Know-How Fuels SME Growth Says Survey
Media release: 17 October 2003
KNOW-HOW FUELS SME GROWTH SAYS SURVEY
Owners of small and medium sized businesses are making more confident decisions and experiencing dramatic business growth, according to a survey carried out by business accelerator, The ICEHOUSE.
The ICEHOUSE surveyed 65% of the participants from its three-year old Owner Managers Programme (OMP) and found that the average growth in turnover for participants was more than double that against a benchmark of all NZ companies (24% compared to 11%).
The top 25% of OMP participants ratcheted this further, to a startling 34% growth in turnover and a 40% growth in net profit.
Andy Hamilton, CEO of The ICEHOUSE, says the research results showed the value of addressing what skills and resources are needed by owners and managers of SMEs.
"Feedback from business owners tells us there are distinct barriers to SME growth that are not being addressed effectively.
"There are the obvious ones, such as people, but almost as crucial is creating an environment which allows the owner manager to step back and analyse the business, identify its current position and find solutions to the issues that have the ability to create value or destroy an enterprise," he says.
All of the businesses surveyed said they had made some changes to their business as a result of attending the OMP programme. Around a fifth have increased their investment in fixed assets and 36% have changed the structure of their business in terms of staff and roles, restructuring to reflect product lines, distribution channels or key customers, or developing management roles for day to day operations.
Andy Hamilton says the courses are designed to enable owners managers to take the important step back from day to day business and work on, rather than 'in' the business.
"Over half of the participants we surveyed told us they have now developed their role into a more strategic one, focussing on areas of business development. And whilst a third said they had more personal time, another third said although they recognised the importance of personal time, they had not yet achieved it due to rate of business growth and change implementation."
NOTES TO EDITORS
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Carried out by telephone with 39 of the 62 participants of three OMP courses.
a.. All had made some level of change to their business as a direct result of OMP, with 49% reporting major changes.
b.. 51% said OMP gave them confidence to develop and pursue strategies, or confirm a course of action was correct. The same number also developed their own role into a more strategic one
c.. 21% have increased investment in fixed assets
d.. 31% said they have developed a longer term focus which has included planning the future direction of the company
e.. 56% have improved the definition of existing staff roles and delegated more responsibility.
f.. 36% are now focussing on high value customers
g.. 31% have broadened their customer base, including moving into, or expanding export markets
h.. 15% have changed the way they go to market
i.. 46% expanded their products and services in some way
j.. 51% felt the networking developed through OMP was a significant benefit.
Aimed at major equity shareholders running businesses with an annual turnover of $2Mill +
The programme is delivered in five 3-day block sessions over five months
Four separate programmes have been completed since it began in 2001, with the fifth now underway.
About the ICEHOUSE
The ICEHOUSE (The International Centre for Entrepreneurship) was established in 2001 by the University of Auckland Business School, alongside a number of industry partners. A Business Accelerator, it is focussed on creating greater numbers of successful international New Zealand companies through education, incubation, and research.