Monday 6 December 2010

Strategy and the SME

I have been putting some material together for a business strategy unit and it contains the usual candidates Ansoff, BC Matrices, SWOT and Pestle; most of the literature is written about big corporates and very little on smaller organisations SMEs and even less on micro businesses and in particular life style businesses. Banks don't seem to understand life style businesses underwriting loans based on balance sheets rather than income generation.

It seems that many seem to look down on life style businesses and yet these form much of the small business economy. In fact if you look at your average local authority facilitated business group most of the members will be life style businesses.

What is needed in terms of a strategic point of view is a different perspective on some of the techniques deployed which are clearly emphasise on growth and value creation. Lifestyle businesses give focus to enjoyment of an activity that a so called lifestyle business creates. i.e. the fun or delivery of an activity, perhaps an interest or hobby, that also creates income is clearly a different matter.

I don't think corporate types and bankers should look down their noses so much on these businesses; lets face it making a living doing something you enjoy rather than commuting up to London three hours a day and attending meetings filled with corporate group think isn't really all that clever - is it?

SMEs and lifestyle businesses at the smaller end of the SME spectrum have specific strategic and tactical issues that need addressing.

These ideas need to be explored more and my new unit will contain some thinking on this as well as the traditional blue chip large corporate approaches.

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