Business mentor: Better skills vital to reach 4pc growth target

How are small business owners upskilling?

Ralph Penning, of the Independent Business Foundation, replies ...

There is general agreement that upskilling in business management competencies is essential to achieve the 4 per cent economic growth we aspire to in New Zealand.

Small to medium enterprises are getting increased Government attention as the most likely source of this increase.

But despite the extraordinary efforts put into this sector with inducements and business development programmes, there is disturbing evidence that the message is not hitting home.

The quarterly survey undertaken by Dr Stuart Locke on behalf of the Independent Business Foundation has revealed that SMEs are failing dismally to improve their skills.

With 66 per cent not involved in any form of training, the 7.9 per cent who say they acquire knowledge informally is too insignificant to make any difference.

Read in conjunction with the findings of another survey by the foundation, there are clear indications of a reluctance to use the formal group format of skills training in favour of one-on-one mentoring.

Closer investigation reveals that most SME owners/managers, apart from being reluctant to reveal their problems and shortcomings in seminars and workshops involving competitors and peers, feel more confident working with a role model who has relevant business experience.

This may account for the growth in mentoring, and lately in business coaching, as the preferred source of business advice.

Interestingly, chartered accountants are by far still the preferred source of professional assistance. However, they are used too sparingly, due to cost considerations, to make a major contribution to business development.

In an ideal situation, business skills training should in the first instance be delivered in a group environment to take advantage of experience-based, shared learning.

A good presenter will abstain from too much chalk and talk and assume the role of facilitator to draw on the existing knowledge in the class.

The challenge arising from this method is to ensure that participants actually implement the newly gained knowledge.

A safe way to achieve instant application is direct follow-up by an experienced mentor.

The foundation believes that using the hands-on approach to break old, unproductive habits in favour of working smarter, not harder requires intermittent mentoring.

Combining the best aspects of Biz seminars and Business in the Community mentoring has the prospect of achieving the preferred outcome on which our economy depends.

Independent Business Foundation

* Send your Mentor questions to: Ellen_Read@nzherald.co.nz

Answers will be provided by Business in the Community's Business Mentor Programme.