In 1995 there was a report released, which was performed by David Carping, which looked into the various skills, or lack thereof, of managers in small businesses in Australia. The report depicted that, throughout Australia, there is a poor small business image. This refers to how small business and enterprise are viewed in the community and what is holding people back into entering into the small business world.
Primary points as to why there was a poor small business image include long hours, career development and stability, red tape/ overspent barriers, financial assistance and business growth and profitability. The Carping Inquiry (1995), made many recommendations but the main ones that concentrated on providing better social awareness and attitude were directly related to education and community awareness. It is also important to understand that small business is different to the big business in many areas but most importantly how it is managed and by whom.
A small business is defined by the Australian Bureau of Statistics (ABS, 201 2) as an active business with an Australian Business Number (BAN) which employs up to 1 9 employees and a tedium business employs up to 199 employees. These fall into the category of being Small and Medium Sized Enterprises (Seems). Small businesses are profoundly important to the Australian economy and growth. The Government’s job is to create the right environment for business to grow and to assist in this by reducing red tape and enhancing small business skillet (Parker, 2000).
One of the major differences of an SEEM to a large business is the role or duty of the owner/manager. In a SEEM the owner is generally an owner/manager and will take on various roles including planning, day-to-day management, finances, raising, marketing etc. This can also involve many hours of work, which could affect many things such as quality family time. Whereas, in larger firms, these roles are delegated to particular individuals, where they are able to concentrate on their designated roles. This in turn, improves the productivity of that business.
As defined by Peacock (1995) there are also many other skillets a small business manager should acquire and these include management and leadership abilities. This could include being able to think strategically, manage and lead various types of people/employees and manage and take on various asks. A small business, or any business, would need continuous proper management to see it succeed and grow. This includes constantly learning new skills as the business industry, and world continue to evolve.
On the opposite spectrum if the business is not managed properly and it experiences a rapid growth, this could become uncontrollable and also force the small business to fail. One avenue of assisting a manager in the stages of a business is by looking at the different stage models available. (Peacock, 1995 p. 78-80). One of the solutions that Carping (1995) had as a recommendation was that the government aka a more active role in the growth and development of start-up small businesses via the proper training and education.
The federal government have eventually put into place things such as the School to Work program, Vocational Education Training and business incentives such as the Enterprise Learning Program, which funded businesses and community organizations to assist in supporting young entrepreneurs with their start-up in small business. These address the issues that small business manager’s face in regards to having the knowledge and skills to perform their day-to-day duties efficiently and effectively n their entrepreneurial position.
The government have also taken an active role in addressing the ‘red tape’ issue, which many perceive as a deterrent for starting up a small business as the government had made it hard (Australian Government, 2014). One of the issues that small business managers face is finding the right employees for the appropriate wage. As Parker (2000) states, the larger firms in Australia have higher average weekly wages as opposed to small businesses and that the gap is actually increasing as time passes.
This is looked at negatively by the community and is something that has not changed nice the 1995 Carping Inquiry (Barren, 2010). A prospective employee would additionally look at a larger firm over a smaller one as there is generally room for growth, as in career development, and there is usually that job security also. With the economy the way it is job security is looked at very favorably. A point that Carping (1995) found was that there was a lack in financial assistance. Small business is usually self-funded either by savings or by a bank loan.
Applying for financial assistance via a bank can be a very daunting process as there is a lot of paperwork, planning and risk. Carping (1995) suggested that the government step in and assist in helping start-up businesses. Many cultures do not actually reward entrepreneurs and will actually try to prevent them from starting up (Parker, 2000), however Australia often have Government Grants, either local, state or federal, that can help with the financial start-up of a small business (Commonwealth of Australia, 2012).
These grants help the entrepreneur, individuals and communities alike. If communities and individuals are sighting that these small business ventures are going strong and getting the assistance hat is required then it will act as a chain reaction (Sims, 2002). In 2010 Professor Danny Samson prepared a report that revisited the Carping Inquiry and this tackled the 28 recommendations that Carping had put forward to addressing the image situation of small business (BIBS, 2011).
In summary a minority of the implementations of the recommendations were proven to be quite a success, however new barriers had emerged as well. In saying that 15 years between reports is a long time and things such as the internet have evolved out of sight, so of course new challenges will emerge. Because the internet has progressed so far in this day and age, a lot of businesses are on-line based and technologies have grown, however the BIBS (201 1, p. 29) report comments that Australians need to use technology to our advantage better.
Barren (2010) has said that “the internet had allowed more people start successful home businesses” but due to the poor public perception of small businesses “it is vital the federal Government did more to ensure the best and brightest were being attracted to small business”. A Roy Morgan survey, commissioned by Victoria University in 2010 enforced that the public perception on small business is still quite negative, however since 1995 a slight increase of 4% of people would suggest for their children to get into small business.
In saying this long hours and lack of financial support were still highly regarded as obstacles (Victoria University, 2010). Even though the study was performed 15 years later the community still viewed a small business as being predominately in retail and despite the complete negativity towards starting a small business, the same percentage considered Ewing your own boss and the independence as the major benefits of being in small business (Barren 2010). Overall, since the 1995 survey, very little has changed in regards to small business image and the factors affecting the community’s perception.
The issues that Australia still face include leadership, sustainable development, becoming and remaining innovative, continuous management education, the diversity of leaders and managers, the management of people, the global footprint of the business (global influences), risk and volatility and Australian demographics and culture (BIBS, 2011). In conclusion he public perception of entering into a small business has not changed greatly in the past 15 years. The community are still quite reserved in going down that path and as times change and the years go on so do a lot of other factors.
In saying this we need to be mindful, as small business owners, and adapt to the changing times and technology through the help from our local, state and Federal Governments by actively seeking out assistance. Managers need to remain vigilant whilst updating their knowledge and education continuously. Small businesses are so very important to the Australian economy and growth ND without a positive society attitude towards enterprise future generations may keep their distance in entering this field.
As Professor Barren (2010) had said “we need to do more to attract true entrepreneurs into small business because it will result in greater individual successes”.