MANY dream of starting their own business, but not many know how to run, develop and sustain the business.
To lead and encourage small and medium enterprises (SMEs) to soar beyond boundaries, Star Media Group’s Star Outstanding Business Awards (SOBA) held an informative learning series at Menara Star, Petaling Jaya.
At the event, Ambank Group Business Banking managing director Christopher Yap revealed that 80% of businesses failed because of poor internal management while 20% of failures were caused by external challenges.
“In the business scene, there will be a hiccup every now and then that is out of our control. But often, companies will be able to absorb the impact and weather the storm.
“However, internal factors such as fund leakages, poor management and the lack of knowledge of the business are the biggest causes of failed businesses.
“Many business owners make mistakes such as using their funds on investments other than what they were meant for, thinking that it would generate more profit. Some also lack knowledge and strategy to penetrate the international market.
“Other issues include wrong structuring and poor sustainability.
“One of the most common mistakes SMEs make is having their spouse as the minority shareholder and guarantor because if anything happens to the owner, the spouse would have to take over and their lack of experience and knowledge would lead to weak management.
“My advice to SMEs is to not execute actions too fast and too soon. Take your time, learn, think things through and always have a plan. To know why companies fail is very important for us to not make the same mistake and expand,” Yap said.
Credit Guarantee Corporation (CGC) Marketing and Sales senior vice-president Wong Keet Loong shared that SMEs nowadays had more financing opportunities.
“These days, SMEs have easy access to digital financial services such as equity crowdfunding and peer-to-peer lending other than banking services. However, you must remember that the fate of your business depends on how you utilise your funds.
“With the digital platform and solutions easily available to us, SMEs should make use of them to expand business and potentially, go abroad and penetrate the international market because the world is your market,” Wong said.
Meanwhile, Malaysia External Trade Development Corporation (Matrade) eBusiness and IT division director Raja Nor Zihan Raja Mohsin shared the benefits of its eTrade programme to help companies accelerate exports through participation in leading international e-marketplace.
A company is only as great as the people who embody the mission of the organisation.
This is why it is crucial to manage talents the right way and make them feel part of the company, Human Resource Development Fund National Human Resource Centre director Mohd Sidki Hasan said.
“Many SMEs overlook the importance of having a formal recruitment process to attract the best talents. Without placing talented people suitable for specific jobs, employees would not be able to work effectively, thus affecting a company’s progress.
“Beside hiring the best talent, it’s also important to share the big picture of the business, get them involved and ensure your employees receive the necessary upskilling and reskilling they need to further develop and grow in the company,” he stressed.
Training sessions no longer need to be restricted to a classroom setting in this day and age.
“With hundreds of free or paid courses available online, employees can enhance their skills at their own pace anytime, anywhere digitally.
“This also gives them the choice of learning according to their interest and the opportunity to improve and understand more about the job. Only then can they expand and help your company prosper,” Digi Telecommunications chief corporate affairs and strategy officer Eugene Teh said.
SOBA, organised by Star Media Group, aims to recognise up-and-coming enterprises and their contributions to the Malaysian economy.
In line with the Government’s commitment to develop homegrown enterprises, SOBA seeks to inspire and encourage local businesses to promote Malaysia and showcase its products and services to the world.