Mindset: Corporate Management Vs SME Entrepreneur

Mindset: Corporate Management Vs SME Entrepreneur

Corporate Management

SME Entrepreneur

1) Studies demand for specific Products or Service including substitutes at global/ country level.

1) Tries to identify a product/service in vogue in a specific geography.

2) Try to work out a product delivery or service delivery model to meet the demand.

2) Identifies price level at which product may be sold for an appropriate quantity to generate revenues/contribution.

3) The model is tested for technical feasibility and scenario/sensitivity analysis to check if the competitive advantages are sustainable with respect to currently foreseen threats.

3) Works out a model or factory set up so that the product/service can be produced at cost lower than the targeted price to generate profits.

4) It looks to hedge unnecessary risks at project development & operation phases; outsource jobs to competitive players with requisite capabilities & experience or engage with SMEs for low value addition processes or where SME model may have advantages.

4) Causality of SME model is quality control, ethical standards (such as lack or ‘real’ guarantee/warranties, tax avoidance, avoiding payment for public utilities where possible like electricity, water etc., non-compliance with pollution control norms etc.). Is looking to In-source jobs for incremental profits without keeping in mind, competencies or risks.

5) Makes use of commercial Insurance to hedge risks and evaluate risks for all stages of business operations (avoiding unnecessary risks).

5) Often ventures into unchartered waters taking risks in uncelebrated manner. Generally sees insurance as expense rather than hedge instrument (necessary cost).

6) Is driven towards “Adding Value” for customers in a calibrated manner with interests of Shareholders in mind but taking into account, reaction or all other stakeholders such as local communities, government, customers, workers, suppliers, dealers etc.

6) While it begins generally with good intentions but often gets degenerated into being a profit machine for the business owner often due to competitive pressures but sometimes due to greed or just to keep up with the Joneses/peers.