The power of Nuetrality

Certain times , being neutral can be very powerful experience both in business and family . In fact , India, as a country has learned it, very early, after it developed its independent foreign policy . Being a leader of Non-Align movement, it played a neutral role , and by that it, had a powerful experience as a country. Such success has to be replicated in the level of our small business also . Small and Medium Enterprises (SME) are right now the second largest employer after agriculture . It had a bigger role to play in the prosperity of the country .

That could be successfully handled when it plays a neutral role on resolving number of issues affecting the business community by and large , and starts an effective dialogue with stakeholders of civil society on issue related to environment and social development. Such dialogue would make the process of growth smooth for small business and bring the small business owners in a bigger role, of development of economy and simultaneously taking care of social and environmental issues.

Role of exit routes in small business agreement

Most of the deals which happens in small business are based on personal contact . So when terms or agreement are framed, often exit routes of the business deal is ignored . That is where , the business gets locked over a point of time and encounters a barrier of growth . The good agreement for business could be made, and break, at the same time . However , due to presence of personal contact , there is an extensive moral obligation, which plays a pivotal role on defining the agreement . That is why the agreement, could not be break and parties are locked for a infinite amount of time. This is definitely detrimental for both of the parties, and so exit routes should play a key role on all small business agreement.

The structure of a small business

Small business are normally loose in structural component . However , with the rise of structured finance in the early stage companies , reported by NKC study on 'Entrepreneurship in India', things are expected to be different . Most of the time , brininging in external finance is an automatic process on making things structured. As it is commonly perceived, that if you want the things to be organised, make the process digital, is also an timely advice. As the business grows infusing external funds and making some of the core process of organisation digital , is a easier route to make small business more structured.

Business Competition : The Change in Attitude

There is remarkable change in attitude, in Business Competition . Most of the key players in every segments have understood the importance of creating network of collaboration in order to successfully compete in the market . Often, after conquering the competitor through hostile acquisition , corporates re-instate their position in the market . Corporates have understood a great lesson on competition , that to successfully compete in market , you have to successfully collaborate first. It is the time for small business to understand this lessons and practice it in their business operations.

This is important , as while consulting in the small business sector, I have gathered this experience that most small business who are very hostile to their competitor and doesn't collaborate in the market while competing , stand as a looser at the end. There is need for change of attitude in the SMB sector in regards to competition.

The Entreprenuerial Adnormality

In our therapeutic culture, I'm sure some socialist and political leaders, hopes they can find the genetic abnormality that triggers entrepreneurship. They feel with that they can cure the conditions which triggers entrepreneurship.

That's the only guaranteed path to permanent power stability uninterrupted by innovation. Infact it is much easy to stay in power both in society and politics without the constructive intervention of entrepreneurs. It is often seen that they raise the bar for society and politics and move them to become more accountable for the actions towards the nation and the globe.

Recently , I was going through a article from rediff which shows how Vinod khosla takes his decisions on renewable energy ventures.

http://www.rediff.com/money/2008/jul/22slide1.htm

'Get busy' is the punch word of the smartest venture capitalist in the renewable space, who once dreamed to become an entrepreneur .

If our politicians could take decisions like that , on pressing environmental issues then half of the environmental problems of the world could get solved.

It's good for the world , to an extent, that our politicians and social leaders, does not find cure for the entrepreneurial abnormality in near future . Innovation could then play a role of great leveler between the 'have' and 'have not' in global society.

How to handle a powerful competitor? – Introspective questions for small business?

Handling a powerful competitor is always a challenge for small business. Recently with the retail revolution, many Mom-pop shops that run with the small business structure are facing the pain. Added, to it, is the crude inflation control mechanism by Y.V.Reddy, the RBI Governor. The hike for two times in CRR rate, in the single month of July’08, is going to have desperate effect in small business, as small business is a sector which borrows significant amount from banks to run their business. In this context, having proper competitive plan, for powerful competitors, is important.

Following are the introspective questions of handling powerful competitors

1. Understand the powerful Competitor strategy. Are they ambushing? Are they aggressive? Alternatively, are they playing defensive?
2. What kind of alliances they have? Are they trustworthy to the powerful competitor
3. Can networking efforts be build to these alliances?
4. Could there be any alliances with the powerful competitor itself which can protect both of the parties interest. Recently big retail outlets are arranging space for local Mom-pop shops on the ‘left out’ product categories


This introspection could help to build a basic competitive strategy to handle powerful competitor.

Succession Planning in Small business

Most small business has a little understanding about the concept of business of business. There is a huge passion with the team. However, to see the entire business in an abstract level, there is need of objectivity. The entrepreneur is always in ‘do it yourself’ mode. The lack of objectivity remains as a constant problem in small business. In addition, the business lacks momentum on the situation, when the entrepreneur losses focus or does not feel the passion like earlier. A succession planning is a very important advantage in all these cases. Succession planning helps to create second line of leaders. This is very helpful on that business situation where the entrepreneur is an expert on one particular area of business .Creating second line of leaders makes the business much more organized. This way, succession planning has a dual advantage. One way it strengthens the HR scenario of small business, by enriching the aspiration level of second level of leaders. On the other hand, it also expands the capability of the organization to have diverse competency.