a business started is both a stressul and afnancially challenging exercise. Even i onedoes get venture capital to ease the burden o fnance, the chances o it being a success areless than 30%. In such a scenario, the mostprudent thing to do is to be conservative –test the waters and get a sense o the marketbeore blowing every dirham o your savingson a business that was doomed beore it waseven conceived.There are o course many reasons why abusiness alls at in its early stages: the tim-ing was wrong, fnances dried up, lack o ex-perience, the wrong market. Statistics show that entrepreneurs oten choose the marketsin which businesses are most likely to go un-der; they ail to take the actions that researchshows help businesses to survive. Academicresearch shows that putting in place careulfnancial controls, emphasising marketingplans and writing a business plan increasethe odds that a new business will survive, yetmany ounders ail on all three counts.
The Power of Small
Bill McDermott, the Co-CEO o Germanenterprise sotware provider SAP, spoke to
about start-ups and small- tomedium-sized enterprises, and whether hisorganisation was only ater the big fsh oralso had a special ocus on the tadpoles. Hebelieves he knows how small businesses canhave a better chance o survival.“We are a big believer in the power and value o ‘small’,” said McDermott. “Sixty-fvepercent o our customers are small. Thesebusinesses are the economic engine o the world – it’s where intellectual property ex-ists and it’s where jobs will be created. Butone o the learnings we heard at the [WorldEconomic Forum Annual Meeting] in Davosearlier this year was that the number oneroot cause o small businesses not scalingand ultimately not succeeding is that they enter into the market without systems thatcan support their business model.“We have come up with a break-throughsolution or SMEs called Business One, which runs on our proprietary platormHANA. It can also be provisioned to a cloudenvironment, so it can be up and running in amatter o hours. It’s extremely easy to installand it’s very low-cost. Many o our custom-ers might have only a hal-dozen employeesand they are running this piece o sotware,”he added.I SAP is innovating or small businesses with applications like Business One, thenit is certainly collaborating with others todo the same. The winners o “The Power o Small: Entrepreneurs Strengthening LocalEconomies”, a global competition jointly sponsored by SAP and NGO Ashoka, wereannounced last month. The competition at-tracted 370 entries rom 69 countries.The our winning entries, selected by theChangemakers online community, repre-sent the most innovative strategies to helpemerging entrepreneurs and small busi-nesses grow and thrive in underserved com-munities. The winners received a compre-hensive capital, technology and promotionpackage rom SAP – including a cash prize o $10,000 (QR36,400) and a technology dona-tion to optimise perormance and scale upoperations.One o the winners, MySot, said thatsmall businesses need IT just as much as thebig ones. For the price o a meal at McDon-
a bigbelieverin Small
how many dedicated, not-for-profit agencies are failing to develop functional schemesto help entrepreneurs turn their ideas into revenue-generating businesses? maybe that’stheir problem – they’re not in it to make money. however, some corporations are investingbillions to provide sustainable solutions for these businesses. the co-ceo of sap, billmcdermott, explains how these small businesses are playing a big part in its core strategy.