download (1,2 MB)
description
Transcript of download (1,2 MB)
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Facilitating knowledge based sustainability of
economic growth by applying UNIDO
methodology, IT tools and developing of best
continuous improvement practices
in
Training & Upgrading Programmes for
Entrepreneurs
Measuring and Improving Business
Results
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Presentation at World Association for Small and Medium Enterprises
(WASME) 2005 Conference in Bucharest, Romania, 16-18 May 2005
by
Serge Golovanov,
PhD, Dipl.Eng., UNIDO International Consultant
Director, Enterprise Performance Improvement Centre,
GOLEM IMS GMBH, Vienna, Austria
in partnership with United Nations Industrial Development
Organization (UNIDO), Vienna, Austria
www.win2biz.com www.golem.at
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Focus on Small and Medium Enterprise performance and innovation management
capacity:
• Do entrepreneurs manage businesses
with high efficiency and min losses?
NO!
• Do they have & use IT tools to measure
business results and simulate decisions?
NO!
• Can innovation, technology transfer be
managed effectively in such cases? NO!
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Definition of Small and Medium-sized Enterprises
Category Number of employees
Middle 50 - 250
Small 10 - 50
Micro < 10
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Estimations of lost gross profit (GP) due to various inefficiencies, per annum
Enterprise Group 1 (GP € 400,000): 54,900 €
Enterprise Group 2 (GP € 3,000,000): 215,500 €
The price of ignorance (UK case studies, CoVE and MII, food industry):
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Average enterprise improvement results benchmarked after the Programme
implementations
• Overall Productivity Increase (or value Added/person) + 9%
• Improved Efficiency + 18%
• Improved Gross Profit + 25%
• Reduction in Labour cost - 15%
• Overall Effective Efficiency increase + 5%
• Acceleration of business development - 6 years
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Challenges facing entrepreneurs:
• Businesses are run with relatively high losses
and inefficiencies without knowing actual
figures!
• Major decisions are not prepared and
evaluated in necessary detail, compared by
consequences, optimized and monitored in
implementation
• The potential is underutilized, developments
are risky, results may be unpredictable and
unexpected!
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Businiess Navigation:
Measuring & Monitoring & Planning of Business Performance Results
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Sailing to target destination
Initial position
Target
(Promised Land)
Ideal path
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Sailing with navigation
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Sailing without navigation
New technologies do not help reaching the target but can make failure impact more costly and severe!
(e.g. new engine, design or construction of the ship do not change the outcome )
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
SME mortality rate after successful start-up is high due to premature death of SMEs caused by uncontrollable losses and non- efficiencies unknown to management
?Result: Most of SMEs are running life time experiment
“W i n or D i e” !
Actual data by San Paulo Department of Statistics, Brazil:
5 billion dollars lost and 530 thousands jobs in the medium and low range of manpower are lost within one year in San Paulo State only.
1,000,000 businesses closed between 1990-2002 just in the State of San Paulo worth of 62 billion dollars in invoicing and consequent losses in taxes.
(Source: Newspaper “O Estado de San Paulo”, Economy and Business Section, 4th December 2003)
Similar situation exists in other developing countries lacking of official statistics.
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Common issue:
What are the practical solutions for enterprises?
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Continuously improving business based on its measurement
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
1. Measuring business results (UNIDO Software)
2. Identifying problematic areas having measurements data
3. Formulating optional solutions which can potentially solve
problems and bring improvements (new machine, production
profile, production team change & control, etc)
4. Evaluating impact of uncertainties and risks by simulating the
major outcomes (scenarios)
5. Selecting the best (e.g. most profitable & sustainavle) option
6. Implementing the decision in practice
7. Returning to Step 1
Basic principles of continuous improvement in business
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneursComponents of UNIDO’s Enterprise Business
Performance Management Solution
Software SuiteClient Support &
Consulting on-site
Pharos – Business Navigator
Produce Plus
Financial Improvement
Toolkit
Training Course
In country – regional industrial center
Vienna or any
European location
Certification
Enterprise
Professionals
Benchmarking
Software Installation
Data collection & entry,
Biz target setup Reports,
Export-import
Measuring & Improving Business:
Developing best practices
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
1. Awareness seminars,
selecting of enterprises
2. Training courses for SME
management (5 days, < 24
persons per group)
The Programme Content & Budget
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
3. UNIDO Business
Performance
Measurement &
Management
Software tools (at least 2 licenses per
enterprise for general and
production managers)
The Programme Budget Components
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
4. Training and certification of client’s
support team
5. Transfer of know-how,
methodology to Enterprise
Management, setting best
continuous improvement practices (up to 12 months, 1 consultant support up
to 10 enterprises, installing software, data
collection, business targets, decision
support, results’ measurement, etc).
6. Final results evaluation and
reporting, conference
Phase 2 option: On-site consulting & support
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
UNIDO Performance measurement tools:
Business Benchmarking
Report
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Improvements by KBI summary graph at a glance
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Key Business
Indicators (KBI) in
bench-marking module
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
UNIDO Performance Measurement tools: Pharos Business Navigator (main menu)
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
UNIDO Performance Measurement tools: Produce Plus (main menu)
Produce Plus
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
• Pre & Post Programme enterprise benchmarking, diagnostics, performance measuring, production efficiency analysis provided for each participating enterprise (customers, suppliers, non-conformances, planning, production resources' utilization, etc.)
• UNIDO Certificates of “Enterprise Business Performance Excellence“ for enterprises and “Business Performance Management Excellence” for entrepreneurs and managers based on benchmarked improvements.
• Training of SME managers in presentation of the enterprise performance results to investors and credit institutions
Some practical outcomes
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Expected Results
• Improvement of Key Performance Indicators (KPI) ~ 10% in
average, e.g. Gross Profits, Productivity (Added Value per Employee), etc.
• Increase in taxation results • Benchmarking reports for each enterprise,• Documented Upgrading Programme results • Important benchmarking data for performance of industrial sectors• Investment environment improving due to increased transparency
of businesses• Certificates for Enterprise and its Management• Improved culture in management of business performance and
innovations, sustainability and competitiveness
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
• Average annual sales, USD - $632 000
• Net Profit average % (shoe production factory) - 5%
• Increase of net profits, post programme % - 10%
Enterprise Model Enterprise Model of Training Programme Efficiencyof Training Programme Efficiency
(net profit only)(net profit only)
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
• Number of enterprises in the sector of industry served - 1 000
• Net profit increase per sector, post-programme - $12 ,008,000
• Taxation (annual gross profit, example %) - 35%
• Increase in taxation income for Government, annual - $ 4,202,800
Training Programme ResultsTraining Programme ResultsNational Industry ModelNational Industry Model
(limited by consideration(limited by consideration net profit factor only)net profit factor only)
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Implementations
1. UNIDO integrated programme: the Republic of Komi, Russia Sustainable Industrial Development and Competitiveness, Oct. 1999
2. Strengthening of Small and Medium automotive component suppliers to deliver export quality products in India, Nov. 1999, India, New Delhi, Pune, Bangalore, Mumbai, Baroda, Nashik, Ahmednagar.
3. Application of Quality Principles To The Food Processing Sector of 7 Sub-Sahara African Countries, July 2000 Kenya, Uganda, Tanzania, Zambia, Ethiopia, and Zimbabwe.
4. Application of Quality Principles To The Leather Production Sector in Egypt, April 2001, Cairo, Egypt
5. Integrated Programme for Columbia, 4 industrial sectors, Ibage, Pereira (Eje Cafetero), Barrancabermeja.
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
6. The workshop "Strategic and production management of industrial enterprise: application of UNIDO benchmarking and business excellence tools Pharos + Produce-Plus", UNIDO ITPO/ARCEIT Manama, Bahrain.
7. The workshops "Application of UNIDO benchmarking and business excellence tools for enterprise upgrading, strategic and production management of industrial enterprises, IMC/UNIDO workshops, Cairo – Alexandria - Borg El Arab, Egypt, February - April 2004.
8. Introducing UNIDO measurement tools for continuous improvements in quality, efficiency, productivity and competitiveness in manufacturing, Association of Lebanese Industrialists (ALI), Euro-Lebanese Center for Industrial Modernization (ELCIM), Lebanon, June – October 2004.
9. Improving Business Performance by Introducing Continuous Improvement Practices Based on UNIDO Business Performance Management Software, August – December 2004, UNIDO Programme for Palestine.
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
C o n c l u s i o n s:
1. The majority of entrepreneurs, industrialists does not have sufficient knowledge, performance management tools and practices to monitor and measure their businesses, optimize decisions, eliminate inefficiencies systematically and maximize use of available resources.
2. The Training and Upgrade Programmes for SMEs introduce best continuous improvement practices and UNIDO IT tools facilitating productivity, competitiveness, quality, sustainable growth in areas where real and tangible improvements can
be made.
3. SMEs become much more transparent and better prepared for national and international investors, improving export potential.
4. The Training Programmes facilitate entrepreneurs capacity building in introduction and managing of innovations, new technologies.
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
C o n c l u s i o n s (cont)
5. The Training Programmes facilitate human resource developments, managerial capacity and potential, path to ISO 9000 standardization, meeting WTO requirements, decreasing SME mortality in the regions.
6. The Training Programmes deliver unique content and provide comprehensive package of services at acceptable cost level resulting in important Knowledge Capital Gain.
7. Governmental and international support of the Training Programs is an effective way to boost economic performance and sustainability of industrials sectors in regions.
8. The programme results are measured and documented providing vital economic and industrial statistics to organizers and donors .
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Input:< N, 000 EURO per enterprise
Training Programme
with or without on-site support<12 months
1.1. The practical instruments exist and proved: The practical instruments exist and proved: Training and Upgrade Programmes for SMEsTraining and Upgrade Programmes for SMEs
2.2. The costs of fundamental improvements are The costs of fundamental improvements are reasonable and realistic compared to any other reasonable and realistic compared to any other existing options.existing options.
3.3. The results are measurable and documented.The results are measurable and documented.
Output:Measurable increase of
major indicators including net profits,
productivity, etc.
The total enterprise service package price depends on the Programme duration, national consultants salaries in country, number of participating enterprises and some other
factors
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
International Partnerships
• Representative functions: UNIDO Focal Point – National Enterprise Performance Improvement Center
• Innovative directions of working with SMEs• Addressing key national priorities defined by Governments• New projects and funding options by EU, UN, international
and national donors• Preparing SMEs for introducing innovations and new
technologies in effective and controllable way• Training of national consultants and entrepreneurs in
country or/and in Austria • Sharing national experiences and benchmarking results• Distributing UNIDO methodology, software and best
practices
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
The MessageWe welcome associations with national counterparts supporting growing SMEs industries in countries by
– Deploying
– Training (in country and/or in Europe)
– Implementing
– Improving and Benchmarking
with UNIDO Business Performance Management Solutions for entrepreneurs bringing up productivity, competitiveness, quality and making industrial development more effective sustainable and prosperous!
Improving Productivity, Quality, Competitiveness, Performance Management &
Business BenchmarkingTraining Programmes for entrepreneurs
Development, Training and Support Center for UNIDO Business Performance Management products
Member of INSME Association
Contacts:
Enterprise Performance Improvement Centre
GOLEM IMS GMBH, Vienna, Austria
www.win2biz.com e-mail: [email protected]