Everyone is managing a Small Business: Diagnose Yourself

Brief: Whether or not we own a business, we all own our work and so run a small enterprise which is like an organisation made of relevant partners. We are often faced with a block on how to transform our enterprise. Though what needs to be transformed, and what it needs to be transformed to, may still be clear, but the complexities of change management make it absolutely tedious to effect change in our enterprises. This article lays the groundwork for 20 simple tools that can be applied in the work we do, each of which will be discussed in subsequent posts. The implementations vary in complexity from simple to advanced, and focus on different areas. A simple method for measuring maturity of our enterprise in different domains forms the first tool ‘Diagnose yourself’, and has been provided provided in this article, to help reader look for areas where implementation is mostly needed to them.

Takeaway Ideas:

  • Total Quality Management
  • 5X4 Matrix of 20 tools for improvement
  • Self Diagnosis Questionnaire

“Change is the only constant.”

This statement by the pre-Socratic Ancient Philosopher Heraclitus has stood the test of time. Change, internal or external, has always been central theme in everything we do. At times change appears faster, sometimes it looks almost stagnant, but nonetheless change continues, and we need to adapt to the dynamic environment accordingly. Management helps us deal with such change. Keep in mind, whether or not you own a business, you still own an enterprise, as your work is your enterprise, you own it, and the basics of management apply to it just as much as they apply to a large business. The people associated with our enterprise, make our organisation, and it is important that we think so, because it helps us appreciate the econsystem we are dependent on, which may be itself in a state of rapid change.

Take the case of India which I will henceforth focus on, but the lessons of which can be applied to any developing country. India, currently is going through an exciting phase in its history. The accelerated growth that India has seen over the past few decades, has been unprecedented. Moreover the change in supporting technologies and systems has also been unparalleled. India had just 5 million mobile subscribers in 2000. The number has increased 140 times to a staggering 700 million by 2010. This is the pace of change that an Indian has to deal with. Old understanding of entrepreneurship and management thus needs a constant overhaul time and again. To thrive in at our small enterprise, we need to get in sync with this fast paced environment.

The typical management style of small enterprises in India has been organic. Tolerances have been large and management styles have been unstructured. It is typical for any environement where there is steady income and greater complacency. If we strive excellence, in present environment there is no room for complacency any more. The level of engagement needed today to run an enterprise is much more than it was needed before. Thus there is a need for automating many of these management interventions.

Like Henry Ford automated his car manufacturing, to take care of the room for demand, there is a need for putting systems in place that can manage various work related issues themselves.

The organic workstyle that many of us have adapted is still very relevant, but it is important that there is sufficient efficiency in our work by bringing objectivity, so that there is space for issues that really need subjective considerations.

Often when we go for a major change in our work, there is a focus on BIG leaps. Like an SME would go for technologies like automation and capacity expansion. Owing to the large investment and the large gestation period required to reach break even many choose or delay to take this leap. In this article the apporach to change is different. It works by focusing on small continuous improvements in the existing systems rather than a major overhaul at once. This makes transition easier to undertake and implement. Total Quality Management with characteristics relevant for developing countries is the quality philosophy that can be the very effective for present environment.

Total Quality Management is a Japanese led concept, that has found great success across enterprises of all sizes. But societies like Japan or Korea differ markedly from cultures like India which tends to be less collectivistic. Indian ethos have particular characteristics that need to be taken in into consideration, and TQM principles need to be modified accordingly. Thus TQM is a reference, using which a management philosophy can be developed that is suitable for enterprises in developing countries. For India, emphasis needs to be given on creating avenues for high growth potential of all individuals and organisations associated of our enterprises. The complexity of tasks handled by each individual can be higher and diverse, so that there is minimization of competition between people and greater space for interdependent cooperation. Procedures need to have inbuilt flexibility, so that there is room for creative and subjective interventions that may differ from the prescribed methodologies. Development of a serving-our-customer mindset, first within ourselves and later in the people in our organisation who are associated with our enterprise is critical. All the tools that have been suggested keep customer service as the primary objective of an enterprise.

The guiding philosophy emphasized in this article is given below.

Leadership, Customer, People, Operations and Resources, are identified to be five key areas where enterprises need to be on top of the game. Each of these areas need to in-turn improve on four action stages of Know, Plan, Act and Enhance.

The 5X4 matrix thus provide for the 20 tools which will be elaborated in later posts. The key themes of these 20 tools is summarised below.

L1: Leadership/Know: Diagnose Yourself

Diagnosis of the self, our enterprise and our organisation (our econsystem), is the fist step towards agency so that we are responsive, not reactive to change.

Each of the other 19 tools contain a number of interventions that can be applied in the work we do. The effectiveness of the interventions are such that they are made specifically for an organisation of a particular maturity level. For example, application of marketing planning techniques like simplified QFD for product development maybe apt for an organisation that already has clear customer focus, but in organizations where there is no sensitisation to the suprimacy of customer delight, QFD analysis may be just a meaningless managerial exercise. In such nascent organisations, establishing meaningful communication channels with customers will be more effective tool.

For identifying maturity level of organisation, a brief questionnaire for quick assessment is given.

Based on the diagnosis, organisations can be provided a maturity index.

Nascent organisations are those that are uninitiated in the quality journey.

Brittle organisations are those that have quality systems in place, but primary quality focus is not there.

Potential organisations are those that are initiated in their quality journey, and show scope for significan improvement in organisational commitment towards management values.

Strong organisations are those that have robust systems in place and have developed a quality conscious environement for themselves.

Leader organisations are those that act as benchmarks for world class quality and systems.

This questionnarie is an important self starter for self awareness, and the essential first step in leadership, for knowing where we stand in our journey.

An analysis of the questionnaire itself can provide valuable insights to us of the areas of potential improvement.

The later posts shall further elaborate of other 19 techniques…

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