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Like many other rapidly developing economies, South Africa looks to MSMEs to jumpstart a long and durable economic growth. The sector provides many budding and existing entrepreneurs, workers, webs of suppliers and distribution chains with the dynamism, challenges and economic opportunities. However, to release its full economic potentials, the sector requires the delivery of otherwise available but still inaccessible managerial, marketing, technical, financial, information, and institutional support services. One potent approach that can move these much needed managerial and technical assistance to the entrepreneurs doorsteps is industrial extension. Industrial extension fields industrial extension officers (or simply, IEOs) who are trained to perform such roles as: stimulants (they create or strengthen the need for and sustenance of change), catalysts (they introduce positive changes to MSME clients), and linkers (they provide diversified services without necessarily having all the expertise needed). Essentially, they act as a go-between the MSME clients and the support gateways including development banks, R&D institutes, universities, Teknicons, chamber of commerce, and from among the MSMEs themselves. Being facilitators and resource linkers, they foster effective two-way communication between the teeming entrepreneurs and the few support services. Likewise being gobetweens, the IEOs trigger a host of learning processes that eventually benefit both the sector and the support institutions.
This is now out-dated and part of a big book on Industrial Extension Tools published in South Africa by NTSIKA of the Department of Trade and Industry, SMEDANs counterpart institution. The processes presented here are still useful and applicable. It was written when internet was just starting to influence the job of the IEO. You are welcome to adapt the principles to the current tools (including internet, e.g., netbooks, skype, Facebook, websites, YouTube, Powerpoint, databases, etc.) available to you as one of the modern extension officers in Nigeria.
At the end of the day, the IEOs helps the MSMEs to help themselves. They help by actually reaching out to MSMEsby knocking at their doors. They assist them to explore their business pains and to resolve their inherent difficulties. They clarify conflicting issues and help them discover alternative ways of managing themselves and their situations. In doing so, the MSMEs can better decide what course of action (or behaviour) is useful for them. And since the MSMEs own both the problem and the solution, IEOs do not assist nor direct. They help but not take control. They support but not take action. In fact, they motivate the clients to take action. They consider the clients uniqueness and capacity to do whats best for their own recovery, development and empowerment as the most important concern in rendering the service. Indeed, they work through and with, rather than for their clients. They help MSMEs develop a new sense of competent autonomy, as they confront together a rapidly changing and increasingly becoming turbulent world of business.
THE CLIENTS
The MSME entrepreneurs (and their families) are individuals who are uniquely struggling to respond to the various factors and influences that affect their business performance. Despite the rich personal, educational, experience, tribal, and regional diversity, however, they share a number of important characteristics: They are much more than just entrepreneurs. They may be parents, village chiefs, religious leaders, metalworkers, furniture makers, healers, petty traders, etc. In these diverse roles, they participate in complex local religious, social, cultural and economic patterns and are subject to a wide range of demands besides running their own MSMEs. They are usually skilled and experienced. Despite their relatively low education base, they are experts in their own enterprises and their markets. They use whatever rudimentary technologies (e.g., cabinet-making, flower decor, casting, etc.) they have mustered over time. In the face of change, they are in transition between the traditional and the newer business practices. They are seldom aware of new technology and managerial developments. They have economic concerns. They participate in or are influenced by local and even national development concerns. But they seldom have the time to discuss these concerns with their co-entrepreneurs. Likewise, they also do not have anyone to discuss and examine these concerns in their own usually self-contained enterprises. For example, the decision to use or not use credit or even its sourcing beyond the local moneylenders in their townships can become agonizing and painful choices. They learn to survive on their own. Over time, they learn that carrying out the tradition is a way of life. Gradually, they lose the ability to contend with the new problems brought by accelerated change; particularly in technology. They experience a feeling of impotence amid rapid change. A few might express openness and
adaptability. But the majority, like their counterparts in agriculture, is really ambivalent to change.
information. This often causes receivables to mount. Failure to respond to customers needs can eventually lead to business failure. Lack of customer orientation may also be a sign of poor communication skills; inability to present ideas, converse, listen, understand, negotiate, correspond, or listen very well. Many MSMEs fear objective criticism and refuse to seek them out. Hence, they miss the opportunity to turn these criticisms into challenges that can improve and strengthen their MSMEs. 6. Prolonged use of one-person management style. After starting their enterprises and eventually becoming owners, managers and also workers, entrepreneur must try to build an organization as their enterprise become more complex. Trying to do it alone, wearing too many hats and refusing to delegate responsibilities or to build an internal working team will not only overburden the entrepreneur but also cap the growth possibilities. Sooner or later, the load will crush them with no one to fault but themselves. Doing it alone also prevent the MSME from building webs of support networks among their key suppliers, financial sources, or other MSMEs. Moreover, trying to do it alone could lead to unnecessary physical and mental stress that could in turn seriously damage decision-making competence. 7. Lack of technical competence. Many entrepreneurs started their MSMEs without sufficient technical preparations. They decided to learn on-the-job. However as their enterprises grow, most entrepreneurs are swarmed with tasks that could eventually swept learning on-the-job away. This could spell the difference between success and failure. Learning the technical aspects of the enterprise is an unending process. There are always new developments (in materials, technical processes, formulations, machinery and equipment including jigs, tools and fixtures, as well as new ways of doing things) that can seriously affect the products and processes used in the MSMEs. Learning on-the-job however, does not mean that entrepreneurs should be master craftsperson before they could go into business. 8. Absentee management. There are many factors that could deflect the entrepreneurs attention away from managing their MSMEs. One entrepreneur, for example, had a long period of profitable operation. Then, he went through a number of months of absentee management. Another entrepreneur was persuaded by his neighbors to act as a spokesperson for the township. He liked the job, which made him absent from his MSME. Still another entrepreneur became the chapter president of a Rotary Club that physically threw him out of the enterprise. Their MSME operations and performance gradually deteriorated. Financial records were neglected, they failed to meet creditor obligations, and ultimately their MSMEs failed. 9. Internal conflicts. The main cause of failures in many partnership MSMEs is the internal conflicts between the partners. Partners who fight with each other, make
allegations about various kinds of scandalous misconduct, manipulate expense accounts, and conduct secret negotiations for sales contracts are bound to destroy the MSMEs they manage. Another source of internal conflict is lack of balance in the entrepreneurs life. Neglecting family members, friends, or activities that lend meaning to life could contribute to ineffectiveness and inefficiencies. A balance life enriches the horizons of the entrepreneur as an individual and contributes more in building ones managerial competence. Overall, the economic costs of these MSME failures are high. But most of them can be avoided. The IEOs could be fielded in sufficient quantity to reach out and help the entrepreneurs deal with their growth pains. They can be trained to build trust, listen, understand, and communicate with the MSMEs nation-wide.
3. Strategic needs, i.e., diagnosing, problem-solving, business planning, teambuilding, management development, crisis management. Even if the methods used to probe them are informal and less systematic, the IEOs should at least have a general feel of their clients special interests and needs as this will guide them through the conduct of the extension cycle.
Step 1 - Exploring
The journey begins here. In this step, the IEOs will aim to develop friendly relationships and to explore the pains besetting their clients. 5. EVALUATING 2. UNDERSTANDING They should examine the landscape, gain familiarity with the territory, elicit information, listen, clarify, paraphrase, reinforce and try to reach a clear picture of the current situation, 4. PLANNING AND 3. LEARNING feed this back to the CHANGING clients and achieve reasonable agreements on what is really happening. Some basic questions (such as: Who is the real decision maker in the MSME? Why are the clients seeking extension services? Which problems will be handled first? What are the real issues problems, not symptoms? What have been done?) must be answered. Then the IEOs will explain what can and cannot be done, share the burden of dealing with the problems, the possible timing, fees, and expected deliverables. In this step, the IEOs will emphasize building trust and developing genuine partnerships over the task of delivering extension services. They should give as much attention as possible, listen with non critical acceptance, help clients to order their thoughts, and establish genuineness. Only then can they move on.
1. EXPLORING
Step 2 - Understanding
This step enables the IEOs to help their clients gain fresh angles and views on their problems. The problems can either be well-defined (i.e., cut operating costs by 30 percent, reduce the scrap rates from 20 to 3 percent) or ill-defined (i.e., use of plant diagnosis may be required). To achieve new understanding, they challenge their clients. They give direction, point out difficulties or weaknesses, share information, recognise latent inconsistencies, show their feelings and present their experiences. Essentially, they get their clients to think more clearly about what they are doing and
where are they going. In doing this step, IEOs (a) inquire, listen and record, (b) observe peoples feeling and constantly observe peoples feelings whether they are friends or foes, (c) use empathy, that is seeing events as others see them, and (d) seek involvement by avoiding solving the problems singlehandedly. Likewise, they perform various tasks involving diagnosis, needs analysis, fact-finding, and data gathering. Then, using appropriate data capture techniquesmost of which are contained in this Resource Bookthey define and re-define the problems and zero-in on the real ones. The IEOs should involve the clients at every step of the way.
Step 3 - Learning
Being essentially solution seeking, this is the most exciting part of the process. In this step, the IEOs and their clients jointly explore new ways of doing and managing MSME tasks. Hand-in-hand, they go through a series of analysis, synthesis, creative thinking, brainstorming, problem solving, decision making, goal setting, and planning exercises. They generate and consider many alternative solutions, assess each of them, select the best alternative and develop tentative plans. This step will only be completed if the IEOs clients (or by teams constituted for the purpose) have decided on the actions to be taken. But just before concluding this step, the IEOs should reflect whether their clients can live with solutions? They should also assess their clients capacity for change. And, they should determine their clients commitment to the solutions arrived at.
Step 5 - Evaluating
After some time, the IEO will go back to the clients to assess the results, verify the problems and solutions, and check the progress of the implementation plan. The IEO can reflect whether the client is better off as a result of the extension engagement. Can the client sustain the change introduced? Did the client really learned from the process. Did the clients capacity for self-analysis improved? This step insures that both the client and IEO that the solution fit the problem and are satisfied with the outcomes. Not all extension engagements follow this process. Experienced IEOs usually introduce some refinements depending on the need of their clients. For example, the GATHER method is a variation of the above process has been adapted for the industrial extension from the health sector.
GREET THE Introduce yourself and the extension services
CLIENT
Ensure confidentiality Discuss what you can and cannot do Ask the client for any problem besetting him/her Important: In this step, the IEO begins to establish rapport with the client ASK/ASSESS Inquire about the problems that they are currently facing Assess what s/he has done to solve the problem For new clients, obtain baseline data: Sales, Employment, History, etc. For old clients, ask the following: Ask if their situation has changed since the last visit Ask them if they have new concerns Inquire about any problem that they might have Important: Before moving to TELL, be sure that you know the clients objectives in dealing with the problems on-hand TELL Tell the client: What the options are and briefly discuss each one How does each option works Advantages and disadvantages Possible benefits and or side-effects Distribute materials Important points: Do not tell the client: options that are not related to their needs, information that have already been given. You can start this step by asking the client what they know about the option related to their needs and you fill in the gaps in knowledge HELP Ask the client if they have heard of anyone who have already successfully tried the options presented in the TELL phase Ask the client for potential problems that can be anticipated and resolved Ask the client if there is anything not fully understood, repeat the information as needed Important points: If the client cannot make a decision, ask them what additional information is needed EXPLAIN Explain the procedures for doing the option Explain warning signs, what they are and how to get more help Confirm the clients understanding of what has been said by asking to repeat what you have said in the clients own words Give the clients informational materials on the option chosen Important points: The difference between this step and the TELL step is, in this step you are explaining how to use the option the client had chosen. In the TELL step, you are telling the clients about all methods based on their needs RETURN/REFER Tell the client when you plan to return for follow-up or refer the client for other services not offered by your institution. Tell the client when or where to go for follow-up Tell the client about services that are available but you do not provide Give a referral note when needed. Adapted from AVSC International and the Department of Health, Philippines
EXTENSION STYLES
While the extension process is in progress, four major patterns can easily be identifiable. These patterns become visible when during the process, we either include or exclude the clients and while dealing with the problem, we may either be task or entrepreneur-focused.
Entrepreneur Focused
If the IEO is more concerned about the problem and its resolution and merely anticipates that the client will passively accept the solutions, then it is telling and not counselling. This assumes that the clients has insufficient know-how about the problem on-hand and can contribute very little towards their resolution. If the IEO includes the client but still mainly focused on the problem, then this is advising. Advising is applied in cases where the client is perceived to be able to contribute to resolving the problem. If the IEO excludes the client but still focused on their needs, then it is manipulating. Once the IEO becomes aware of this, then they should retreat as the client may have a very high capacity for self-help and uses the IEO as a mere extra hand. Finally, when the IEO is client focused and including the client as an equal in the process, then it is more likely to be counselling and extending. Counselling and extending is more likely to achieve more permanent change in behaviour and action. There is no one best style in dealing with MSME clients. Each style is appropriate for a specific situation. The IEO must be flexible in using each of them. The complexity of the problem and the clients degree of know-how influence the choice of the style. As such, the IEO should have an approach that fits their client. For example, below is an extension style applied by an IEO to an MSME client.
Steps Styles 1. Exploring 2. Understanding 3. Learning 4. Planning and Changing 5. Evaluating Telling Advising Manipulating Extending
In the above example, the IEO began with an extending style during the exploring step that began the engagement. Discovering that the client can actually contribute to the problem, the IEO speeded-up the engagement by shifting to the advising style while doing the second step. Moreover, the IEO applied the telling style in the learning step and the extending style in both the planning and changing as well as
evaluating steps. However, doing the extension cycle many times over is not the only task of the IEOs.
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6. Continuing Education. Nobody can educate the IEO better than themselves. Although they can upgrade themselves by drawing practical lessons from the engagements and self-studies, there is no substitute for formal education. Through its linkage with other service providers, the IEOs can create continuing education opportunities. Likewise, they can attend night school, some in their own vocational schools. The continuing education can become part of the IEOs reward system that permit them to take short-term courses, foreign fellowships, familairization visits, or even a masteral programme at subsidized rates. 7. Reporting and Administration. The IEOs have reporting and administration responsibilities. Reporting feedbacks the extension results to the clients and the service provider. Participating in staff meetings and completing monitoring sheets are reporting activities. The administrative responsibility includes: monthly time and activity planning, coaching new recruits, delivery of training and coaching services, etc. 8. Special Projects. Many occasions demand the IEOs involvement in special projects. Establishing cooperatives, conducting topical conferences, preparing proposals, administering foreign aid projects, implementing policy impact studies, etc. are some examples of special projects.
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cycle to:probe, check facts, increase understanding, show interest, build relationships, determine attitudes, and develop a particular mental frame. IEOs can effectively use verbal and non-verbal communication modes. In South Africa, before one qualifies for an IEO post, candidates need to take an application and a formal interview with NTSIKA or in any one of its qualified service providers. Moreover, the candidates need to participate in an Industrial Extension Course which NTSIKA periodically provides throughout the country via its network of service providers. The selection interviews and the IEO courses are not easy. It requires significant preparations and discipline.
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obligated to the client beyond his professional responsibilities. Regarding gifts and gratuities, he should not accept gifts having more than a nominal value. If they desire their clients products, they should buy them as if they are sold to employees. 4. Avoid Conflict of Interest. IEOs shall inform their clients of any interests, relationships, or any other circumstances which may impair their professional judgement or objectivity. If these happen, they should be able to refer the clients to their other IEO colleagues. Moreover, IEOs should refrain from giving any client proprietary information learned from previous clients without first obtaining the consent of the previous clients. 5. Respect Commitments. The IEOs credibility depends on the manner they fulfill their commitments. They should make no commitments, however small, without the intention of fulfilling them. They should be on time for their appointments and honour their promises. If they have to cancel appointments or back out from commitments, they must excuse themselves early and explain. 6. Maintain Confidentiality. While performing extension work, the IEOs will know their clients financial, marketing and technical positions. Such information is confidential and should not be disclosed to outsiders without permission. Distribution of reports containing confidential information should be approved in advance by the clients. Moreover, the IEO should never engage in idle gossip with a client about another clients affairs. They should cultivate a reputation for discretion so that entrepreneurs may allow him access to confidential data. 7. Criticize Positively. As an agent of change, IEOs recommendations often imply a criticism of the way things are currently done. Criticism, when awkwardly presented, incites defensive reactions endangering the extension process. The true professional comments objectively on an individuals actions and softens the intended criticism by sympathetic understanding. 8. Minimize Failure. Not all extension engagements lead to improvements. And there are many reasons why engagements fail. If after the situational analysis the IEO feels that failure is inevitable, he should discuss it immediately with the entrepreneur. By terminating the engagement early, both parties save time. 9. Plan for Replacement. Not helping entrepreneurs is as bad as overhelping them. Throughout the engagement, the extension officer should educate the entrepreneur and his staff to the point that they can operate without the IEOs guidance. This planning to be replaced approach is a key to professional extension work. 10. Minimize Length of Engagements. When IEOs overextend their engagements, they deprive other entrepreneur of their professional services. Although no hard and fast rule exists, they should never take longer than what the problem warrants. To be professional, an individual must have a group that adheres to a set of standards of professional conduct a code of ethics. A code is vital to a profession since it : (a) lists the ethical behaviour expected of each participant, (b) erases doubts arising from task performance, and (c) itemizes performance standards. Members of a professional extension organization may for, example, agree to : (a) keep the entrepreneurs interests above their own, (b) keep client information
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confidential, (c) accept no commissions/ fees directly or indirectly resulting from the engagement, (d) inform entrepreneur of any interests that might influence objectivity, (e) refrain from accepting engagements beyond their competence, and (f) refuse engagements that may lower the professions status.
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