By Mukesh Mathur
Having been a business leader in many corporate enterprises for three decades, eventually now as management consultant and trainer, I have come across many small and medium-sized enterprises (SMEs) that struggle with managing their business operations effectively. Their challenges include managing cash flows and resources, conceptualising new innovative business growth plans to adapting to the ever-changing business environment. Many of these SMEs successfully partner with business consulting firms who in turn work closely with SME clients to understand their unique challenges and opportunities, and develop strategies to help them achieve their goals.
Business consulting company plays critical role in helping SMEs address various challenges faced by them. I have summarised below many such areas where SMEs need help.
- Strategic Planning: Developing and refining strategic plans. This is true for start up business as well as existing ongoing business. It includes setting clear business objectives, identifying growth opportunities and bottlenecks, creating road map of actions for achieving these goals.
- Market Research: SMEs lack capability and resources for doing market research to understand market trends, customer needs, competitor analysis, which are necessary for taking informed decisions.
- Marketing & Sales: Consultant helps clients in forming marketing strategies, including online and offline advertising campaigns, social media presence, and form sales strategies. Effective Marketing and Sales strategies are backbone of successful business.
- Human Resources: Hiring and retaining good talent is often challenging for SMEs. Consultants can assist with HR strategies, including recruitment, training, and performance management. This includes setting up motivational tools to keep human resources in top performing form and in minimizing attrition.
- Technology integration: In the digital age, technology is crucial tool and enabler for business success. Consultants help SMEs choose and implement appropriate software and systems to improve their operations and customer experience and have right enablement to achieve business success. Consulting company is equipped to evaluate various technology alternatives and select most cost effective options.
- Financial Management: Managing finances is a common challenge for SMEs. Business consultants help them with different aspects of financial management, including budgeting, cash flow management, financial forecasting, to ensure financial stability.
- Operational Efficiency: Consultants can set up / analyze business processes and recommend improvements. This can lead to cost savings, increased productivity, and better overall operational efficiency.
- Innovation and Product Development: Business Consultants through their experience and expertise help MSEs with innovative strategies and new product development to get competitive advantage in markets.
- Regulatory Compliance: Consultant helps SMEs ensure compliance to various statutory regulations, which are important hygiene factors. Non-compliance can result in serious financial and operational penalties that SMEs can ill afford.
- Exports and International Expansion: Depending on client’s business, exports / international expansion poses a daunting and necessary objective to achieve. It requires specific knowledge about market trends, customer preferences and behaviour, besides knowledge of regulatory compliances required in international markets. SMEs lack this knowledge and will need help of experts available in business consultancies.
- Succession Planning: For family owned SMEs, business consultant helps client manage succession and smooth handover of ownership and leadership from owners to either other family members or professional managers. In corporate India, succession planning activity helped by consultants is increasing at a rapid pace.
SMEs need partnership of Business Consulting company to navigate the complex business environment, fast changing customer expectations, overcome challenges in strategic manner, and achieve sustainable growth and profitability. I recommend to my clients to do deep dive into spectrum of unique business challenges – both short term and long term – and their expectations from consulting company, and match those with expertise and experience available with consulting company, and take an informed decision on selecting right partner who will be cost effective for SME client.
Partnership between SME and Business Consulting is like a “marriage”; to maximize the effectiveness of outcomes of this partnership, it is essential for both parties to
- establish clear expectations,
- maintain open communication, and
- work together to address the specific challenges and opportunities.
Success often depends on the quality of the relationship and the degree of alignment between the consultant’s expertise and the needs of SMEs.
I have plethora of case studies of successful interventions by business consulting company in addressing specific problem areas, and would be happy to discuss with those of you interested on one on one basis. MSEs who partnered with business consulting companies have been in diverse business – manufacturing / sales and distribution / education / consumer products / industrial products / services business / etc. Business challenges include one or more of these –
- declining profitability with eroding market share,
- increasing manufacturing and marketing and sales costs,
- Inefficiencies in manufacturing processes, lack of inventory control leading to increased costs and delivery time,
- Market Shift, changing customer expectations, entry of new products and services.
- Entry of new competitors using newer technologies and innovative marketing strategies.
After a thorough study of SME clients’ SWOT (Strengths, Weaknesses, Opportunities and Threats) and financial, marketing and sales data, and after rounds of strategy discussions with leadership of the client company, Consulting company successfully implement number of interventions which I have described above in list of 11 potential interventions, and achieved improvements and addressed most challenges in significant way including profitability, market share, employee motivational levels, customer service level, etc.
(The Author is Mukesh Mathur, Senior Partner, BOD Consulting, and the views expressed in this article are his own)