Merits of a Small Company

By Aldain Reid - Gleaner Contributor

Prior to starting my own business four years ago, I worked as junior manager at a large multinational corporation that had its corporate headquarters in the heart of the nation's capital.
My job function provided me with an opportunity to observe big business and small-business operations from both the employee and the management perspective.
This experience, along with my subsequent foray into entrepreneurship, has taught me that increasingly, in most niche markets, small businesses can realise competitive advantages that larger businesses find difficult to attain.
Adjust rapidly to change
Small companies tend to operate with a fairly simple, flat management structure. As a result, customers experience a more efficient flow of communication with project managers. For the most part, key business decisions can be made without the delays associated with multiple levels of management approval.
In addition to this, small businesses are more aptly positioned to adjust rapidly to change. Decision-making is streamlined and team members expect to exercise a range of skills and experience, rather than to be specialists in only one task area.
If one member of staff is on leave or needs to be temporarily re-assigned to a different project, there is typically another team member who is already trained to assume this responsibility.
If you want to start your own business one day, then working for a small company can be a valuable learning experience.
The truth is, you have to be somewhat of a risk-taker.
You are likely to be putting in longer hours and there is also the risk that if this company failed, you will be out of a job.
However, the chance to work under the guidance of an entrepreneurial trailblazer exploring new, uncharted terrain can be quite exciting. Here are some advantages:

Multi-tasking:
In smaller organisations, you tend to manage multiple tasks. The smaller the company, the more hats you'll wear and be expected to be flexible, adaptable and have a wide skill set. For those individuals that like variety, working for a smaller company can allow them to stretch and develop competencies beyond the technical or hard skills required for the job.
Very often, your creative, marketing and strategic business skills will be utilised to think creatively to solve problems. The levels of experience gained in this environment can prove invaluable. One day you might be designing a new product, the next day, closing a major sales deal. It's up to you to seize the many challenges and opportunities that come your way in such a dynamic environment.

Challenges:
One of the biggest joys of working for a small company is being part of a team that is constantly striving towards improving their product and service. There are often times where the goals are even loftier and are fuelled by a drive to become the leader in the industry.
Direct impact on the bottom line: More often than not, your work in a smaller company will impact the bottom line more directly than working for a larger organisation. This responsibility can be very positive as your contributions will be appreciated as the small team strives to build the company and increase profits.

Rewards:
Working for a small company presents a trade-off between risk and reward. If the company is successful and goes public, for example, you can make lots of money. Bonuses might be based on sales, stock or equity.
Small companies are often benevolent when it comes to offering creative perks to their employees, such as the flexible hours and the option of telecommuting. Of course, there's always the very real risk of the business failing. In the unfortunate event of this happening, you'll still walk away with a wealth of professional experience.

Smaller and independent teams:
In smaller companies, the teams are small and that means that independent work is not only expected but required. If you like working alone, or with minimal supervision, working for a smaller company will suit you perfectly. You'll be highly accountable for your work, but your initiative, drive and ability to make decisions that align with the company's overall missions and goals will be appreciated.

Creative environment:
Small companies tend to be more receptive to new ideas, and as such they attract imaginative types who enjoy brainstorming creative and ingenious ways of doing things.
When you're working to constantly build and improve something, success often depends on the ability to think outside the box.

Scope for growth:
Many of the most successful companies in the world today started out as small businesses. Working in such an environment with huge growth potential can be very rewarding. Smaller companies can offer opportunities that larger ones cannot, such as the chance to expand and advance with the company and the chance to play a pivotal role in the growth of the business.



Aldain Reid is a serial entrepreneur and currently serves as the president of the Young Entrepreneurs Association of Jamaica. He can be contacted via his entrepreneurship blog at www.aldainreid.com

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Entrepreneurship: The New Generation

By Cedric Wilson, Contributor

He did not see a blinding light, neither did he hear the sound of a rushing, mighty wind. Yet he knew his time had come. So Aldain Reid resigned his job along with the security that went with it, and formally established RDI Caribbean.
Now two years later, RDI Caribbean, an international training institution, which offers high-quality programmes from United Kingdom-based universities, has seen impressive growth and is making inroads into The Bahamas, Turks and Caicos, Cayman and the British Virgin Islands.

Mr. Reid, who is also president of the Young Entrepreneurs Association (YEA), is convinced that entrepreneurship is critical in achieving rapid sustainable growth in Jamaica. And he is right.
If you consider the Jamaican economy with per capita income a mere one twelfth of what exists in the United States and one third of what obtains in Trinidad and Tobago, then you would have no difficulty accepting Mr. Reid's position. However, this perspective becomes more persuasive when you understand that it is not simply a question of where you are at present, but how far you can go, given your circumstances. The journey from Kingston to New York is a couple hours by plane but by sailboat, it might take a perilous fortnight, if not longer. The public debt is approximately 132 per cent of the country's total annual income (GDP) and about 31 per cent of that income is used for debt servicing. This, of course, puts enormous constraints on the economy and expresses itself in a thousand and one different ways - deficient health facilities, severe unevenness in the quality of primary and secondary education, poor tertiary roads, and the list goes on. These realities make the journey to development a voyage by sailboat rather than aeroplane.
Seven per cent growth required
Recently, the Planning Institute of Jamaica was given the job to fashion a national development plan to transport the country to high-income status by 2030. According to Dr. Wesley Hughes, the top man at the institute, this will require the economy to grow at an average annual rate of around seven per cent. Dr. Hughes was sanguine about this prospect, pointing out that it was achieved in the early 1960s.
However, given the nature of the economy, conventional tools of macroeconomic management cannot conceivably produce economic growth of seven per cent on a consistent basis over the long term. The sheer weight of the public debt, coupled with its sensitivity to interest rate and an exchange-rate movement, allow little scope to manoeuvre. As such, whatever the outcome of the general election, any responsible government must follow the path of fiscal discipline and focus on macroeconomic stability.

In other words, regardless of how strong the temptation might be to significantly expand government spending, it must be avoided. The repercussions would be disastrous. Therefore, focus must be centred on bringing down interest rates, holding back inflation, avoiding exchange-rate volatility and keeping the budget deficit at a minimum.

No more dramatic policy reversals
The International Monetary Fund, in its 2007 Consultation Report, emphasised the importance of the role of confidence and suggests that "a 30 per cent weakening of the currency" could result in the dramatic increase of the public debt to 170 per cent of GDP. It is, therefore, quite clear that fiscal and monetary consolidation is not optional, if at least a modest degree of growth is to be maintained. The days of dramatic policy reversals are over with changes in political administrations. Outside of that, the economy will be condemned like that tragic figure from Greek mythology, Sisyphus, who must repeat forever, the back-breaking task of pushing a rock to the top of the mountain only to see it roll down again.
But in light of the fact that the familiar tools of macroeconomic management can only produce growth rates of two to three per cent, how can the economy achieve seven per cent? How will the country move from its lower-middle income position to developed world status in the next quarter century?

A part of the answer, Mr. Reid will tell you, rests in creating an environment in which entrepreneurship can flourish. For a long time, serious entrepreneurship in Jamaica was linked to a set of families and a few adventurous outsiders. And to make matters worse, the outsiders often displayed a tendency to think small and put limits on business expansion. But times are changing.
The world is suddenly much smaller, information is much more accessible and there is now a new generation of entrepreneurs who are educated, energetic, aggressive, street smart and technologically savvy. These are the people with the greatest potential of ensuring that the voyage to 2030 is not in a sailboat but a plane. This is where the possibility of seven per cent growth exists.
Nation of hustlers

In the 2006 Global Entrepreneurship Monitor, Jamaica is ranked fourth among 42 countries for early-stage entrepreneurial activities. The report estimates that one in five persons in the adult population is actively planning or has recently established a business. And this is not surprising, for we are a nation of hustlers. However, what is necessary is the development of strategies by the Government to convert this potential into something meaningful. It may be argued that the reason why tax revenue is so low and the formal economy is smaller than what it should be, is the inability of the authorities to embrace the complex and dynamic energy that abounds in our people and covert it into GDP.
It is in this context the YEA is advocating that the Government integrate entrepreneurship in its development planning. They also contend that greater strategic direction should be given to current programmes, such as the J$1.1 billion National Investment Fund loans for microbusinesses. And indeed, the fund should be structured in a way that it optimises economic growth along lines that are measurable. In addition, the association believes that entrepreneurship should be an integral part of the education system and more recognition given to its role in economic development. But, can the Government capture this vision and, more importantly, act on it. Or will it wait until it hears the sound of a rushing, mighty wind?

Cedric Wilson is an economics consultant who specialises in market regulations. Send your comments to: conoswil@hotmail.com.

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ON YOUR OWN - Tips for Aspiring Entrepreneurs

By Amitabh Sharma

THERE ARE many, who strive to get a job and climb up the career ladder. Then there are some, who are bitten by the 'bug', as entrepreneurship is often referred to.
Those who have chosen the latter say this route is exciting, as well as full of challenges.
"The path of entrepreneurship is exciting," said Aldain Reid, president of the Young Entrepreneurs' Association of Jamaica (YEA), "There are numerous prospects that will facilitate the growth," he added.
Reid, who prides himself in being a serial entrepreneur, started out with a dream and made his way to the top. As a businessman, he has a multifaceted role and recommends that persons, who have a knack for setting up their own ventures, should always follow some basic principles.
"I would like to share a few tips which, I believe, will enhance your prospects for success," said Reid.

Networking
"Networking is as old as the hills, but many entrepreneurs still do not get it right," he pointed out.
Reid said networking is not merely about how many business cards you collect. It is about making the right connections with people to exchange ideas, information and resources to make a difference in your surroundings.
"The best networkers are good listeners who focus on other individual's needs," Reid declared.
Reid suggested one can find great contacts at events and recommended joining a peer group, such as the YEA.
"There's nothing effective like swapping ideas with those who have been there, done that," he said.
Reid said interaction not only speeds up the learning curve but also provides an opportunity to interact with like-minded individuals.

Negotiating skills
"Getting the best deals is critical to the long-term success of your company," he pointed out.
The YEA president said entrepreneurs often fail to realise how much time they spend negotiating deals.
"Whether it's with our staff, customers, suppliers or partners, we are constantly negotiating," he said.
Reid believes one should view negotiating as a problem-solving exercise rather than a competitive sport.
The keys to successful negotiating are listening well and a willingness to be persuaded.
"Typically, the outcome of a negotiation is based on the amount of preparation you do," he said.

Communication
According to Reid, it is vital to understand communication skills and articulating key messages is the key.
"Whether it is the employees, customers, media or shareholders, an entrepreneur must be consistent," he said.
"Successful entrepreneurs must not only make themselves heard, but hear others," Reid believes.
He said one should listen to what people are telling and establish mechanisms to encourage feedback. He recommends joining one of the Jamaica chapters of Toastmasters International to improve public speaking skills.

Striking a balance
Reid said like any other profession, it is necessary to strike a balance in one's life. "Many entrepreneurs sacrifice their personal life to grow their businesses," he pointed out.
The YEA president said that if one is overworked, the focus will be lost and one would be less responsive. "If overlooked for a period of time all these things can lead to failure," Reid warned.
To take time off, it is critical to have an effective team in place. Reid said they should have the competency to run the business in your absence. "You simply cannot have everything funnel through you," he said.

Focus on your team
People are the key to what drives the success of a business.
"No company can move forward unless its employees are on its side," Reid pointed out.
He said winning teams are built on trust, respect and a mutual liking for each other.
"One does not require any magic wand or charisma to be a good leader. Modest leaders who can connect with their employees lay foundations for a well-run team," he explained.
It is also critical, he said, to get feedback on your performance.
"This process may be painful, but it will make you stronger and help you learn from your mistakes."

Think outside the box
Reid said change is the only constant in business, from evolving markets and economic trends to emerging technologies, the ability to anticipate change and how it will impact business is crucial to the longevity of a company.
"One needs to have an all round knowledge. Entrepreneurs should know about the intricacies of complementary business sectors."
It is also essential to keep abreast what is happening globally.
"Some of these events can have repercussions locally," Reid explained. "You should think of this information as a tool to compete and win."

Finally, Reid recommends being creative, build knowledge from interactions with contemporaries, customers and those in other industries and sectors.

"Entrepreneurship is a learning process," he said. "The more you are open to learn will determine the growth path your business takes."
Ask your self constantly, he said, what others are doing that you are not and how can you improve on what they are doing.
amitabh.sharma@gleanerjm.com

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