Mentors Can be Key Role Models for Entrepreneurs

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Given the current economic challenges facing many countries across the globe, the notion of engendering greater entrepreneurial activity has become a significant goal for many national governments.

However, the challenge facing policymakers is to identify ways in which they can develop indigenous entrepreneurial potential and simultaneously renew the local economy by building competitive advantage.

It is almost 20 years since researchers first noticed that generating vast numbers of new jobs will not come from creating new firms. Instead, they will come from a small group of high-growth firms.

Since that time, policymakers and researchers have been seeking to determine the characteristics that define high-growth firms and how these characteristics could be replicated by many more entrepreneurs.

It is broadly agreed that if a firm is to achieve sustained expansion, it must satisfy a number of requirements for growth: it must increase its sales, it must have access to additional resources, it must expand its management team, and it must extend its knowledge base.

But each set of requirements establishes a different set of obstacles for the entrepreneur. While some of these challenges are external to the firm, a feature of the firm’s operating environment that is impracticable to alter, many of the challenges will be internal, generated by the growth of the firm.

Indeed, the principal challenges that exist in most firms are weak management skills, lack of finance, and poor knowledge of international markets. However, many of these issues can be addressed through tailored training programmes.

According to a report by the European Commission in 2006, the development of management capacity relates to four main fields of expertise relating to the owner/manager:

1. Strategic and management knowledge aspects (including human resource management, accounting, financing, marketing, strategy and organisational issues).

2. Understanding the running of the business and of the potential opportunities or threats.

3. Willingness to question and maybe review the established patterns.

4. Attitudes towards investing time in management development or other needed competencies.

One of the primary reasons that management development programmes can fail to improve a firm’s performance has been that certain conditions must exist for the programme to have meaningful benefit.

But primary amongst these conditions is that for any progress to be achieved the entrepreneurs themselves must be motivated to grow the business.

Additionally, the entrepreneurs participating in such programmes must also be provided with increased access to networks, finance and international markets if they are to grow the business beyond small scale achievements that do not make any material difference in terms of job creation.

Possibly the strongest finding to come from the research regarding existing programmes on management skill development for growth-orientated entrepreneurs is the role of mentoring and how the mentors must be people who have already achieved significant business success.

The mentor must be a person who has the experience and access to networks that enables the growth-orientated entrepreneur to expand their horizons.

The mentor also acts as a role model and reinforces the belief of what ambitions can be achieved. The ‘Going for Growth’, ‘Endeavour’ and ‘Leadership4Growth’ Programmes are good examples in Ireland of effective mentoring support that is available if an entrepreneur really wants to grow their business.

While the country urgently needs a larger pool of entrepreneurs who wish to grow their business internationally, thereby generating thousands of additional jobs, the reality is that the desire to grow a business is not a goal for all entrepreneurs.

Therefore it is critically important that those entrepreneurs who do view their future as international success stories must be afforded tailored support and mentoring to ensure they have the best prospects of succeeding.

It is certainly true that such support requires greater levels of financial and personnel resources, plus any positive results will not be immediately visible, but increasingly global research is providing strong evidence highlighting that such a strategy will generate the best results.

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About the Author:

Professor Thomas M. Cooney (B.Comm, MBA, PhD, MMII, MCIM, FIMCA)

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