Abstract july 2005

adalberto geradini http://prendersicura.blogspot.com geradini@alice.it

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INTRODUZIONE Quella che segue è una sintesi della Ricerca Comparativa fra giovani imprenditori egiziani ed italiani,

realizzata con FORMAPER, all'interno del Progetto EBIS per la costruzione di una Entrepreneurship

Academy, parte dell'esistente Egyptian Junior Business Association che è attiva a Il Cairo dal 2001.

L'Academy è finalizzata alla promozione e allo sviluppo dell'imprenditorialità delle PMI in Egitto,

attraverso servizi di formazione, consulenza, project start up, networking ecc. Il progetto ha previsto la

progettazione e la preparazione di uno specifico Strategic Business Plan che ho realizzato conducendo

anche questa Comparative Research sottoforma di Progetto Pilota.

In sintesi, lo Strategic Business Plan pone il focus sull'intera organizzazione mentre il Business Plan di

solito si riferisce a un programma, prodotto o servizio specifico. Vuole dare un contributo al processo

decisionale strategico nel determinare dove l'organizzazione vuole andare nei prossimi anni (mission,

vision, obiettivi), come ci vuole arrivare (strategie, partnership, struttura organizzativa, approcci al

marketing) e come saprà se c'è arrivata (indicatori generali) Oltre a essere più conciso e meno "finanziario"

del Business Plan, l'SBP è un valido strumento per canalizzare energie, risorse, lavoro in team del Comitato

di Direzione. In questo caso specifico ha avuto una forte valenza operativa poiché al suo interno sono stati

inseriti alcuni Progetti Pilota concreti e velocemente realizzabili, che sono serviti per correggere

l'approccio, testarlo, validarlo e contemporaneamente trasferire know how al partner locale. Adalberto Geradini

Abstract from:

Strategic Business Plan July 2005

Annex 1:

COMPARATIVE RESEARCH REPORT

1. INTRODUCTION

2. OBJECTIVE 3. ACTIONS, methodology

4. OUTPUT, overall considerations

5. ATTACHMENTS

5.1 The interview grid

5.2 Comparison

5.3 Abstracts of the 6 case studies

1.0 INTRODUCTION Formaper, Agency of Milan Chamber of Commerce Industry Craft and Agriculture sezione Attività

Internazionali, www.formaper.it, and EJB, Egyptian Junior Business Association, www.ejb.org.eg, have

designed a cooperation project in the field of entrepreneurship development and support to new

entrepreneurs. The project acts under the umbrella of the programme named “EBIS” managed by

Eurochambres, the Association of European Chambers of Commerce and Industry, and the Egyptian

Industrial Modernisation Centre (IMC) and it is aimed at supporting Egyptian business representative

organisations through training and capacity building initiatives provided by the European Chamber

network.

Through the implementation of pilot activities, the project will achieve the drawing up the Strategic

Business Plan for setting up of the EJBAcademy which will function as a platform where training initiatives

and promotion activities will be designed and implemented in order to spread in the Egyptian society the

value of entrepreneurship . One of the pilot actions foreseen by the project, is to conduct a comparative

study on needs analysis of new entrepreneurs in Egypt and in Italy. The study has been realised with the

scope to produce material that could be utilised by Entrepreneurship Academy (EA) of EJB during its future

activities to design and produce tailor-made and effective services of entrepreneurial support activities.

This activity had Formaper and EJB experts interviewing 3 new entrepreneurs in Egypt – members of

EJB – to analyze and assess the start up phase of their business, observe the process of elaboration of

entrepreneurial ideas, discuss the encountered obstacles and difficulties, analyze the available of support

services and their effectiveness. The same activity has been conducted with 3 new entrepreneurs in Italy and

at the end the following document, containing observations raised by the different “case histories” has been

produced.

Abstract july 2005

adalberto geradini http://prendersicura.blogspot.com geradini@alice.it

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2.0 OBJECTIVE

The main goal of this comparative study, based on samples of some new entrepreneurs (6) in Egypt and

in Italy, is double: on one side is to observe the process of elaboration of entrepreneurial business in order to

show some concrete clues and guidelines to the would-be entrepreneurs that can also be of encouragement to

them. On the other side is to produce material useful for training institutions to find which training support is

necessary to new entrepreneurs, since the mission of a pragmatic entrepreneurial training is not only to foster

the set-up of new enterprises but first and foremost, insure highest survival rate of the newly established

businesses facilitating their further growth and development.

The objective is not to identify experiences that can be reproduced as they are, as the transferring process

requires in any case a deep action to conform to local circumstances, but to help new entrepreneurs to

understand the complex processes that are the base of the success of examined organisations and to identify

concrete examples containing ideas and practices where to learn. It has been assumed that showing some

various experiences, even in some case not homogeneous, will help to germinate and to develop, through a

“cross contamination learning process”, good practices. For that reason the six case studies have been

chosen for their innovative character in the context where they operate and in situations very different in

terms of clients, typology of services offered and management aspects. At last the intention of this

investigation was to describe and to analyze successful business experiences, born and developed in different

conditions to verify what can be transferred in the environments where EA will be active, and not to produce

an academically research.

Secondly, as the starting phase of a new enterprise usually is the most delicate one, we have been

interested in focusing how entrepreneurs started and how they adapted to their environment, without any

intention to define a model, but to obtain basic inputs for designing effective services to support youngs in

business with new training and support initiatives, connected to the needs of the local market. For that reason

it has been selected organisations alive and active on the market since a minimum of 2-3 years that have

already overcame the difficulties connected to the initial start up phase. These case histories could make up

valuable tools for EA called to plan and to implement the new services, giving suggestions for service

implementation, to suggest concrete actions and services to support the start up, the management and the

development of young entrepreneurial activities.

3.0 ACTIONS The analysis of the six cases has been done by means of interviews utilising a questionnaire having a

common grid made by open-ended questions. To help the entrepreneur to reflect and to compare the

difficulties encountered at the initial start up phase and now, at the end of the interview it has been asked to

the entrepreneur to fill in a grid with items derived from Formaper research NR. 67

4.0 OUTPUT: overall considerations Once more, as already mentioned, it has to be emphasised that the restricted sample, in term of quantity,

qualifies this not as a formal research but as a pragmatic analysis focused on highlighting histories and

eventual common problems. The interviews and examination of the case studies made on evidence the

following aspects:

• General. The organisations that became solid and stable, with an acceptable balance between costs and

quality, reached that equilibrium with a difficult and delicate process that meant working also in the

following two directions. The first was to develop and accept at the beginning both low profitable and

high profitable projects. Usually the firsts were utilised to enter in the market and to tie with the first

clients but immediately after that, they have been adapted and recycled for new clients, becoming in this

way high profitable. An aspect that was common to all the first projects is that the services offered were

qualified and highly visible, not necessarily revolutionary but innovative in one aspect or in another,

unique, extremely client oriented and devoted to build a concrete reputation of the entrepreneur.

The second direction was the quite wide diversification of clients, services and suppliers. The necessity

to be quick to survive brought the enterprises to define the target of clients but not as precise and limited

as it can be done once the firm is established. To diversify did not mean accepting or doing everything

but follow a precise line (the entrepreneur individual mission and the vision) considering the target an

Abstract july 2005

adalberto geradini http://prendersicura.blogspot.com geradini@alice.it

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opportunity and not a constraint. The diversification was also functional to the realisation of cost savings

utilising the resources.

• Marketing. One of the most critical aspects mentioned in the interviews was how to become well known

on the market starting from zero. The communication towards the clients was established in some cases

following the classical path, building a database and sending brochures or e-mail, in other situations the

entrepreneurs started since when attending the school courses and contemporarily selling various

services to the students or to others, in this way they trained themselves, utilised it as a learning

opportunity and became known. But the real investment of time and energy dedicated by the

entrepreneur to this field was to expose oneself, being visible as owner, participating in several

occasions, even social and not only professional, and through the personal contacts establishing a strong

external net of relationships, where the passion in the own entrepreneurial idea combined with the

rationality to understand the needs of the possible client. It means to be deeply rooted in the territory and

spend a considerable amount of time and energies, sometimes in conflict with the private life.

In general, the structured marketing competencies, as the administrative ones moreover, are

considered fundamental but with the awareness that they are often missing in themselves. This because is

also declared that the training institutions give a professional background in this field, with instruments

and tools, but generally speaking they are focused and tailored to the medium-high or already established

enterprises, that have a lot of capitals. Another point, an emotional resistance to structure the marketing

activities in a professional way, is that often the founder fall in love with his idea and not with the market

or with the numbers that depicts it.

• Organisation From some interviews, specifically the ones had with the youngest, still stands out an image of

entrepreneurship as something that is ambivalent: from one hand it is perceived as an opportunity to deal

with flexibility, creativity, to manage one’s autonomy but on the other hand it is perceived as something

uncertain and pervading all own existence, a condition that does not facilitate private and social life. The

majority of entrepreneurs interviewed declared that the decision to become entrepreneurs was absolutely

autonomous but influenced by the example of other entrepreneurs while institutions and schools were

scarcely influent.

Especially at the beginning, the leadership style adopted in their organisations is not autocratic but

established by the capacity to identify interesting projects and to aggregate around them the necessaries

resources, choosing the persons one by one, motivating them, and leading through the deep knowledge

of the service produced, more then through the management skills.

This, the management, remains a delicate point where all the learning done at school is judged not

adequate to SMEs reality. From one side it seems that every management approach is considered heavy

and on the other hand there is the research for a magic wand, “the tool" that can solve any problem. The

impatience that distinguishes the start up phase, not easily copes with the necessity to think both wide

angle and in a structured way, and with the fact that this attitude is not an optional for the successful

entrepreneur and that requires specific dedicated time.

Moreover it is emphasised the capacity to be flexible and to change in progress, without being tied to

one’s decisions and to accept mistakes and critics without considering them an attempt or insult to one’s

ownership. It has been underlined the importance to establish a network with clients, with possible

collaborators, with other entrepreneurs, with experts and so on. If the enterprise grows and other

collaborators are engaged, there is the difficulty to deal with the division of roles and responsibilities,

often with the same people with whom the adventure started. On the other end young entrepreneur tend

towards to establish horizontal relationship, in "horizontal team" and faces in the organisation the same

problem that meets in his period of life: how to deal with the authority.

There is the awareness that persons have to be considered “human capital” more than “human

resources” as they are essential to develop innovative ideas and that enterprises can take advantage by

making the most of knowledge, competencies, relationships of their employees. This, once more, means

that entrepreneurs have to update their training but sometimes their long working time does not allow

them to follow formal, institutional courses. More over it is evident that they appreciate and require

learning approaches where they can learn one from the other in a benchmarking situation, starting from

realisations and not from models. To share experiences, to collaborate in virtual project team or network,

as it happens in long distance learning, monitored by tutorial assistance, can help entrepreneurs to find

Abstract july 2005

adalberto geradini http://prendersicura.blogspot.com geradini@alice.it

4

inspiration and advices, to access to technologies and relationships, may be to individuate new

partnerships.

• Economics

As the enterprises interviewed were not production companies, the necessity to have big amount of

capitals was not essential during the phase of the start up, but almost everybody met several difficulties to

find the necessary funds, and this became crucial for maintaining and developing the enterprises. In

the”Eurobarometro”, research on European industries on the obstacles to the enterprise foundation, 76%

of people interviewed indicated as main obstacle the lack of available capitals and 69% the complexity of

public administrative procedure, even if it is true that the decision of the individual to found and to

expand the enterprise is influenced by many other factors not purely economical.

Also in the European Business Survey Grant Thornton 2002, more than 20% of SMEs declares had

problems having long terms financial loans, while for the banks the high level of general expenses

connected to small amount credits make them not interesting. Besides banks and investors need reliable

information, previous positive elements and guarantees that usually new young would-be entrepreneur do

not have, mainly if they deal with totally new products or services in social and knowledge field. A

common component of any SME development strategy is access to finance both for starting up and

entrepreneurial growth, and the availability of information to enable easier access to finance becomes the

real core, the critical point. Often there are funds made available by public institution, local or

international, but the communication channels are not known to young would be-entrepreneurs, neither to

others, and the procedures are long and complicate.

• Relations with Public Administration

Main difficulties found with PA are represented by two items: long terms payment and exhausting/

twisting decision making process, that are exactly the opposite of what a new enterprise needs and thus to

be easy going in the process: contract award- performance-release the project-payment- begin a new

project. For the first item, long terms of payments, a new enterprise can not sustain a long period with no

money, there is the necessity to work very quick on new projects, to make experience and profit.

The second item is tiring, time consuming and also contradictory to the attitude of young generation,

focused on variety, curiosity and simplicity of relationship accompanied with inexperience in diplomatic

relations and bureaucratic traps and formalities. Even if administrative procedures for founding a new

enterprise already took benefit from Public Administration that reduced the average time necessary to

begin an enterprise (mainly the individual one) it has been told that further improvements relevant to

procedures, contacts, formats, permissions, licenses, authorisations and costs are essential.

• Quality and innovation

Everybody gave big attention to quality that is considered fundamental in establishing client fidelity.

In this sense is essential to have skilled personnel but it has been evidenced the difficulty to find and to

recruit competent people, to pay their high cost and to face the risk, always present but more important at

the beginning when the entrepreneurial idea is really new, that after a while this people leaves them for

other enterprises or to become a competitor. For that reason the entrepreneurs interviewed underlined the

opportunity to establish a motivating organisational atmosphere where the entrepreneur also teaches,

trains the others, creating a development environment where one can improve his professionalism.

Specifically, the fact that the quality is strictly connected to the perceived quality by the users requires to

be rooted in the territory, to know it very well to have the capacity to interpret the client needs and to

design an adequate offer. It is not common that at very beginning one proposes services on the global

market.

Another aspect is the tendency to consider "creativity" that produces innovation as something purely

genetic, you have it or you do not have it, without considering that the applied creativity is developed and

increased through the interaction with the environment. This is a continuous learning process that can be

trained, even if it is mentioned the lack of diffusion of reliable courses on this matter. The competitive

pressure brings enterprises to research continuously knowledge and innovation management. Enterprises

can upgrade themselves in different ways, by the technological development, by the total quality

management, by new ways to organise the work or distribution channels, by the brands or by the design

and so on. Everything in some way can be done internally but for the SMEs and for new entrepreneurs

there is a specific sensibility to be accompanied on these matters in a substantial way.

Abstract july 2005

adalberto geradini http://prendersicura.blogspot.com geradini@alice.it

5

• Relations with the territory

Accordingly to the research done by the Global Entrepreneurship Monitor (GEM 2002 Summary

Report) 7% of new entrepreneurs, in case of success, gives rise to a new significant market niche, while

70% of new enterprises supplies products or services in markets already existing where the competition is

already remarkable and the critical technology and know how is available since one year.

A global approach to entrepreneurship could operate on three levels: the individual, the enterprise

and the territory/the society, in a systemic way where each item influences and is influenced by the

others.

To motivate people to become entrepreneurs could be done explaining them what it means in reality,

without any under or overestimate, in order to develop their sensitivity to the concept and to the values

of entrepreneurship and make interesting and appealing their eventual choice, starting from self

assessment and driving them to acquire the requested skills to transform their ambitions in real

successfully projects.

For the second step, to transform project in “healthy” enterprises, specific environmental conditions

are required, some of them mentioned before, that would promote the development of enterprises

allowing them to grow and to develop but without any interference in the normal.

5. ATTACHMENTS

5.1 The interview grid

5.2 Tabulation

5.3 Abstracts of the 6 case studies