4. Running a business Expected or Experienced Problems

4. Running a business – Expected or Experienced Problems

Key findings: ● The families to which the young would-be entrepreneurs belong approve of their going to business, so objections from the family, which is an important factor to consider in Philippine culture, will not be a problem. ● The problems which weighed heavily in most respondents were those related to business management competencies, such as having a clear strategy, managing change, costs, taking over entrepreneurial functions, conflict management, digital transformation, and marketing. ● The problems cited were those that could be addressed in a competency training program, designed precisely to equip the youth to address those competencies they find important.

Respondents were made to rate the weight of 19 problems they either experienced or expected to experience in business. The rating scale of low, moderate and high were translated numerically as 1, 2, 3 which were then used to multiply the response frequencies obtained from the items. Chart 8 below shows the spread of scores on the different problems, and Chart 9 next page shows the weighted average of each problem across respondents.

Chart 8. Weight of Expected /Experienced Problems

The weighted averages found for each of the 19 items on the list of problems, presented on Chart 9 below, shows that the problems in which respondents rated their experiences as mostly high were those related to business management competencies. These competencies were on having a clear strategy, managing change, costs, taking over entrepreneurial functions, conflict management, digital transformation, and marketing.

Problems experienced with external blocks had to do with the intertwining of business and relational needs, as well as networking skills with government. On the whole, this set of problems did not weight as much as problems categorized under business management competencies.

Type of Problem

Competency Blocks 1. I lack the skills and knowledge to manage the business

Average Rating *

2.22 2. I'm lacking a clear business strategy 2.15 3. It is difficult to manage the changes that business process is requiring 2.15 4. Managing costs and calculating the prices is challenge for me 2.13 5. I am not able to take over all the functions that the entrepreneur need to 2.12 6. I do not have the technical knowledge about starting or running some 2.08 business 7. Managing possible conflicts resulting from the business process 2.08 8. I'm not well prepared for the digital transformation of doing (smart) business 2.05 9. I am not yet ready and well prepared to run the business 2.02 10. It is hard to recruit and grow the human resources well 2.02 11. The process of establishing, running and expansion of business is not clear to 2.02 me 12. The business lacks the organization and division of tasks 1.95 13. Financial aspects of managing a business is not my thing 1.93 14. Selling process is exhausting me the most 1.88 External Blocks 15. Family and business matters are complex and intertwined 2.08 16. I'm facing business related issues that I cannot manage and discuss with 1.98 others 17. Starting and running a business is very demanding in terms of bureaucracy 1.88 18. The process of entrepreneurship is very demanding in terms of family/friends 1.80 relations 19. Family does not accept me as entrepreneur 1.52 Other (please specify): 1.48

* Ratings on Types of Problems : 1- Low, 2=Moderate, 3=High for describing respondent’s situation

Chart 9. Classification of Problems Expected or Experienced by Respondents

5. Importance of skills requirements associated with running a business

Key findings: ● On the above competencies, response patterns showed that the respondents viewed all listed competencies from high to extremely high in importance ● In all the listed competencies, only about 8% saw the skills as “not”or “low in importance.

To gather insight on this category, participants were asked to rate the importance of the following skills for running an enterprise. • Entrepreneurial competencies • Ideation competencies • Marketing competencies: ensuring getting paid by clients • Organization and production competencies • Financial competencies • Business planning

Entrepreneurial competencies - One can see from Chart 10 that the set of entrepreneurial skills (namely, identification of Personal Entrepreneurial Competencies, knowing how to manage and calculate risk, accepting responsibility, negotiating and communicating in a professional manner, and knowing how to make decisions), were all seen as between high to extremely high in importance by over half of the sixty respondents.

Chart 10. Level of Importance of Entrepreneurial Competencies

LEVEL OF IMPORTANCE ENTREPRENEURIAL COMPETENCIES

Ideation competencies - These include the skills of generation, assessment and selection of business idea, making smart goals, and knowing how to match ideas with personal competencies. More than half of the respondents viewed this skill set as between high to extremely high in importance (See Chart 11) for running a business.

Chart 11. Level of Importance of Ideation Competencies

Marketing competencies - The picture shown by the data on Chart 12 shows that the view on the importance of marketing competencies is about the same as in the other listed competencies. The skills is seen as between high to extremely high in importance.

Chart 12. Level of Importance Of Marketing Competencies

Organization and production competencies - These refer to planning and describing the production process flow, time management, organizing the work flow, and cost calculation and predicition. All in the skill set were seen by nearly 100% (57 to 58 out 60) respondents as between high to extremely high in importance.

LEVEL OF IMPORTANCE OF MARKETING COMPETENCIES

Chart 13. Importance of Organization and Production Competencies

Financial competencies - This is another competency area which was found by respondents to be highly important. These skills included: ability to read and implement pricing strategies, understand profit and loss statements, use cash flow statement for management purposes, read and understand a balance sheet, understand profitability ratios, and use financial calculations for business purposes.

Chart 14. Level of Importance Of Financial Competencies

Business planning - Competency in business planning was seen as high to extremely high in importance. Respondents understood this for preparing the business plan, and to undertake the presentation of it in front of donors, clients, and employees.

IMPORTAIMPO NCE OFRTANCE ORGANIZATION AND PROF FINANCIAL COMPETODUCENCIET SION

Not Important Low Importance COMode M rate PETENImportance CIESHigh Importance Extremely High Importance