What is en­trepreneur­ship?

The Star Malaysia - Star2 - - SOBA 2013 - By LIM WING HOOI winghooi@thes­tar.com.my

What is a busi­ness? Is it just about rev­enues, net prof­its and cred­i­tors? For some, it is an al­ter­na­tive to salaried work, giv­ing one the free­dom to choose one’s des­tiny and for manag­ing time.

For oth­ers, it may be about the means to pro­vide bet­ter ed­u­ca­tion for their chil­dren and for them to lead a bet­ter life.

Yet for oth­ers, it may be loftier am­bi­tions, not con­tent with a shop­house, or fondly known as “rumah kedai”, to hav­ing out­lets na­tion­wide or even build­ing their tow­ers and stamp­ing their mark in the cor­po­rate world. But it is not an easy ride. They work hard but still chal­lenges come in var­i­ous guises, from ap­ply­ing for busi­ness per­mits, meet­ing tax obli­ga­tions, get­ting the var­i­ous fund­ing to fac­ing com­pe­ti­tion, both do­mes­tic and for­eign.

And suc­cess did come, al­beit not to all.

De­spite the sprout­ing of mega­malls and large shop­ping com­plexes, it has not killed the mi­cro SMEs like your neigh­bour­hood nasi lemak mak­cik or your auto work­shop.

It is their de­ter­mi­na­tion to sur­vive that con­tin­ues to see the evolve­ment of SMEs from the agri­cul­tural to dis­tri­bu­tion busi­ness in the early days.

As they venture into higher value added ac­tiv­i­ties, SMEs are in var­i­ous sec­tors – you name it – from med­i­cal de­vices to aero­space.

In Malaysia, SMEs con­sist of 97.3% of all busi­nesses in the coun­try, ac­count­ing for 52.7% of to­tal em­ploy­ment and con­tribut­ing 32% to gross do­mes­tic prod­uct (GDP).

The com­mon phrase when it comes to de­scrib­ing SMEs is that they are the back­bone of the econ­omy, not just in Malaysia, but for most other coun­tries as well.

In Kenya, the govern­ment is us­ing SMEs as a tool for poverty erad­i­ca­tion.

Its Trade Min­istry per­ma­nent sec­re­tary, Si­las Njiru, said that trade and in­vest­ment ini­tia­tives would be pro­moted to fight poverty.

“By em­pow­er­ing small-scale busi­ness own­ers to do busi­ness, they will in turn of­fer em­ploy­ment to un­em­ployed Kenyans,” he said dur­ing the launch of 60 web­sites for SMEs in 2009, de­vel­oped with the United States Aid Agency and the Ex­port Pro­mo­tion Coun­cil Trade Devel­op­ment Pro­gram.

Also in 2009, US Pres­i­dent Barack Obama made en­trepreneur­ship a crit­i­cal pil­lar of US global en­gage­ment.

Since then, the US Govern­ment has com­mit­ted to sup­port­ing en­trepreneur­ship to chan­nel en­trepreneurs’ cre­ativ­ity, in­no­va­tion and po­ten­tial to cre­ate eco­nomic op­por­tu­ni­ties around the world.

Re­cently, the Global En­trepreneur­ship Sum­mit (GES) 2013 saw 5,000 del­e­gates from 123 coun­tries and 105 speak­ers from 26 coun­tries com­ing to Malaysia to talk about en­trepreneur­ship and its fu­ture. It was not just talk. In Malaysia, there are also con­crete ac­tions as seen in the creation of the Malaysian Global In­no­va­tion & Creative Cen­tre (MaGIC) for Malaysian SMEs.

It will serve as a one-stop cen­tre for en­trepreneurs seek­ing fi­nanc­ing from banks or venture cap­i­tal­ists.

It will also be an in­cu­ba­tor for start-ups.

And in early November, Prime Min­is­ter Datuk Seri Na­jib Tun Razak an­nounced the set­ting up of a so­cial busi­ness fund un­der MaGIC dur­ing the 5th Global So­cial Busi­ness Sum­mit.

The fund will be used to help the start-up of so­cial busi­ness en­ter­prises.

Also, re­cently, the In­ter­na­tional Labour Or­gan­i­sa­tion (ILO) and the Ger­man Agency for In­ter­na­tional Co­op­er­a­tion (GIZ) did a study on the im­pact of SMEs on job creation and poverty re­duc­tion in de­vel­op­ing coun­tries. Ti­tled Is Small Still Beau­ti­ful? Lit­er­a­ture Re­view of Re­cent Em­pir­i­cal Ev­i­dence on the Con­tri­bu­tion of SMEs to Em­ploy­ment Creation, the or­gan­i­sa­tions found the re­sults en­cour­ag­ing.

The study ex­am­ined al­most 50 re­search stud­ies and con­cluded that SMEs pro­vide two-thirds of all for­mal jobs in de­vel­op­ing coun­tries in Africa, Asia and Latin Amer­ica, and 80% in low in­come coun­tries, mainly in Sub-Sa­ha­ran Africa.

Not just em­ploy­ment alone, they are also con­tribut­ing to the well­be­ing of the society through their drive for in­no­va­tion and busi­ness acu­men of com­mer­cial­is­ing their dis­cov­er­ies and ex­per­tise.

All great com­pa­nies to­day, from Kono­suke Mat­sushita’s Pana­sonic, Got­tlieb Daimler and Carl Benz’s Mercedes to Bill Gate’s Mi­crosoft were once SMEs, with a start-up in some unknown lo­ca­tion be­fore they be­came some of the most trea­sured blue chips in var­i­ous stock ex­changes to­day.

Pro­pel­ling hu­man­ity for­ward, the founders of these es­teemed busi­nesses have changed the way peo­ple travel, com­mu­ni­cate, work and sim­ply how peo­ple live.

And in Malaysia, there are SMEs that have grown to be listed on Bursa’s Main Mar­ket, with some mak­ing the list of top 100 com­pa­nies in terms of mar­ket cap­i­tal­i­sa­tion.

But far from just stocks, bonds, war­rants and other fi­nan­cial in­stru­ments in play, SMEs, as the ba­sic build­ing block of any economies around the world, are con­tribut­ing to the society’s well-be­ing.

And The Star Busi­ness Award, or SOBA, will con­tinue to be there to recog­nise our most in­spir­ing SMEs.

Not just that, we will be watch­ing their ev­ery step, just like an as­pir­ing ath­lete who will fly our flag high on the in­ter­na­tional arena.

Af­ter all, it is an en­durance race with no end in sight for the en­tre­pre­neur.

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