family managed businesses, smes and start ups - opportunties tomorrow, responses today

8/7/2019 Family managed businesses, SMEs and start ups - opportunties tomorrow, responses today

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Family-owned enterprises, SMEs and Start-ups:

opportunities tomorrow, responses today.

Madhusudan Jhunjhunwala


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Genesis

Every enterprise - small, medium or large needs managerial capabilities in its phase

of growth. The need is the same for each one of these categories; but the ability to

afford is not. In a time, when demand for such scarce resources far outstrips the

supply, there is an opportunity to innovate management methods and practices so that

enterprises will have affordable and executable management solutions. This is

particularly true for the Small and Medium Enterprise (SME) segment of the

economy.

Apart from the economic indices that underline the critical dependence of global

economy on SMEs, they acquire special significance in an age marked by academic

entrepreneurialism and innovation. In a very immediate context, effectiveness of large

enterprises also depends on an effective and efficient SME sector when outsourcing

is the key to cost rationalization, innovation and productivity


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1. Objective of the Talk.

To reinforce a process thinking among those who have a stake in SMEs, start

ups and family-owned businesses. Based on my own understanding of the issues and responses in the last

two decades.

Minimum theories, maximum application.

2. Justification for the topic

Why this topic

Its relevance to the audience entrepreneurs, professionals, students andsociety

Need to foster entrepreneurship in the new generation

3. Setting the context

1. Use of data and information on SMEs (size, market, issues, etc.) only todevelop a proper context.

4. Opportunities tomorrow and challenges today: possible practical responses5. A few case studies and Jim Collins/Harish Mariwala/Ratan Tata

6. A story of change


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Objective of the presentation

To initiate a process of thinking among those who have a stake in family-ownedenterprises, SMEs and start-ups.

All three of them are primarily a mindset and have many features in common.

Earlier successes were situational, today we need to plan for them.

New breed of entrepreneurs and enterprises execution based on a detailedplanning. (Example: IT is an industry based on the hard work of old economy and

today the old economy has suffered for good people). Earlier entrepreneurs (pre-liberalization) were innovators - built productive

companies with out-dated technologies and second-hand plant and machineries.

Families have built businesses and organization. There are a few gaps which iffilled can set path for another phase of business leadership.

One industry of the past has given birth to many variants in the future.

SME manufacturing has been the bed of technological innovation globally. Start ups and aspiring entrepreneurs: out of ten steps required to build a business,

nine do not require money. Money is the tenth which automatically follows if thenine are done well. It may be simple but not easy.


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Setting the context

1. Key statistics on SMEs local and global

2. Experience during the internet search on SMEs

If SMEs growth, as shown in data and infrastructure, is good then

what is the problem

Almost all available literature talks about macro and data based

perspectives and innovation in general,

They all talk about possibilities and stop short of how to realize

them

SMEs innovation (pre-liberalization): old plant and machineriesgave impressive productivity


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Family-owned enterprises, SMEs and Start-ups: key

characteristics

Owner has the highest stake and hence decision making could be faster.

Organically grown and cohesive organizations (if not far-flung and multi-

location).

Effectiveness of control could be higher.

Easier to keep a watch on implementation.

Risk is lower.

In case of start-ups, it is a clean slate to write and apply experiences of past

and others.


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Family-owned enterprises, SMEs and start-ups: opportunities

tomorrow

1. SMEs can solve the so called talent problem of industry

2. Experiments and innovations in all fields of business

3. Unlock the hidden wealth of knowledge and experience in the company

rather than looking for solutions elsewhere

4. Market (domestic) can hardly be a problem.

5. Cost of quality@ 30% of sales mainly on account of rework and

rejections resulting from inadequacies in supervision, technical skills,

job knowledge, communication/reporting, role clarity, planning,

information about market, vendors and customers, business processes

6. Low productivity of people and assets

7. It is almost recession-proof.8. Rationale for outsourcing by large enterprises is low cost, higher

quality.

9. Future industries and technologies require robust organizations.


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Family-owned enterprises, SMEs and Start-ups: responses

today

Operational

Market

Financial

Skilled people Technology

Environmental

Regulatory

Business processes


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Family-owned enterprises, SMEs and Start-ups: responses

today

Realize and accept what you

control and what you dont.

Commitment and focus to

improve productivity of

people and assets the two

critical drivers of

profitability.

Transaction Monitoring Organization

s

performance

Y Y Good

Y X Acceptable

X Y Problems

X X On the verge

of collapse


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What Constitutes the SME Sector

It is rather difficult to define precisely as to what constitutes the SME sector,

as

It covers a wide spectrum of activities ranging from manufacturing to

trade to services.

It involves different types of organizations with varying constitutions like

proprietary concerns, partnership firms, private limited companies, public

limited companies.

Regulations/Govt. Policy guidelines varies from activity to activity.

It overlaps with the presently defined Priority Sector.


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In the given scenario, it can be broadly said that the SME segment would

include the following

Individuals

Individuals

as

Businessmen

Professionals

Partnership &

Family owned

Business

Small &

Medium

Sized

Companies

Larger

Corporate

Corporate

Giants/ PSUs

Retail

Segment

SME Segment

(Constitutionwise)

Wholesale /

Corporate

Segment

What Constitutes the SME Sector ..


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MNCs

Large enterprises(501-5000 crores,

10,000 people,

Multi location, but not

overseas

Medium and semi-large enterprises

(11-500 crores, 1000 people,

Multiple location, but not more than 2-3

Micro and small Enterprises

(0-10 crores, 200 people, single location)

Enterprise Segmentation


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The beginning of big things

SMEs contribute globally: 32% of global output

97% of all number of enterprises

70% of all manufacturing jobs

95% of SMEs employ fewer than 100

people


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SMEs a global picture

435098Korea

5270Japan

35407010 mn.India

3340

( 4 trillion)

25

(68 mn)

USA

327097Globally

% of

Exports

Output

(%of GDP)

% of mfg.

jobs

No. of units

(% of total)

Country


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SSI units : 12.3 million

Employment generated in SSIs : 29.5 million

Production : US $ 100 billion

Exports : US $ 27 billion

SSIs account Industrial Production : 40% Exports : 35% (50% of Direct & Indirect) GDP Share : 7%

Ownership pattern :

Proprietorships : 78% Partnerships : 16%

Corporate & Others : 6% Industrial Units : 96%

Service Enterprises : 3%

Ancillary Units : 1%

Indian SME Sector A Profile


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Macro- challenges faced by the SME Sector

(beyond control)

1. Non-availability of adequate capital for investment .

2. Difficulties in accessing the capital market.

3. Inadequate institutional framework for assistance.

4. Lack of opportunities to attract Foreign capital.

5. Lack of technological advancement/ updation.

6. Impact of / Threat posed by WTO.7. Terms dictated by the large Corporate on whom the SMEs depend.

8. Access to finance for SME Projects

9. Lack of adequate working capital

10. Quality industrial infrastructure (inclusive of Power)

11. Sickness and NPA management

12. Setting up common facilities.

13. Ineffective institutional support bureaucratic and slow response.

14. Missing interface with the academic institutions


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Major operational and infrastructural issues before SMEs

(within our control)

1. Lack of proper market knowledge both domestic and exports; heavy dependence on

existing customers; new customer development very slow and meagre.

2. Poor understanding of export market requirements and hence low exports.

3. Poor market and production planning systems leading to delivery failures.

4. High inventory levels leading to high cost of inventory and lower inventory turns.

5. Non-availability of skilled manpower and high manpower turnover.

6. Conventional / Old technologies.

7. Lack of systematic analysis of customer complaints including approvals

8. Low productivity of assets and people.

9. Problems in outsourcing

10. Delayed payments to SMEs

11. Difficulty in communication with customers, subcontractors, calibration, and testing labs.

12

. Present skill of their employees in ICT handling is inadequate.13. ICT facility to improve their communication system.

14. Performance planning, measurement and training.

15. Rework and rejects leading to very high cost of poor quality.

16. Technology up gradation and improvement in quality of products

17. Reluctance to change the way of functioning.


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SMEUp to Rs. 500 cr.Up to 1000 people

(A)

Excellent

Performance;Beating Industry

Standards

(B)

Moderate

Performance;At par with

industry average

(C)

Under-performing;

Below industryAverage; But

making profit

(D)Loss Making (E)Sick/BIFR (F)Start Ups

Categorization of SMEs


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Organization

A (strategic)Business eco-system issues.

Long-term health

Affect profitability

B (Tactical)Issues between business and eoo-system.

Medium-term impact

Supportive role to business

C (Operational)Internal to core business processes

Short-terms gains

Enterprise Mapping Analyzing SMEs challenges and opportunities

w.r.t. business and eco-system

1. Economic environment

2. Govt. policies

3. Industry bodies

4. Socio-economic factors

5. Economic infrastructure

6. Globalization7. WTO and GATT

8. Regional trade blocs

9. CSR

10. Technological changes

11. Bargaining power

1. Taxation2. Corporate governance3. Legal and statutory

4. CLB5. Sustainable development6. CSR7. IPR

8. Knowledge management9. R&D10. Certifications and approvals11. Audits and compliances12. IT infrastructure13. Technology upgradation

14. Innovation15. Policy framework

1. Marketing and business dev.2. Sales3. Branding

4. Code of conduct5. Operations

1. VCM & SCM2. Quality & Maintenance

3. Systems and process6. Finance and accounts7. Productivity

1. Asset/capital2. Human

8. CRM

9. New initiative1. TQM2. Lean

3. Six-sigma


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Enterprise

Profitability Profit

1. Long-term health2. Strategic3. Environmental factors4. Culture of the organization5. Code of conduct and value6. Skill and motivation

7. Sustainable development8. Sustainable productivity9. Poor compliance bigger liability10. Policies, systems, processes11. HR to be the key integrator12. Innovative management13. Action plan for growth:

1. Productivity of assets2. Productivity of people3. Improve compliance

4. Product innovation

5. Technology6. Market expansion7. Market penetration8. Value addition9. Higher realization

1. Short-term gains,2. Cutting corners3. Tactical4. Deferral of investments

1. People2. Technology

3. Productivity4. New initiatives5. Skill development6. Quality programs7. CRM8. Strategic initiatives9. Vendor improvement

5. Psyche of shortage and crisis6. Insensible cost cutting7. Manipulation

8. Non-compliance

9. Deviations from specifications10. Poor pays11. Poor vendor management12. Unplanned outsourcing


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A holistic approach to organization

Mission PeoplePolicies, systems,

Procedures anddocumentation

Business ModelAsset

Management

Vision

Empowerment,Learning,

Trust and care

Integration and

communicationBusiness Plan

Values and character

Credibility

Respect

ObjectiveGoal alignment and

leadership

Knowledge creation

management

ResourceOrganizationAnd

optimum utilization

Customers,Network,

Relations,

Human capital

Knowledge & learning

Innovation

Inspiration and passion

Role clarity,Accountability

And mutual respectSimplicity

Execution and

Result-orientation

Value Systems, ethics

and, character


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The stories of three organizations


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Organization A: A mid-sized company in power sector,

Period of change: 1999-2002 In 1999

A well respected 35 year old mid-sized Indian company (a JV between a US MNC andan Indian major) based in Pune in power sector.

Sales 200 crores, no. of employees 700, plants in Pune, Hyderabad, and Daman.

1998 onwards US MNC exits leaving the Indian operations to fend for itself.

During 35 years company neither grew as other domestic companies did, nor it got anymajor technology support/transfer from the US MNC (although the MNC had manyproprietary technologies).

The exit agreement was unfavorable to the Indian company which had little choice but toaccept the terms given to them.

The company was made to sign a non-compete agreement with the US major.

Business model heavily dependent on SEBs, development funding from Word Bank.Zero exports.

Post-Pokharan sanction, business likely to be hit to the tune of 50% loss of sales.

In operating losses for last 7 years and made profit only before 1991 in controlled andclosed Indian economy.

High manpower cost (25% of sales), low worker and managerial productivity, heavyoverheads, aggressive and militant CITU union, used to work only in cartels, no majorUSP or product to rely on.


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Company A: 1999-2002 (continued)

2002

Profitable operations.

Manpower cost @ 10%.

Market leader (domestic) in its product segment.

Sales nearly doubled.

Export of goods to many a countries including Europe.

Employees attitude undergoes a major positive shift.

50% of workers accept VRS and go away through peaceful negotiations.

Company once again becomes a part of a reputed MNC (Europe).


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Company B: 2003-2006

In 2003

A consumer durable company employing 800 people.

An entirely new set up in a village setting ( only an industrial shed and machines )

Poor access from the city, dysfunctional telecommunication and internet.

Available manpower either class X or below against ITI (as required).

Barely doing 10000 units of production per month.

High absenteeism and attrition.

Almost nil financial support due to fund crunch.

Harassment by tax authorities and local politicians.

The first and the only unit in that area for quite some time.

No vendor base and poor supply chain.

Quality and availability of water and power major issues.


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Company B: 2003-2006 (continued)

2006

Computer literacy at 80-90% (all employees including workers).

Unit had its own home-grown IT software (internally integrated ERP) though it didnt

have internet access and comfortable telecommunication facility

The young boys from village produced very high quality products at nearly of the

industry cost and double the productivity.

The unit became a benchmark in terms of productivity and cost within the 25 year old

group, a leader in its own business.

Employees (workers and officers) worked together to build the infrastructure such as

canteen, office, gardens, sheds for storage and internal roads and introduced many

innovations against all financial odds.

A team of20 fresh engineers (0-1 years) played a very critical role in My SAPimplementation in the group and have become thorough bred IT professionals. They have

all served the group for nearly 5-6 years before they went out for better opportunities.

They generated resources by using and selling scrap and designed and launched a few

radically improved products.


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Company C: 1954-2010

2008

A market leader in its line of business for the last 55 years.

4500 people, 175 branches/offices across country.

Several JVs in and outside India.

Strong R&D back.

Worried that competitor will overtake.

Had no clue as to what need to be done.

Had a vague idea that it is an HR issue but didnt know the specifics.

Managers felt that they are doing an extremely good job and there is little room for

improvement with them and, therefore, problem lie elsewhere.

Very motivated people dedicated to the company and been with it for not less than 15

years on an average.

The company knew its business and it was growing at 30%; yet they felt that the

competition will take over. And it was about to happen.


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Company C: 1954-2010 (continued)

2010

In 2008 the company starts an organzitionwide intervention at three levels top (VP andabove), middle (Regional manager to AVPs) and lower levels ( workers to managers).

Simplifies the vision statement (existed for 10 years but not understood due to

complexity),

Launches organization-wide communication, helps everybody understand it and decide

what each one of them have to do to make it a reality.

Precise roles are defined for everyone.

Performance measurement systems are introduced for business and individuals.

Simplicity is stressed in communication, processes and training.

All the available knowledge with people is institutionalized.

People admit that yes they need to change their mindsets and they do.

Organization has a path and a plan to salvage its levels of confidence and grow further.

It is working on it though it will take time to reinvent itself.


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Companies A, B and C - Conclusion

Three companies

Different business, different cultures, different age groups, different advantages

and different disadvantages.

All of them improved, though each in a different context and in a different

manner.

None of them was one mans job. Everybody participated, achieved what they

could only with available people and resources.

All of them focused on what they controlled and what they could change, not

on what they did not control and therefore could not change.

The available knowledge and skills was institutionalized and became an

internal source of intellectual growth and learning.


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Renewal

Innovation

Initiative

Imagination

Success

Success

Arrogance &

complacency

Competition

Lack of

imagination

Failure to

adapt

Collapse

Successful Companies Companies in Trouble


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Signs of a troubled business

Ineffective management style

Over-diversification

Weak financial function

Poor lender relationships

Lack of operating controls

Market lag

Explosive growth

Precarious customer base Family vs. business matters

Operating without a business plan


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Organization growth Equilibrium between external and internal constraints


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Agenda for the organization

1. Leadership in cost, quality and service of our products. This alone can

leverage the hidden 15% ( out of the 30%).

2. Updating and preserving our human assets through continuous shared

learning. Without this the above is not possible.

3. Rational upgradation of technology. The first criterion for selection of a

technology should be, do we have people who can operate it? Otherwisetrain people first.

4. People development is a not the so-called HR function. It is the primary

responsibility of every manager/supervisor.

5. Innovate ways people can know their precise responsibility and learn howto perform them.

6. Building a rationale for a genuine pride in what we do.


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Vision & Mission

Key Result Areas

Key Indicators

Performance targets

Implement plans

monitor performance

& provide feedback

Changing external and

internal environment -

e.g . Customer needs,

competition, special

market priorities,

regulations etc.

Continuous improvement

Review & realign

as and when needed

Goals to guide - Mechanism


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Effective operations

Time-boundobjectives

Path to the visionand objectives

Awareness about vision

and objectives

Learningorganization

Vision

Organization

improvement

Growth forall


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Measurement

Financial Customer

Internal Business Processes Learning and Growth


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Commoditize Skills

Recruitment Induction

Training Deployment


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Real task

The challenge before an organization is not so much as to design a better

systems or policies or to buy a new technology or to recruit more

people, as much as it is to innovate ways and means to take all the

innovations of the past to everyone in the organization and try to make

the best possible use of existing people and existing resources.


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The story of the eagle


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The eagle has the longest life-span of

its species


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But to reach this age, the eagle mustmake a hard decision

It can live up to 70 years


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Its long and flexible talons can no

longer grab prey which serves as food

In its 40s


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Its long and sharp beak becomes bent


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Its old-aged and heavy wings, due to

their thick feathers, become stuck to

its chest and make it difficult to fly


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Then, the eagle is left with only two options:

die or go through a painful process of change

which lasts 150 days.


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The process requires that the eagle fly

to a mountain top and sit on its nest


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There the eagle knocks its beak

against a rock until it plucks it out


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After plucking it out, the eagle will wait

for a new beak to grow back and then it

will pluck out its talons


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When its new talons grow back, the

eagle starts plucking its old-aged

feathers


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30 more years

And afterfive months, the eagle takes

its famous flight of rebirth and lives for

...


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Message of the story Past, whether good or bad, creates baggage.

Change is improvement - getting rid of the baggage of past.

Improvement is the only condition for survival.

It is a integral part of the natural process of life whether an individual or anorganization.

Improvement is an individual responsibility (without exception).

Improvement is real and painful. Improvement is action based on a clear understanding of what one needs to do.

Machine (technology) is a tool which is gives results when we know what it issupposed to do and how we should operate it.

We do small things; big things happen.

Thoughts are unrealistically larger than action.

Opportunities in chaos, business in order. Opportunities in noise, business in signals.

Opportunities in problems, business in solutions.


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Improvement


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Internal Coaching

Opportunities for shared learning

One-to-one informal communication

Personal bonding

Content customization around on relevant issues and learning

Builds coaching skills, so vital for leadership

Intellectual development of the internal trainers

Focus and effectiveness


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Change Management

Internal Environment

Hardware

Technology

Systems and processes

Adaptability to external environment

Learning and KM

Culture values& behavior

External Environment


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Change

1. Neither be forced nor it can be coerced; it can even be through persuasion; it can only beinspired.

2. A process of making an individual primarily, and organization collectively, what they should

be.

3. Adapting internal environments and conditions of an organization with the rapidly changing

external environment.

4. Equilibrium between internal and external environments with respect to an organization and

also between organization and individual and among individuals in an organization.

5. This equilibrium is a dynamic one and the most serious threat to it is emotional individual

and organization behavior and culture.

6. In other words, change is about transparency and encouraging human respect and values in a

organization first and foremost.

7. Transparency is essentially de-complexing the organization and therefore change is about

SIMPLICITY., because simplicity and transparency are synonymous as both of them have

the same goal make things what they ought to be.


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Finally

Dont get scared.

They are not difficult at all if you try to understand them because you have

been doing this anyway all these years, may be in a different way.

You know you business better than others can ever do, because you have beenwith it through its highs and lows.

Most of these things are no longer a choice, as global changes, governance

imperatives, etc. are forcing them anyway, one-by-one.

So bite the bullet.


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Actions:

1. We must recognize that business operate at tow levels primarily

transactions and monitoring.2. You have to make a decision and commit yourself to it (improvement at any

cost in process adherence and compliance).

3. The basic issue will be people capability.

4. They have enough knowledge accumulated over time and loyalty to theorganization which is needed to achieve this. It needs to be captured,validated, integrated, documented, institutionalized and shared with those

who need.5. Our existing resources and technology may not be the best but we can make

a better use of it.

6. Doing this will build a platform for training and developing people on thejob.

7. This itself will create confidence and passion necessary to trigger change.

8. You would need to take the process forward and sustain it.

9. This is the the least and the most that we can do to begin the process ofimprovement.

10. It is simple but certainly not easy.


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AIMAAIMA Impact assessment: impediments to growthImpact assessment: impediments to growth

Market related 70%

Finance related 25%

Government policy related 12.78%

Power / infrastructure related 14.0%

Technology related 14.60%


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SMEs predominance in

Food products

Chemicals and chemical products

Basic metal industry

Electrical machinery and parts

Rubber and plastic products

Machinery and parts excludingelectrical goods

Hosiery and garments

Wood products

Nonmetallic mineral products

Paper products and Printing

Transport equipment and parts

Leather and leather products

Miscellaneous manufacturing industries

Other services and products

Beverages, tobacco / tobacco products

Repair services

Cotton textiles

Wool, silk and synthetic fibre textiles

Jute, hemp and mesta textiles

Other services

6


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For example: basic issues in marketing

Customer data

accurate and updated details on new customers such as contact, specification of

requirements, price expectation, etc. not available in most cases.

Available data bases and information on websites are not enough.

Request for above information is not responded properly.

Quotation

There are more than reasonable mistakes in quotations and poor follow up.

Comfort zone

Dependence on existing customer base and natural market growth.

Marketing

The basic concept of marketing is not understood.

Marketing and selling are thought to be the same.

Customer feedback and involvement

Delivery and quality are compromised.

Order execution and documentation.


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Indian experience in SME Banking

SMEs are vulnerable

Information about SMEs is scarce

SMEs are geographically dispersed

SMEs are transaction intensive


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For example: factors inhibiting banks in SME

financing

Sketchy data on the financial position and lack of comparative data.

Lack of transparent credit information, access to credit history

Limited sectoral data

Low capitalization and collateral- high impairment propensity

High cost of acquisition of new client, high cost of credit processing, services& delivery coverage

Difficulties in effective monitoring of accounts/ capturing cash flows.

Poor legal framework for collateral enforcement

No secondary market for SME loans

No clear exit route for private equity

Fortunes depend more on the individuals behind the business rather than

business/ trade cycle/ behavior. Vulnerability of the small sized players to globalized economy.


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Harsh Mariwalas innovation

What their precise roles and responsibilities are?

How they can perform their roles?

How their performance is measured?

How their performance is improved and rewarded?


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Future technologies/industries will require more prepared

organizations: an example from future variants of the old

energy industry1. Capturing wind

2. Solar energy

3. Electricity from the oceans

4. Combined heat and power5. Super-efficient homes

6. Electric cars

7. Motor fuels from cellulose

8. Capturing carbon

9. Biochar

10. Soils and forest


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A few inevitable realities

It is no longer product obsolescence alone; the technology itself gets

obsolete very quickly.

The IR of yester years is going to get replaced with a far more complex

structure of employer-employee relationship. No longer the illiterate

blue collar, but more informed, suave and sophisticated pool ofpeople with very high levels of expectations. Can the present

infrastructure sustain that?

Basics are the bases of all technological advancement.

Aircraft evolved from craft when basic theories/principle were

understood clearly and applied methodically


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Surplus

Basic issues is productivity of people and assets.

We dont understand money market or currency market, but we need to

understand where and how money should be utilized and that is the most basic

principle of business.

Availability of money happens either we produce surplus or we print money. It

is anybodys guess which is more sustainable. SMEs real development (not lip-service) can alone give a sustainable

response to global crises we face or are likely to face from time to time,

because statistics show that majority of people (70%) get employed in this

segment. An increase in the productivity (managerial and technical) of people

in this segment will have an overall positive impact on the economic well-

being.

NSDC 70-80% of people are B.Sc and below.


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Management innovations in SMEs

Most productive utilization of available people and technology resources

within the enterprise.

Knowing what to do with resources and institutional framework we wish to

have.

Inputs, process, transactions and monitoring.


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Three options for anyone

1. Lead

2. Follow

3. Get out of the way


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The attributes of a desired state of working in a business

organization

A process is well understood when:

All critical sources of variability are identified and explained to people who are

responsible for correct execution of the processes.

Variability is managed by the process.

Product quality attributes can be accurately and reliably predicted over the design

space (boundaries) established for materials used, process parameters, manufacturing,

environmental and other conditions. Organizations product (& service) quality and performance are achieved and assured by

design and implementation of effective and efficient business processes.

Product and service specifications are based on a thorough understanding of how inputs

(raw material and human efforts) and business process factors impact product and service

performance

An ability to effect continuous improvement and continuous real time assurance ofquality

The Learning and development systems work towards attaining the above conditions.


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Challenges Key issue Reasons Solutions

Operational

Marketing

Financial

Technology

Skilled people

Global environment

Domestic

regulatory and

governance


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Macro - challenges faced by SME sector in india

Pre-Globalisation Post-Globalisation

Local/National Investment Collaborations

Single-firm activity Strategic alliances

Manufacturing for self-identified market

Outsourcing-local/international

Local market World market

Rigid production system Flexible production system

Limited economic interest Focus on growth

Protective policies Survival of the fittest

family managed businesses, smes and start ups - opportunties tomorrow, responses today

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