Tweet

5.3.5 Micro and small enterprises: Public sector training

Guest post by: International Labour Organization

Article Overview: Generalisations abound about the generally poor performance of public sector training institutions in supporting MSEs.

5.3.5 Micro and small enterprises: Public sector training

Generalisations abound about the generally poor performance of public sector training institutions in supporting MSEs. However it is clear that there has been very considerable diversity of experiences on the ground. For example, in a study of MSEs in five African countries in Steel and Riopelle conclude that in Tanzania, the Small Industry Development Organisation had been "comparatively successful at providing hands-on training and disseminating information" (Steel and Riopelle, 1995:33). In Ghana and Senegal, on the other hand, "scare resources" had limited the usefulness of government training efforts.

The received wisdom is that it is extremely difficult for most public sector organisations to develop programmes that can promote and develop entrepreneurship in an efficient and effective manner. Such interventions tend only to work well where there are organised entrepreneurship associations and business advisory bodies, small enterprises are 'relatively large', training is closely integrated into a wider programme of inputs and services, and trainees are well motivated for business success. "Many MSE programmes have offered only low level, scheduled generalised often standardised services. This approach seldom addresses the real needs of small and microenterprises. Characteristically, both new and existing enterprises want quick, short term, moderate to high levels, of specialised services that are tailored to their immediate needs" (Grierson and McKenzie, 1996:22).

The key principles of 'good practice' which have emerged from business development support projects for MSE also apply to the informal sector as a whole (see Box 10). Training approaches should "conform to the natural processes of skill acquisition" but most public sector training institutions "are bound by structures and methods derived from bureaucratic imperatives" (ibid). However, it is clear that the combination of major fiscal crises and market-driven VET reform has resulted in major changes to these structures and methods during the 1990s. In particular, with many parent ministries being increasingly unable to fund their own training institutions, these institutions have been granted, in varying degrees, more autonomy in order to commercialise their training activities and thereby generate their own sources of funding. But, without public resources, they will have no alternative but to reorient increasingly to the market rather than the poor.

EMPLOYMENT AND TRAINING
PAPERS
43
Learning to change: Skills
development among the
economically vulnerable and
socially excluded in
developing countries
Paul Bennell
Employment and Training Department
International Labour Office Geneva
First published 1999

Related Articles
  5.0 Micro Enterprises - What are they?: Entrepreneurship and Small Business Enterprise Growth in Uganda
  4.2.1 The challenges and barriers of growth: Support for Growth-oriented Women Entrepreneurs in Tanzania, 2005
  4.2 The profile of growth-oriented women: Support for Growth-oriented Women Entrepreneurs in Tanzania, 2005
  2.1.1 Poor outputs, limited impact
  3.1.2 Training for the formal sector: Training priorities, resources and reorientation

Article Tags: advisory bodies, african countries, business development support, business success, development organisation, fiscal crises, government training, grierson, imperatives, informal sector, mckenzie, natural processes, poor performance, public sector training, skill acquisition, specialised services, standardised, support projects, training institutions, vet reform



Related Forum Posts
Micro Loans - That's interesting Russell. The following is more information on Micro Loans and anyone within the USA who would like a list of Micro Loan Lenders (listed by State) I have that information! Just let me know and i'll get it out to you in my spare time. The Microloan Program provides very small loans to start-up, newly established, or growing small business concerns. Under this program, SBA makes funds available to nonprofit community based lenders (intermediaries) which, in turn, make loans to eligible borrowers in amounts up to a maximum of $35,000. The average loan size is about $13,000. Applications are submitted to the local intermediary and all credit decisions are made on the local level. Terms, Interest Rates, and Fees: The maximum term allowed for a microloan is six years. However, loan terms vary according to the size of the loan, the planned use of funds, the requirements of the intermediary lender, and the needs of the small business borrower. The maximum loan amount is $35,000, however, the average loan amount is around $13,000. Interest rates vary, depending upon the intermediary lender and costs to the intermediary from the U.S. Treasury. Generally these rates will be between 8 eight percent and thirteen percent. Collateral Each intermediary lender has its own lending and credit requirements. However, business owners contemplating application for a microloan should be aware that intermediaries will generally require some type of collateral, and the personal guarantee of the business owner. Technical Assistance Each intermediary is required to provide business based training and technical assistance to its microborrowers. Individuals and small businesses applying for microloan financing may be required to fulfill training and/or planning requirements before a loan application is considered. How to Apply: Small businesses that are interested in applying for a microloan should contact a microlender in their area.
Public Speaking and Presentations - Hi all, I am a local business women who does not travel...but would love to be a resource for anyone needing help or suggestions on speaking/presentations and just plain old communications on the platform and off...I've recently had some training by two former World Champs of Public Speaking...It was the best weekend of my career life. Annette
Nano technology - Is the future small? Have you heard about nanotechnology , what you feel prospects of business and developments with this sector which is a very rare opportunity to step in.
Training and Self Development - It's interesting to me that the latest StatsCan study shows that the majority of ongoing professional development training is paid for by large corporations. Yet, at the same time it is small business and entrepreneurs who need to invest in this exact training in order to remain competitive. So why is it that we are not taking ongoing professional development training? Is it time? Money? No perceived need? I'd appreciate it if you could take a second to answer the attached poll.
Training - Louis: Some regulated industries mandate that you attend training. However, even then, finding time to meet those requirements becomes an issue. This may explain the growth of tele-seminars. To answer your questions though, ROI is very important and everyone needs to sell or market no matter what they do. The best tip I ever got on training is not to pitch training as training b/c even big companies have limited budgets for training but training rebranded as "sales support." It makes the ROI argument that much more appealing. Hope that helps. Good luck.


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

What is Discretionary Cash Flow

Tips to Take Control of Credit Card Debt

Using Social Media Marketing

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.