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Ii a - cooney issues and policies in entrepreneurship skills development


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The upgrading of workforce skills is key to the competitiveness of SMEs. In today’s business environment there is a premium on innovation that enables firms to develop new products and services, new production processes and new business models. This requires both in-house innovation and the ability to absorb knowledge from other firms and organisations, both of which call for a skilled labour force. Skills are also a critical but understated resource for entrepreneurship seen in the sense of business creation. Similarly to workforce skills, entrepreneurship skills will boost the competitiveness of local businesses thanks to the improved strategic and management competences of the entrepreneur.

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Ii a - cooney issues and policies in entrepreneurship skills development

  1. 1. Entrepreneurship Skills forGrowth-Orientated Businesses (part of an OECD Project) Thomas M. Cooney Dublin Institute of Technology
  2. 2. Entrepreneurship Skill-Sets Entrepreneurship Skills •Inner Discipline •Risk-seeking •Innovation •Change-orientation •Persistency •Visionary Technical Skills Management Skills •Specific Operation •Planning Technology •Formulating Goals •Communication •Decision-making •Interpersonal relations •Motivating •Organizational ability •Marketing •Coordinating Team members •Accounting •Environmental Observation •Negotiation
  3. 3. Barriers to Growth• Product / Service – Poor quality, not required by customers in large numbers• Funding – Lack of capital, poor cash flow• Psychological / Motivational Factors – Low levels of ambition, risk aversion, fear of loss of control• Managerial Deficiencies – Finance, management, marketing, operations, HR• Government Bureaucracy• Poor Economic / Market Conditions
  4. 4. Factors Influencing Growth in Small Firms (Storey, 1994)ENTREPRENEUR FIRM STRATEGYMotivation Age Workforce TrainingUnemployment Sector Management TrainingEducation Legal form External equityManagement experience Location TechnologyNumber of founders Size Market positioningPrior self-employment Ownership Market adjustmentsFamily history PlanningSocial marginality New productsFunctional skills Management recruitmentTraining State supportAge Customer concentrationPrior business failure CompetitionPrior sector experience Information and advicePrior firm size experience ExportingGender
  5. 5. Market Strategies• Choice of Market• Customer Driven• Wide Product Range• Constantly Innovate• Differentiation/Focus• Highest Quality• Exporting• Higher Retained Profits
  6. 6. Key Attributes That Differentiate Fast-Growth from Non-Fast Growth Firms (Barringer, 2005)
  7. 7. Policies That Support Business Growth• EU – Enterprise Growth Programme – EuroStars – Harmony – Programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME) will run from 2014 to 2020, with a planned budget of €2.5bn• Country Initiatives – Denmark (the former Gazelle Growth Programme and the current Accelerace), – Finland (TEKES funding for growth oriented SMEs, Finnish Growth Company Service, Vigo) – Norway (Incubator Grant, Seed capital scheme, Nyvekst) – Estonia (Estonian Development Fund) – France (Gazelles Programme, France Gazelles fund) – Ireland (High Tech Startup programme), – Netherlands (Growth Accelerator “Groeiversneller”) – Spain (Neotec Fund)
  8. 8. Good Practice - Finland (Vigo Accelerators)• Accelerators (mentors) offer their proven business expertise, funding, and extensive contact networks to the target companies• Accelerators invest both money and time into the target companies and take on both a strategic and an operative role in the companies• Accelerators have been selected from the best applicants in their respective fields in a public procurement process• Give incentives to the best business developers in order to help the most promising start-ups grow into successful companies• Ensure early stage funding for start-ups, increase their shareholder value, and make the start-ups attractive targets for venture investors• Continue to raise significant venture capital investments after the acceleration stage to support expansion of the target companies.• Invigorate the Finnish venture capital market and bring more international acceleration and venture capital players into Finland
  9. 9. Good Practice – South Korea
  10. 10. Difficulty with Policy Design• Lack of empirical evidence• Need for specific design• Possible government failure• Justification dilemma• Resource allocation dilemma with general SME policy• Quality limitations• Speed limitations• High growth co-occurs with high failure
  11. 11. Transformative Learning• Experiential and group situated• Time consuming• Aided by a predisposition or openness to change• Dependent on affective learning through critical reflection• Involves both educator and students as transformative learners.
  12. 12. Business Support and Training• Policies supporting high growth of SMEs are worthwhile• Seeking sustainable (high) growth• Policies for general SMEs and for high-growth SMEs may co- exist• Broader approach to support high-growth• No need to focus on specific industries• Create the right framework conditions• Specific roles of the European Commission• Enhance coaching opportunities• Improve access to growth finance• Improve internationalisation opportunities
  13. 13. Conclusions• Training – Customer-Orientated - Entrepreneurs must be committed to creating customer value through the provision of innovative products / services; – Strategic Development - Entrepreneurs should learn how to select from a number of market strategies that can influence their chances of success (e.g. Choice of Market, Customer Driven, Constantly Innovate, Differentiation/Focus, Highest Quality, Exporting); – Financial Management – Entrepreneurs must learn the skills required to access additional venture capital (e.g. how to structure a proposal); – Human Resource Management - Entrepreneurs need to understand and appreciate the need to enhance the HR practices of the firm and to offer financial incentives to employees (share the rewards).• Conditions – The entrepreneur must be motivated to grow the business; – Peer-to-peer mentoring from successful entrepreneurs is a critical element of any training programme (mentors must also be motivated to work in this role); – Entrepreneurs must be provided with increased access to networks, finance and international markets.