridge Bitcoin Electricity Consumption Index, which shows that the yearly electricity consumption is 150.04-terawatt hours, which is expected to grow further. Interestingly, the amount of electricity consumed by the Bitcoin coin in one single year is sufficient to provide power to all kettles used to boil water for Europe and the UK for 5 years and meet the University of Cambridge’s energy needs for 853 years.

Author

Mariya Yesseleva-Pionka

Mariya Yesseleva-Pionka

Global Certificates Manager for the International Council for Small Business (ICSB).

Dr Mariya Yesseleva-Pionka is Global Certificates Manager at ICSB, a Higher Degree by Research Supervisor at Excelsia College and Adjunct Academic at the University of Technology  Sydney, Australia. Dr Yesseleva-Pionka held teaching and senior academic management positions in Central Asia (Kazakhstan) and Australia. She specialised in general investments, personal and corporate superannuation investments while working for Westpac Banking Corporation and BT Financial Group in Australia. She was invited to join The Housing Connection, a not-for-profit organisation in Sydney, Australia as Treasurer and Board Member from November 2019. Her research interests include entrepreneurial finance, traditional and alternative ways to finance small and medium enterprises (SMEs), corporate finance, policies for the small business sector, innovation and SMEs, FinTechs and Blockchain. Dr Yesseleva-Pionka is the Associate Editor for the Journal of the International Council for Small Business (JICSB). 

Re-imagine Series: Depression

Re-imagine Series: Depression

Re-imagine Series: Depression

Monday, May 3, 2021, by Ruth Dwyer

 

Nothing in life is to be feared, it is only to be understood.

Now is the time to understand more, so that we may fear less.

– Marie Curie

Problem: Depression—lack of early detection leads to lost potential for individuals and society.

New Tech Implications:

  • Developments in sound recognition is promising for early diagnosis.
  • Telemedicine provides a convenient way for many patients to receive care that they would not otherwise engage with.

Change Hypotheses:

  • New technology available to help people self-diagnose mental illnesses virtually
  • Help doctors diagnose during visits
  • Increased publicity on how to treat early
  • New medications

Dream:

  • Everyone will have depression and anxiety diagnosed at its earliest stage
  • Increased healthy lifestyles
  • Decreased substance use
  • Increased productivity for the world

Marie Curie’s quote shown above points to so many truths. Today, I would like us to think about how the stigma attached to depression keeps us from knowing more about it. This lack of insight into an individual’s pain not only creates a bigger problem for that person, but also a big problem for the world.

Depression affects over 300 million people suffering from depression worldwide. Almost 800,000 people die by suicide a year*, AND IF treated early 80% and 90% of people with depression respond quickly to treatment and gain some relief from their symptoms within 4-6 weeks on a medication and/or therapy regimen**

Challenge Questions- What can we do?

Start at home:

  • Early detection
  • Ask these questions of yourselves and share them with you family/friends.
    • How are you feeling? When was the last time you went outside? Had fun?
    • Are you eating and sleeping regularly?
    • How do you feel about yourself? do you ever feel like hurting yourself?
    • How are things going with your friends?  Do you ever think they would be better off without you?

If these questions prompt a yes, please do not ignore them. Rather, look for information from trusted sources on the internet, talk to your doctor, a counselor, or call a helpline, and be sure you are safe.

Reflect more on safety with these questions:

  • What medications do you have in your house? Who can get to them?
  • Is there anything else in your home that could be used for self-harm?

Think local:

  • How are you, your family, and friends doing?
  • Is there someone who you have not heard from recently
  • If you have a business, where are our employee pain points?
  • Is there a way you can add- healthy habits into the workday?
  • Is there a way of serving customers that improves their social interaction/lifestyle?
  • Are there ways it can be modified to fit more or different needs?
  • Is it possible that the person that drives you nuts is driving you nuts due to a mental health concern? If so, how can you modify your interactions with them, to improve things?
  • Is there an appropriate place to post a hotline number for people to see?

Go Global:

  • How do you interact with the wider world?
  • Could you post a message of encouragement during National Anxiety and Depression Awareness Week (May 18-23)?
  • Where are your financial investments?  Does your portfolio reflect your beliefs in how to promote a healthy lifestyle?

My response to the challenge:

Over the years, I cannot count the number of children I’ve know whose lives have been affected by a family member’s depression, anxiety, or their evil triplet substance use. It is a problem that is almost always more convenient not to deal with in the short term. Like many things, however, ignoring it makes it worse. In fact, this is true more for depression than most of the medical illnesses I’ve helped treat.

As we enter the spring of our year with COVID, take stock of yourselves and those you know.  Seek help if you are currently worried about someone in your circle. I do not have an answer for coping with the devastation in any of your personal lives that depression and substance use have produced other than to again encourage you to find the energy and courage needed to seek professional help as needed.

My dream for how to impact depression and anxiety is both smaller and larger. It is smaller because I dream of minimizing its effects through early detection. It is larger because before people will accept a diagnosis or seek treatment any stigma associated with it must be eradicated. Larger, because attitudes are hard to change. As with most things the answers lay within each of us. I encourage you to become informed and challenge any assumptions you hold that do not fit the facts, or the kind of person you want to be.

The world has big problems, and everyone is needed to re-imagine solutions that meet the needs these problems create. We can’t move forward if we do not understand what forward looks like. Please help by sharing this post and engaging below.

I look forward to our conversation,

Ruth Dwyer, MD, FAAP

PS:

– Did you know April is stress awareness month?  Or that Depression Awareness Week is May 18-23? (As a student, this seems especially well placed for me, if only I had time to acknowledge it:)

– Did you know that in the US on the last Saturday in April The Drug Enforcement Administration (DEA) has been hosting the National Prescription Drug Take-Back Day each year since 2010? (if you missed it this month- don’t stress over it they will do it again next October.)*. This is a great way to decrease people’s access to something that could be deadly. –It is especially important to think about if you have a teenager, they share.

( https://www.inspiremalibu.com/blog/news/national-prescription-drug-take-back-day/)

* Torres, Felix. “What Is Depression?” American Psychiatric Association, 2020, www.psychiatry.org/patients-families/depression/what-is-depression.

**Bach, Natasha. “World Mental Health Day 2017: Illness in the Workplace Is More Common Than You Might Think.” Fortune, World Health Organization, 10 Oct. 2017, fortune.com/2017/10/10/world-mental-health-day-2017-workplace-depression-anxiety.

Author

Ruth Dwyer

Ruth Dwyer

Senior Project Manager

Dr. Ruth Dwyer. MD,  serves as the Senior Project Manager for the International Council for Small Business (ICSB).

Pivoting pediatrician interested in social entrepreneurship, small businesses, and the SDGs. Ruth has worked on numerous medical startups. She enjoys painting, playing games, shooting hoops, and time with my family.

AACSB and Entrepreneurship: How An Accreditation Association is Paving a New Path Forward

AACSB and Entrepreneurship: How An Accreditation Association is Paving a New Path Forward

AACSB and Entrepreneurship: How An Accreditation Association is Paving a New Path Forward

By: Ayman El Tarabishy, President & CEO, ICSB

Leonardo da Vinci once famously wrote, “To develop a complete mind: Study the science of art; study the art of science. Learn how to see. Realize that everything connects to everything else.” The polymath innovator was able to see in the 16th century what many in the 21st are just now learning: nothing in this world exists in a vacuum. We are all a part of a larger community with a duty to lean on each other in times of need. Where one of us fails, we all fail. Where one of us succeeds, we all succeed. If we want to drive forward progress, we have to all work together towards a common goal.

 

 

It is precisely this concept of a common goal and the interconnectedness of everything that led the Association to Advance Collegiate Schools of Business (AACSB) to rethink, reinvent, and redesign their Business Accreditation Standards in 2020. Inspired by the motto to be a force for good in society, the team at AACSB––led by president and CEO Caryn Beck-Dudley––pulled inspiration from the world around them through this process. Amidst the coronavirus pandemic that turned the world as we knew it into something blurred and distorted, there was ample opportunity to construct new standards that would create a more precise, stronger future filled with a new generation of leaders encouraged to be the change they wish to see in the world.

 

 

At the 7th Annual California Entrepreneur Educators Conference (CEEC), Beck-Dudley opened the conference on da Vinci’s birthday with a keynote address that laid out exactly how the new standards were devised, signifying a change in how business schools would move into the future. Thinking about everything on a global scale, AACSB has accepted the responsibility of preparing the next generation of leaders to help societies grow around the globe. Whereas the old standards emphasized “hard” skills, including learning theory behind business practices, analyzing case studies, and researching data, the new standards are principles-based and outcomes-focused. In other words, they have been led by the concept of being proactive rather than reactive, finding upstream solutions to address a problem at its source, and pivoting to where a situation warrants through agility.

 

 

Keeping in the spirit of lifelong learning, AACSB redesigned the guidelines to let each business school shine in the light of their mission, visions, and values. Beck-Dudley emphasized that they needed to change the perception that the former standards were highly prescriptive. The team tackled this challenge by creating guidelines that empower entrepreneurship educators to have maximum impact on the greater good of society through creative means unique to their available resources. While deviations from the AACSB standards were discouraged in the past, that is not the case anymore. Today, ingenuity and agility are highly encouraged. Essentially, by leading with new guidelines, as opposed to strict standards, the schools have more room for creativity, innovation, and a pioneering spirit in hopes that new generations of entrepreneurs can feel supported as they learn through experience and not through theory alone. With these new standards, business schools will have more creative freedom within their programs, act with integrity based on guidelines rather than strict rules, and see the potential in and encourage entrepreneurial thinking that could change the world.

 

 

In addition to sharing the updated guidelines in her keynote, Beck-Dudley emphasized two significant behavioral changes needed for how the universities and their faculty operate. First, tying into the concept of everything in the world is inextricably linked. Business schools need to partner with other departments to solve the issues that lie before them. Suppose everyone stays solely in their respective lanes and forgets to communicate with one another. In that case, we will miss out on the essential collaboration and idea-generating results from considering a wide array of perspectives. Not only is it imperative that we share resources and ideas, but we also need to share our failures so that we can all learn from our mistakes, Beck-Dudley noted.

 

 

Furthermore, Beck-Dudley highlighted the importance of the older generations being open to change, as well. She discussed how the younger scholars in entrepreneurship are open to innovation and creative solutions. Still, it can sometimes be difficult for more established professors and researchers to do the same. In her own life, Beck-Dudley had to confront how she was resistant to change, as well. Hence, she empathizes with the reticence even while serving as proof that you can be an expert in your field and not only be open to new ways of thinking but eventually pave the way forward for future generations.

 

 

In many ways, the new AACSB Business Accreditation Standards embody the spirit of all that Humane Entrepreneurship represents. By seeing the new generation of business students and future entrepreneurs as whole human beings, by leading with empathy and other “soft” skills, we can change the way the world operates by focusing on the community as a whole. To complement this, Beck-Dudley shared feedback from test schools that first received the new standards. By being caring and genuine, with the best intentions in mind, the schools felt supported and optimistic about their futures, not to mention energized to find solutions to the challenges they faced.

 

 

By seeing the value in the entire business program, made up of unique and multifaceted beings with enormous potential, AACSB has demonstrated how important it is to give entrepreneurs the skills they need to flourish and not act as yet another limitation greatness that is human innovation. Meanwhile, the pandemic has proven that everything is connected, more than we ever thought possible before. We need to honor that and move into the future together, developing our business schools and our newest entrepreneurs and leaders accordingly. 

 

 

After all, Beck-Dudley posed the question in her keynote address, “If we’re not making a positive impact, what are we doing with our time?”

Certificate Program for Educators

Certificate Program for Educators

Certificate Program for Educators

Monday, April 26, 2021

 

Certificate Program for Educators

We are excited to launch our new certificate program- dedicated specifically for educators. The main goal of the program is to help educators – like yourself – to successfully teach the Market Opportunity Navigator and apply it in various educational settings: from accredited courses to practitioners’ bootcamps, for students, entrepreneurs, and business managers.

Learn directly from the tool’s creators:

  • Master the Market Opportunity Navigator – through real, hands-on practice
  • Design a well structured curriculum- for classroom teaching and practical workshops
  • Get acquainted with all our ready-made teaching materials- so implementation becomes easy
  • Join a lively community of like-minded educators

Who is this for?

  • Educators in entrepreneurship, innovation, marketing and strategic management courses
  • Program managers in accelerators and entrepreneurship centers
  • Trainers of innovation managers in larger organization

Signup today

  • The four interactive sessions will run online from May 4th- May 25, 2021
  • The program is limited to 20 participants

Click here to learn more and register:
https://wheretoplay.co/certificate-for-educators/

We look forward to seeing you in this program and helping you succeed with your teaching.

Cheers,

Dr Sharon Tal and Prof Marc Gruber
Co-creators of the Market Opportunity Navigator
Co-authors of the book “Where to Play”
www.wheretoplay.co

The Crucial Elements of the Financial Decision-Making Process

The Crucial Elements of the Financial Decision-Making Process

The Crucial Elements of the Financial Decision-Making Process

Thursday, April 22, 2021, by Mariya Yesseleva-Pionka

 

The reality is that every business venture can, at some point, be exposed to financial instability.  In the case of MSMEs, lack of sufficient and timely access to finance is typically a leading reason for business failures. The consequences of becoming illiquid can have a detrimental effect on business operations, forcing them to declare insolvency. MSMEs are more susceptible to broader economic conditions, thus, smaller enterprises’ survival rates are low compared to larger entities as MSMEs generally do not have the long-term capacity to withstand economic downturns. The increasing numbers of MSMEs exits and failures exacerbated by the COVID-19 worldwide pandemic emphasise the importance of understanding the reasons that could lead to this extreme outcome.

 

Recognising how to manage and deal with unforeseen financial events is essential for every owner-manager. The crucial elements of the financial decision-making process include (1) financial decisions – choice between equity or debt funds and associated costs; (2) investment decisions – choice of purchasing long term assets and (3) operating decisions to either reinvest profits back into a business and/or distribute profits back to the owners. In general, there are five fundamental principles to starting a new business: (1) evaluate your current financial conditions; (2) state your financial goals; (3) develop an action plan to achieve your goals; (4) implement your financial goals for your business, and (5) monitor and control the progress and introduce changes where necessary.

 

It is vital to plan for your business’s financial success and, when making decisions, always assess costs versus benefits and implied risks. Financial information has a significant impact on many business decisions. Financial statements report on the past, which is not necessarily going to indicate future prospects with 100% accuracy, but it can be very important in examining and evaluating your past financial decisions. In order to perform the financial statement analysis, every owner-manager needs to investigate past and current financial information of the business, industry benchmarks and competitors’ key financial indicators. The key financial ratios allow you to analyse the solvency of the business, liquidity of the business, the profitability of the business, ability to service short- and long-term debts, among others.

 

Your business’s success depends on many factors, and the economic environment in which your business operates creates the path for the future direction. At times of economic growth, there is an increase in business activity which is supported by strong consumer spending. During recessions, economy contracts and consumers tend to stay on the safe side and become very cautious with their spending plans. Economic indicators such as unemployment rate, inflation rate, gross domestic product (GDP), stock market index performance, exchange rates, government regulations and support suggest its future direction. Understanding and then applying in practice elementary economic indicators will help you think like an economist/financier when making financial decisions. The budgeting process allows the owner-manager to plan for the future and create strategic business plans in order to sustain business stability. This is the time for owner-managers to make sound business decisions related to revenue sources, spending, saving, investing, and, if necessary, pivoting towards new business ideas.

Author

Mariya Yesseleva-Pionka

Mariya Yesseleva-Pionka

Global Certificates Manager for the International Council for Small Business (ICSB).

Dr. Mariya Yesseleva-Pionka, PhD, serves as the Global Certificates Manager for the International Council for Small Business (ICSB).

Dr Mariya Yesseleva-Pionka is Global Certificates Manager at ICSB, a Higher Degree by Research Supervisor at Excelsia College and Adjunct Academic at the University of Technology  Sydney, Australia. Dr Yesseleva-Pionka held teaching and senior academic management positions in Central Asia (Kazakhstan) and Australia. She specialised in general investments, personal and corporate superannuation investments while working for Westpac Banking Corporation and BT Financial Group in Australia. She was invited to join The Housing Connection, a not-for-profit organisation in Sydney, Australia as Treasurer and Board Member from November 2019. Her research interests include entrepreneurial finance, traditional and alternative ways to finance small and medium enterprises (SMEs), corporate finance, policies for the small business sector, innovation and SMEs, FinTechs and Blockchain. Dr Yesseleva-Pionka is the Associate Editor for the Journal of the International Council for Small Business (JICSB). 

Re-imagine Series: Imagine all the People Livin’ Life in Peace

Re-imagine Series: Imagine all the People Livin’ Life in Peace

Re-imagine Series: Imagine all the People Livin’ Life in Peace

Monday, March 29, 2021, by Ruth Dwyer

 

COVID-19 has turned the world upside down with devastating effects that will continue for years to come.  However, it is essential to take a moment and remember that this is not the first challenge the world has faced, and, despite wars, famines, and plagues, humanity has made great strides to improve the quality of life across the globe. We will recover and rebuild—that is certain, but towards what? What can you envision as the best possible world?

At this moment, I would like to dream about what is possible in a world motivated by hope and optimism. Many of the topics will align with the United Nation’s Sustainable Development Goals, yet I would also like to look further into the future toward how we might conceive of an indeed just world. I would also like to engage in cross-pollinating ideas and practical next steps for the average person, business owner, and educator. Since every big plan is made of multiple actions, everyone is needed. That is why I ask that you all please join me as we explore what the world could resemble and how we can actualize this exploration.

Each month, I propose a subject and hypothesis and my journey to engage with said topic.

This week the subject is scarcity. Maslow notes that the most basic human needs are physiological needs for food, shelter, warmth, and rest.   What would a world where everyone’s basic needs are met look like? As the world undergoes a demographic transition, how can technological improvements impact people’s lives?  Furthermore, what societal changes can we personally influence?

Problem: Scarcity

Change Hypotheses:

Energy production and systems will become clean(er), relatively inexpensive, and widely available.

Recycled plastics and 3D printers will be relatively inexpensive and widely available.

Dream:

Everyone will have shelter and basic needs met.

The value will be placed on each person’s unique individual contribution.

Challenge Questions:

Start at home: What is your unique combination of gifts?  Are you fully utilizing them?  How about those closest to you? What are their gifts? What do they need to develop further?

Think local: How does your business, job, or position meet a community need? Are there ways it can be modified to fit more or different needs? Do you see a condition that is not being met at all? Who are the people with the greatest need?

Go Global: How do you interact with the broader world?  Do you have the impact you want?

My response to the challenge:

As a pediatrician, I have encouraged people’s abilities and dreams for the past 20 years.  While immensely satisfying, I still heard the small whisper that knew I was not using all my gifts. I longed (and even longer) for a time when all people can make a living sharing their unique talents. So, in the Fall of 2019, I enrolled in the online MBA program at George Washington University, and I am now pursuing an interest in social entrepreneurism with an international twist. Micro, small, medium-sized enterprises are a cornerstone of this worldview. How better to seek a better world than through the expression, development, and sharing of one’s gifts?

I am still searching for how to generate more global impact. Through the internet, I have met people in more places than I could ever visit, and my dream for the world has become more expansive. This project, “Re-Imagine,” and the ICSB Womenpreneur “WE” program  (July 11-16, 2021 in Paris) are part of this journey.

The world has big problems, and everyone is needed to re-imagine solutions that meet these problems’ needs. We can’t move forward if we do not understand what the future looks like. Please help by sharing this post and engaging below.

I look forward to our conversation,

Ruth Dwyer, MD, FAAP

Author

Ruth Dwyer

Ruth Dwyer

Senior Project Manager

Dr. Ruth Dwyer. MD,  serves as the Senior Project Manager for the International Council for Small Business (ICSB).

Pivoting pediatrician interested in social entrepreneurship, small businesses, and the SDGs. Ruth has worked on numerous medical startups. She enjoys painting, playing games, shooting hoops, and time with my family.

La sustentabilidad en las Pequeñas y Medianas Empresas (PYME)

La sustentabilidad en las Pequeñas y Medianas Empresas (PYME)

La sustentabilidad en las Pequeñas y Medianas Empresas (PYME)

Monday, March 29, 2021, by Dr. Francisco Navarrete-Báez

Parte fundamental de todo emprendedor, y su interés de crear una nueva empresa, en lugar de emplearse en una ya existente, es que todos los recursos invertidos en este StartUp se vean capitalizados por muchos años. De hecho, no se piensa en que esta aventura algún día terminará con el cierre de la empresa, al contrario, se imagina hacia futuras generaciones.

Recursos como el tiempo, al invertirle muchas horas desde su idea, conceptualización, escenificación, y sobre todo la puesta en marcha. Dinero invertido, que, al principio, sale de los propios ahorros personales con el riesgo y el sacrificio que esto implica. Y el esfuerzo de combinar esta tarea de iniciar un nuevo negocio y tratar de acoplarlo con el trabajo actual y los intereses personales y familiares.

Bajo este principio, es lo que denominamos la creación de una empresa sostenible. Es decir, que su vida se extienda por un largo periodo. Entendiendo que sostenible y sustentable son anglicismos que el español ha adaptado a estos nuevos términos que se han pronunciado a partir de este siglo XXI.  En lo particular a mí me gusta más el termino en francés que lo denomina: développement durable, que se aproxima más a lo aquí explicado, es decir, un desarrollo durable por un tiempo indeterminado.

Pero para entender lo que realmente implica el desarrollo de la sustentabilidad de la empresa, será necesario implementar, adoptar y monitorear una serie de prácticas que coadyuvarán a su logro continuo.

La mayoría de estas prácticas de inicio, se centran en el aspecto económico, enfocado principalmente en los ingresos obtenidos por las ventas de sus bienes o servicios que ofrecen al mercado. Esta siempre ha sido una visión reduccionista que solo conducirán, tarde o temprano, al fracaso de este emprendimiento. Ya que no hay visión a otra de serie prácticas indispensables para alcanzarlo.

Basado en el principio de la conceptualización del Desarrollo Sostenible, en donde nos muestra los tres pilares básicos para poderlo mantener: social, ambiental y económico. De igual manera, estos principios universales de sostenibilidad deben aplicarse al de las buenas prácticas de una empresa, especialmente a las pequeñas y medianas que por su naturaleza son más vulnerables al no contar con todos los recursos necesarios para su sobrevivencia.

Es así que la nueva PYME, o bien aquella que se quiere replantear estos principios, deberá observar dentro de sus prácticas el aspecto social, es decir, el trabajo hecho hacia la parte social interior y exterior de la empresa, como son las relaciones con sus empleados, sus políticas laborales, así como la relación con sus grupos de interés externos, como son proveedores, clientes, competencia y comunidad.

La parte ambiental, con una serie de prácticas orientadas hacia la conservación de los recursos naturales que lo involucran. Y la parte económica, que no solo consiste en las ventas, sino el compromiso a la investigación y desarrollo y la orientación emprendedora.

Por último, es importante recordar que estos principios son dinámicos, es decir, que todos los días hay que aplicarlos y buscar nuevos horizontes en donde impactar.

Autor

Dr. Francisco Navarrete-Báez

Dr. Francisco Navarrete-Báez

Profesor Investigador Universidad del Valle de Atemajac (UNIVA)

Guadalajara, México

El ABC del Emprendimiento en Pandemia: evidencias desde La Araucanía, Chile

El ABC del Emprendimiento en Pandemia: evidencias desde La Araucanía, Chile

El ABC del Emprendimiento en Pandemia: evidencias desde La Araucanía, Chile

Wednesday, March 24, 2021, by Ieva Žebrytė

A continuación, en el formato de las nubes de palabras interpretativas, se presentan hallazgos desde los datos cualitativos de las respuestas abiertas de las encuestas GEM NES (a expert@s) aplicadas *, respectivamente en junio-agosto del 2019, y junio-agosto de 2020.

Antecedentes

El GEM es un estudio social ya que se considera que las personas son principales agentes del ecosistema regional de emprendimiento. Este se define como el conjunto de actores públicos y privados que creen y se relacionan entre sí en base de las instituciones formales e informales (normas, reglas de comportamiento), asimismo se refiere al espacio-tiempo organizacional en el cual los miembros muestran la intención explícita de fomentar el emprendimiento. De este modo, la metodología del GEM se enfoca en las personas, organizaciones y el fenómeno emprendedor y basa su metodología en el uso de encuestas que son aplicadas tanto a emprendedores (de cualquier tipo) como a expertos en el tema y conocedoras/conocedores de la realidad regional.

 

Principales hallazgos GEM NES 2019-2020

En La Araucanía, de 400 respuestas del nivel regional (GEM NES) validadas, 121 respaldan la posición del PNUD de la ONU sobre la resiliencia de los sistemas, en específico se refuerza la idea que la diversidad (biológica y cultural) de los socioecosistemas (por ejemplo, el ecosistema de emprendimiento regional) es esencial para resiliencia de los sistemas y sub-sistemas. Si bien la diversidad, al crear redundancia hace nuestros sistemas de emprendimiento y negocios menos eficientes, de igual modo aumenta la resiliencia (UNDP, 2020, p. 9), es decir la capacidad de anticipar los estresores exógenos, absorber sus impactos y adaptarse a las condiciones de desastres y crisis, para recuperar e incluso mejorar la actividad comercial de sus emprendimientos.

En segundo lugar, y en estrecha relación con lo mencionado anteriormente, se encuentra la relación entre datos, información, conocimiento y sabiduría (Kitchin, 2014, en Žebrytė et al., 2019), y rol de estos en la toma de decisiones por parte de las y los emprendedores y gestores de las MiPyMEs. Las y los expertos muestran la preocupación por la educación en general y emprendimiento en particular. Desde total de 400 respuestas 84 se referían a obstáculos, incentivos o recomendaciones directamente relacionadas con educación y formación ligada al emprendimiento. Igual que WEF reconocen que las y los profesionales de la región se encuentran preparados para el mercado laboral (WEF, 2020 a, p. 22), pero destacan falta de preparación para emprender o crear valor independientemente, desempeñarse en roles de liderazgo, ser personas desarrolladas integralmente; y por ello sugieren introducir ajustes a los procesos de enseñanza-aprendizaje desde el nivel de educación segundaria. Finalmente, reconocen que la diversidad e inclusión serian motores para lograr un ecosistema regional de emprendimiento más competitivo, incluso a nivel global, y robusto por las relaciones interculturales más profundas y de mutuo beneficio.

En tercer lugar, junto con lo anterior, se considera que desde el gobierno central y los medios de comunicación nacionales comparten información sesgada sobre la región, especialmente en cuanto los temas de relaciones interculturales, discriminación e inequidad estructural e histórica, y seguridad. Tal guerra de información crea imagen desfavorable del ecosistema regional de emprendimiento, e inhibe su desarrollo.

Desde los datos recopilados en 2019 y 2020, para 2021 y mediano plazo hemos aprendido que nuestro ecosistema regional de emprendimiento se encuentra simultáneamente débil y fuerte en cuanto la diversidad, equidad e inclusión, y que para la construcción del ecosistema resiliente se requiere incidir en el desarrollo sostenible a través del Emprendimiento Regional que se rige por los valores de diversidad, equidad e inclusión.

La Araucania cierra 2020 dando realce a diversidad, equidad e inclusión como valores para el funcionamiento del ecosistema regional de emprendimiento (datos GEM NES 2019 y 2020):

ABC del emprendimiento regional Comprensión de los conceptos en 2020
(encuesta GEM NES aplicada en junio-agosto de 2020, en plena Pandemia de la COVID19 y después del Estallido Social, pero con plebiscito pendiente)
Detalle y contraste con 2019
(encuesta GEM NES aplicada en junio-agosto de 2019, es decir antes del Estallido Social)
Asociatividad Reactivación de la economía, sector público brinda servicios profesionales y apoyo a emprendedores a cero costo, implementos y protocolos de higiene y salud. Encadenamiento, colaboración publico privada, solidaridad con Pueblo Mapuche en su lucha contra discriminación y criminalización.
Beneficio Impacto ambiental, económico y social positivo. Interés colectivo o público por sobre interés privado inmediato (tendencia hacia la sostenibilidad). Emprendimiento como solución para los problemas de acceso al bien estar en igualdad de condiciones.
Creatividad Creatividad en ciber espacios, Araucania Digital, creatividad desde cosmovisión de pueblos originarios. Nuevos e innovativos modelos de negocios. Industrias creativas (artes, diseño etc.), Smart City, creatividad en los souvenir y otros ítem “tangibles” que acompañan servicios de turismo, por ejemplo.
Descentralización Condiciones de vida en regiones que previenen expulsión del capital humano. Políticas públicas para el fomento de emprendimiento locales y regionales.
Educación Formar personas integrales y multifacéticas, con habilidades blandas y que se sienten bien tanto en roles de liderazgo y toma de decisiones, como empleados dependientes. Educación inclusiva se entiende por intercultural y dirigida a lograr la equidad de género.
Financiamiento Mayor énfasis en subsidios y recurso público para enfrentar a la pandemia o la llamada reactivación. Nuevamente se destaca la necesidad de los programas regionales para fomento de emprendimiento regional y dirigido a financiar “capital humano con pertinencia regional” (retención). Énfasis igual en el financiamiento público y privado con enfoque regional (flexibilidad acorde las necesidades regionales, tributación diferenciada para emprendimiento naciente versus establecido etc.).
Globalización Enfrentar la globalización desde las fortalezas de una regional plurinacional, a través de la digitalización del emprendimiento y MiPyMEs, y servicios públicos. Enfrentar la globalización desde las fortalezas locales/regionales, es decir la diversidad e inclusión entendidas como convivencia dirigida al bien estar de la sociedad plurinacional.

 

Figura 1. Nubes de Palabras sobre los factores que obstaculizan
el emprendimiento en la Región de La Araucanía, 2019 y 2020.

Como se aprecia en la figura 1, en ambos años la palabra más repetida como factor que obstaculiza el emprendimiento en la región de La Araucanía es “Falta”, seguido de “Acceso” y “Financiamiento”. Lo anterior, está en línea con la tendencia de la dimensión Apoyo Financiero como la peor evaluada a nivel nacional en ediciones anteriores del GEM (e.g. GEM regiones chilenas 2018 publicado en 2019).

Para el año 2020, los conceptos que dejaron de aparecer fueron los tres relacionados al sector público (“Públicos”, “Públicas” y “Público”), en cambio, aparece el concepto “Gobierno”. De esto se desprende que responsabilidad se traspasó de la administración pública a las autoridades de turno. Este cambio se puede atribuir al descontento de la sociedad civil con la política chilena que se ha manifestado desde octubre 2019. No obstante, hay que resaltar que el tamaño de “Gobierno” es menor que el conjunto de las variables de “Público”, por lo que el aporte del sector público al emprendimiento en la región ha ido aumentando.

“Educación” y “Conocimientos” son dos conceptos que dejan de aparecer para el 2020, y están asociados a la dimensión Educación para el Emprendimiento, una de las peor evaluadas a nivel nacional, pero que en el tiempo ha tenido leves mejorías. Otros conceptos que han dejado de aparecer, y por ende se desprende son ámbitos en los que se ha mejorado a nivel regional, son “Cultura” e “Innovación”.

Así como ha habido mejoras en algunos aspectos, hay otros que han surgido para el año 2020. De estos destacan: “Mapuche”, haciendo referencia a que emprendimientos de origen Mapuche tienen más dificultades o menos apoyo para surgir demás de constituir una oportunidad para fortalecer el sistema de emprendimiento regional; y “Capital” incrementó su tamaño y surgió el término “Humano”, haciéndose alusión a la fuga de capital humano que hay en la región y los pocos esfuerzos por retenerlo.

Los conceptos sin variación en su frecuencia fueron “Burocracia”, “Crédito” y “Privado”. En contexto de pandemia se podría esperar que existan mayores esfuerzos para disminuir el efecto negativo de estos factores, para reactivar la economía o acelerar procesos evitando aglomeraciones, pero la evidencia demuestra que no han tenido cambios sustanciales para dejar de considerarlos obstáculos para el emprendimiento.

Figura 2. Nubes de Palabras sobre los factores que impulsan
el emprendimiento en la Región de La Araucanía, 2019 y 2020.

Si bien el “Financiamiento” fue el mayor obstáculo identificado por los expertos en el 2019, también fue el mayor impulsor del emprendimiento, junto con “Apoyo” y “Fondos”. La valoración de los expertos es favorable respecto a la existencia de suficiente oferta de subvenciones públicas; y otras alternativas de financiamiento han cobrado mayor relevancia entre los últimos años, como acceso a capital propio y proveniente de inversionistas informales (GEM Chile 2019 / Guerrero y Serey, 2020). Para el año 2020, el concepto financiamiento desaparece, pero de los conceptos relacionados se mantiene sin variación “Fondos” y aparece “Subsidios”. La pandemia tuvo consecuencias económicas que escapan del control de los emprendedores, por lo que expertos valoran que organismos públicos y privados tengan iniciativas que amortigüen estos efectos en el estado de resultado de las MiPyMEs (emprendimientos nacientes y consolidados en el tiempo).

En el 2019, los otros conceptos más relevantes fueron “Fomento” y “Ecosistema”. El ecosistema emprendedor regional está cada vez más consolidado y colaborativo, manteniéndose en crecimiento y desarrollo. Para el 2020, sigue destacando “Fomento”, seguido de “Universidades”, reflejando una mayor valoración del rol de estas, como ente que potencia el emprendimiento y que traspasa conocimiento desde la academia al ecosistema emprendedor regional. Otro ente que aparece para el 2020, es “CORFO”, que cumple un rol relevante en la reactivación de las MiPyMEs en la situación de la Pandemia de la COVID-19.

Las medidas preventivas por parte del gobierno contra el coronavirus, como el cierre del comercio no esencial para evitar el traslado de personas y las aglomeraciones, obligó a las empresas a adaptarse al mundo digital e innovar para subsistir. En el año 2020 destacan los conceptos “Digital”, “Online” e “Innovación” como impulsores del emprendimiento, porque, aunque no estaba contemplado con anterioridad, la región si contaba con los recursos humanos y tecnológicos necesarios para la adaptación.

 

 

Figura 3. Nubes de Palabras sobre recomendaciones para la mejora del funcionamiento
del ecosistema regional de emprendimiento en La Araucanía, 2019 y 2020.

En ambos periodos los conceptos más mencionados son “Mejorar”, “Mayor”, “Acceso” y “Apoyo”. Se puede destacar que las recomendaciones están orientadas a mejorar factores existentes en la región, por tanto los esfuerzos se deben enfocar en perfeccionar lo que se tiene y no en generar nuevos instrumentos. Esto último implicaría una complejidad mayor, y posiblemente, un mayor desembolso en recursos financieros y tiempo.

Según datos del Observatorio Laboral de La Araucanía (2020 a) las MiPyMEs corresponden al 82.1% de las empresas de la región, concentrando el 48.2% de las ventas anuales y un 59.0% de trabajadores dependientes. A pesar de que la economía local esta invisibilizada, se espera que en momentos de crisis aportará la producción relevante en los territorios. Por ello, es necesario atraer “Inversión” a ellos, crear y fortalecer “Programas” y medidas de gobierno y privados en apoyo a las MiPyMEs, tener expectativas de crecimiento en nuevos “Mercados” nacionales e “Internacionales”.

En el 2019, los conceptos que siguen en relevancia fueron “Educación”, “Información” y “Desarrollo”, en cambio, para el 2020, siguen “Fomento”, “Inversión” e “Inversiones”. Es decir, las preocupaciones sobre las dimensiones de Educación y Transferencia I+D, a pesar de seguir siendo un área por mejorar, no resultan ser prioritarias sobre la situación actual.

Figura 4. Nube de Palabras respuestas a preguntas sobre el Estallido Social y Pandemia de la COVID-19.Fuente: Elaboración propia en base a respuestas del GEM NES La Araucanía 2020.

Los emprendimientos nacientes, en transición y consolidados, ósea MiPyMEs, en particular se han visto afectados ya que cuentan con menos recursos para enfrentar esta seguidilla de adversidades -primero el Estallido Social y, luego la Pandemia de la COVID-19-. Para poder afrontar la situación actual los agentes del ecosistema emprendedor, del sector público y privado, deberían realizar un trabajo asociativo y colaborativo para la reactivación, razón por la que aparecen conceptos como “Participación”, “Dialogo”, “Iniciativas”, “Capacitaciones”, “Talleres” y “Espacios”. Es la percepción de l@s expert@s, que estas instancias se deben fortalecer para lograr la reapertura de todos sectores económicos, considerándose protocolos de medidas de seguridad sanitaria que sean factibles de llevar a cabo por los emprendedores, y adaptación del ecosistema y las empresas a la “Nueva Normalidad” logrando diversificación, equidad e inclusión -elementos necesarios para prosperidad sostenible-.

Según Encuesta Mensual de Alojamiento Turístico (EMAT), en La Araucanía las llegadas disminuyeron un 94.2%, las pernoctaciones un 94.6% en julio 2020 respecto al mismo periodo año anterior (INE, 2020). Según datos del Observatorio Laboral Araucanía (2020 b) un 58% de las empresas reportan una reducción en las ventas o ingresos con respecto al mismo mes del 2019. Dentro de las principales dificultades, destaca la disminución de clientes (84%), junto a la cancelación de proyectos o servicios y la falta de liquidez (70%). Por lo anterior, no es de extrañar la frecuencia del concepto “Turismo” y “Negocios”.

Asimismo, la OCDE (2020) afirma que con las medidas de contención que se relajaron gradualmente desde julio, los indicadores a corto plazo sugieren que la actividad económica ha comenzado a recuperarse, en particular las ventas minoristas y la producción manufacturera, mientras que el turismo y la hostelería continúan siendo débiles.

Por último, hay que destacar que al igual que en todas las nubes de palabras anteriores, considerando ambos años, en esta también se repiten con alta relevancia los conceptos de “Acceso” y “Apoyo”. Lo que da a entender que existe acceso y apoyo en varias de las dimensiones evaluadas, pero no a un nivel suficiente para hacer crecer y fortalecer el ecosistema emprendedor y para preparar a los emprendedores ante desastres y crisis.

Haga clic aquí para más detalles

Referencias

Amorós, J.E., Guerrero, M. & Naranjo-Priego, E.E. (2020) COVID-19 Impacts on Entrepreneurship: Chile and Mexico. In Ionescu-Somers, A. & Tarnawa, A. (eds.) Diagnosing COVID-19 Impacts on Entrepreneurship Exploring policy remedies for recovery. GEM and Shopify.

Charmaz, K. (2014). Constructing grounded theory. Sage.

Guerrero, M., & Serey, T. (2020) Global Entrepreneurship Monitor. Reporte Nacional de Chile 2019. Universidad del Desarrollo, Santiago de Chile.

ICSB (2020) Global MSMEs report 2020. Washington D.C.

INE (2020). Encuesta Mensual de Alojamiento Turístico. Edición n° 262. Recuperado en www.ine.cl/docs/default-source/actividad-del-turismo/boletines/2020/bolet%C3%ADn-encuesta-mensual-de-alojamiento-tur%C3%ADstico-(emat)-julio-2020.pdf

Kim, P. H., Wennberg, K., & Croidieu, G. (2016). Untapped riches of meso-level applications in multilevel entrepreneurship mechanisms. Academy of Management Perspectives, 30(3), 273-291.

Observatorio Laboral Araucanía (2020 a). Impacto del COVID en la economía mundial y local. Recuperado en www.observatorioaraucania.cl/descargas/

Observatorio Laboral Araucanía (2020 b). Situación Empresas ante la crisis sanitaria. Recuperado en www.observatorioaraucania.cl/descargas/

OCDE (2020). Perspectivas económicas de la OCDE, volumen 2020, número 2. Recuperado en https://www.oecd-ilibrary.org/sites/39a88ab1-en/1/3/3/8/index.html?itemId=/content/publication/39a88ab1-en&_csp_=fd64cf2a9a06f738f45c7aeb5a6f5024&itemIGO=oecd&itemContentType=issue

OECD (2019), OECD SME and Entrepreneurship Outlook 2019, OECD Publishing, Paris, https://doi.org/10.1787/34907e9c-en.

Rheinhardt, A., Kreiner, G. E., Gioia, D. A., & Corley, K. G. (2018). Conducting and publishing rigorous qualitative research. Cassell C., Cunliffe AL, & Grandy G. The Sage Handbook of Qualitative Business and Management Research Methods. Sage.

UNDP (2020). Human Development Report 2020. The next frontier Human development and the Anthropocene. NY, USA.

World Economic Forum (2020 a) The Global Competitiveness Report. Switzerland.

World Economic Forum (2020 b) The Global Risks Report 2020. Insight Report 15th Edition. In partnership with Marsh & McLennan and Zurich Insurance Group. Switzerland.

 

Autora

Ieva Žebrytė

Ieva Žebrytė

Académica del Departamento de Administración y Economía, y Valentina Barahona Vidal

Ieva Žebrytė is an academic at the Faculty of Law and Business (FCJE) of the Universidad de La Frontera (UFRO), Chile, and a 5th year student of PhD in Management program at the ISM University of Management and Economics, Lithuania. She teaches on undergraduate and graduate levels, conducts research and is currently the Director for Outreach and Community Engagement of the FCJE-UFRO. Her research interests include: Entrepreneurship and Local Development, Social Entrepreneurship and Innovation, Business and Community Resilience. She has published in English and Spanish. Current focus is on the social dimension of entrepreneurship, and small business disruptions induced by disasters.

Financial Literacy for Entrepreneurs

Financial Literacy for Entrepreneurs

Financial Literacy for Entrepreneurs

Monday, March 22, 2021, by Mariya Yesseleva-Pionka

 

Micro, Small, and Medium Enterprises’ (MSMEs) role in the broader economic environment should not be underestimated. The results concerning employment, industry value-added, innovation, and the entrepreneurship culture provided by MSMEs are well-documented worldwide. It is crucial to emphasise that the entrepreneurs and owner-manager of every MSME need to identify, assess and implement fundamental financial decisions for their business. Typically, daily financial decision-making processes in a smaller enterprise are done by owner-managers. Lack of time, resources, and expertise regarding legislative, tax, and financing requirements could hamper their external funding access.

Access to funding is fundamental for every business. MSME owner-managers who are better equipped with knowledge and understanding of external financing options do have an advantage. Every owner-manager needs to identify the mix of debt and equity financing that leads to the lower cost of funding for business operations, with the ultimate goal of maximising the business’s overall value. The future of MSMEs’ funding is based on rapid developments in technology. Entrepreneurs need to take on board the importance of financial and non-financial data, which investors and lenders increasingly use for assessing business-specific risk and overall exposure to the market risk.

Thus, financial, tax, accounting, and business digital footprints data give access to more in-depth information to work with when analyzing MSMEs’ risk exposures. Therefore, owner-managers who are better equipped with knowledge and understanding of investors’ financial arrangements, traditional banks, and alternative finance providers such as FinTechs, NeoBanks, and BigTechs, will have an advantage. Younger generations of future entrepreneurs, who are attending primary and high schools, need to be introduced to basic financial literacy and tax education, making them better prepared to make well-informed and effective decisions when starting their business. This is especially important when the younger generation is exposed to new employment and business opportunities in the so-called “sharing economy,” with numerous online platforms, financial products, and services. This necessitates entrepreneurs to comprehend elementary/basic financial/economic terms, assessable income, tax implications, and minimize their chances of being the victims of tax and financial hoaxes and frauds.

Close collaboration between higher education, K-12, and MSMEs could access the latest ground-breaking research studies, which could potentially prop up owner-managers financial literacy, business growth, and innovation. It could mean bringing new business ideas to life for start-up businesses, as any business venture’s success depends, to a large extent, on how owner-managers source and allocate funds. The K-12 and higher education sectors have to adapt to the ever-changing environment, primarily driven by rapid technological change, age demographics of students, and preferences for study modes. The labour force participation is expected to grow considerably, which means that people will have a career that lasts for 50-60 years. Further, many current job responsibilities will be fully automated in the future. As a result, the future workforce will require a different skill-set.

As a result, government policies worldwide should be aligned in promoting an economic environment in which MSME, higher education, and K-12 sectors foster improved collaboration and engagement in promoting the importance of the finance-structured discovery process and the overall financial literacy entrepreneurs, start-ups, and MSMEs.

Author

Mariya Yesseleva-Pionka

Mariya Yesseleva-Pionka

Senior Lecturer in Finance at the Australian National Institute of Management and Commerce

Dr. Mariya Yesseleva-Pionka, PhD, serves as the Global Certificates Manager for the International Council for Small Business (ICSB).

Dr Mariya Yesseleva-Pionka is a Senior Lecturer in Finance at the Australian National Institute of Management and Commerce. Dr Yesseleva-Pionka held teaching and senior academic management positions in Central Asia (Kazakhstan) and Australia. She won teaching awards at the University of Sydney Business School and Top Education Institute and was recognised as TOP 20 at the University of Technology Sydney (Business School). She specialised in general investments, personal and corporate superannuation investments while working for Westpac Banking Corporation and BT Financial Group in Australia. Dr Yesseleva-Pionka is Treasurer and Board Member of The Housing Connection, not-for-profit organisation in Sydney, Australia. Her research interests include entrepreneurial finance, traditional and alternative ways to finance small and medium enterprises (SMEs), corporate finance, policies for the small business sector, innovation and SMEs, FinTechs and Blockchain.