SME Mag_Issue 2.pdf - MTN Business

Start soaringIn the second of a series of articles on SME, André Wiesner chats to those in the know abouthow to take your business to the next logical levelHow do you grow a small business? On the face of it, theanswer seems obvious: keep on doing what you’vebeen doing since start-up – just do a dozen, a hundredor thousand times more of it. The truth is that scaling up anenterprise is more than a matter of taking what you have andmaking it bigger. Getting your SME to break into a gallop, findits wings, lift off and soar entails an evolutionary leap in howyou do business. It involves a change in nature.The first change is that, if you want more numbers inyour bank account, you will need more people in your life:more customers, certainly, but also more staff and outsideassociates. Whether you’re working solo, operating a mom‘n pop establishment, or leading a comparatively small staffcontingent, you have been the centre of gravity holding thebusiness together. Now, as you embark on the growth phase,your aim is to boost long-range profitability – to escalaterevenue yet keep costs down. The thing is, you can’t do it alone.Or, as MTN’s Mellisa Naidoo puts it, “The small businesschanges because increasingly you have to rely on otherpeople and start developing relationships out there.”The second change is the flip-side of the first. To grow, youneed to be interconnected with more and more people; forthis to happen, the business has to be less and less aboutwith your SMEyou. You’re the engine of your business, its driving force – andperhaps also its accountant, receptionist, chief cook andbottle washer, and more. But growth requires that you rethinkhow you divide up the labour in your business; in particular,you want your time freed so you can apply your skills andleadership where they’ll bring the shrewdest benefits.What this means is that you’re re-evaluating not only theshape of the organisation but your role within it. It mighteven mean redefining your core product or service offering.For instance, you could be making a tidy income from yourhighly personalised work as a web designer, yet the fact is yourpotential for growth is restricted – for the simple reason thatthere are only so many websites you yourself can craft in a givenperiod. Don’t be the product. A business isn’t scalable if this is so.As the saying goes, aim to work on the business, not in it.Think of it less as yourself than a second self, a separate entityyou can nurture, guide and steer in appropriate directions. Inshort, step back from your immersion in it, see it precisely as abusiness, and consider the following growth steps you can take:Strengthen your organisationStrengthen the organisation’s capacity by hiring oroutsourcing people to do things you can’t do, or to supportyou in doing the things you can. But if you’re wary about thecost and hassle of equipping new staff with workstationsand miles of clunky, knotted cables for their Internet link-ups,think again.“The beauty of our business,” says Victor Rakhale, MTN’sgeneral manager of Direct Sales, “is that we offer a mobilewireless platform for accessing the Internet and email. Thetechnology is reliable and versatile and makes scaling up easyand cost-effective. If you have an account with us, just addmore staff to it as you grow and we’ll deliver the SIM cards toget your staff up and running.“At a certain point in your growth, it’s a good idea to acquire amyMTN APN, or Access Point Name. It’s a secure connection thatenables staff to access the Internet and email; as a company, youbuy one packet of data and let individuals eat into it.”An additional service is MTN Fax2Email. Safe, paperlessand free to MTN clients, it allows staff to receive faxes fromsuppliers and others in a convenient email format.“Technology is critical in making business more efficient,”Rakhale says. “For example, most SMEs will tell you half theproblem is finding customers; the other half is getting paidby them. Part of the problem is that those SMEs rely onrudimentary systems for generating invoices and receipts.A major focus should be acquiring the right technology sothat you can track accounts and follow up on delinquentcustomers, as well as manage staff payrolls.”Overall, you should develop clear, standardised systemsand processes. The idea is that you ought to be able to trainnew staff quickly – or step out and have the organisationfunction smoothly and consistently by itself in your absence.Enrich your product or serviceBuilding staff and technical capacity costs money, so youneed to devise a financial strategy for funding your growth.This could include taking a loan or, more sustainably, seekingto generate a dependable flow of repeat-business fromcustomers by entering into long-term contracts with them.A common problem is that, as SMEs expand, they neglectpre-existing customers or battle to give them the samequality of support as before. But as Nomalanga Nkosi, MTN’sgeneral manager of Business Marketing, explains, the goal isboth to acquire new customers, as well as harness existingones, whether by eliciting referrals or inducing them toincrease their spending with you.Achieving that goal, she says, takes “a 360-degreeunderstanding” of your market, an eye for opportunity,and flexibility in adapting or repositioning your product orservice. Instead of regarding it in isolation as a stand-aloneitem, picture it from your customers’ perspective, see it as partof an array of interlinked products and services that couldmeet their needs, and bundle your offering into a one-stopshop,bouquet solution.growDoing so involves forming strategic partnerships withother businesses possessing skills that complement orsynergise with yours. Together, you promote one another’swares and collaborate on an ongoing or per-project basis, anarrangement that is advantageous when pitching for work ordealing with the unhappy good luck of a business opportunitytoo huge or complex for you to service individually.But when bringing in external associates to work withyou, take care that they don’t wind up dragging yourbrand through the mud and you into court. A service levelagreement (SLA) should be in place to outline your mutualexpectations, and although customisable SLA templates areavailable online, it’s best to seek legal advice. MTN BizAssistcan help you locate attorneys in your area.Multiply your customer connectionsYou strengthen the organisation’s capabilities and enrich yourproduct or service; the next step is to expand your marketreach by going out where your customers are to let themknow what you’re about and transact with them. This entailsa drive to widen and bolster your sales channels, and couldinclude opening new shopfronts or enlarging a direct-salesteam. Additionally, you might consider using resellers – thirdpartyagents who, in the Tupperware tradition, sell goods onyour behalf – or franchising your business model to others if itis distinctive and can be replicated.What’s beyond question is that your business must be online.A lively, interactive website for engaging with customers isby now a necessity, so you should also be using social mediasuch as Facebook and Twitter. Indeed, it’s an exciting time foryou to tap into the ever-growing world of digital connectivity,be it placing banner adverts on the Web or harnessing mobileplatforms like MTN Y’ello SMS, a bulk-messaging facility forsending out reminders, promotions and more.All of these measures build your brand; to convertthis raised awareness into cyberspace sales, you need toimplement an e-commerce solution that combines a userfriendlywebsite with fast, reliable logistical support for yourwarehousing and delivery needs. (See below for details.)“Make sure that you innovate and stay abreast of what’shappening with technology,” says MTN’s Sifiso Khumalo.“We are increasingly moving into a paperless environment,and it’s essential that you as a SME utilise that space to yourmaximum benefit.”For more info on logistics or e-commerce,see these useful linksE-commerce: www.shopdirect.co.za; www.enginuity.co.za;www.payfast.co.za; www.paypal.com/zaLogistics: www.value.co.za/express.aspx; www.rtt.co.za/www.dawnwing.co.za; www.dhl.co.za/en.html12 13