‘dium enterprises (SMEs) that represent some 90% of local enterprises have contributed a lot to thr economic development. However, they are facing many difficulties ‘seatring loans from state banks, get ‘ug access to new technologies and heeessary information, competing ‘aginst foreign counterparts in both Gomestic and foreign markets and improving their managerial and ‘echnical skills OF these difficulties, the poor managerial skills could be improved by securing help from the education ard advisory services. The advisory | sarvieo, however, has just come into bing in Vietnam in reeent years and ‘most SMBs haven" got into the habit fof employing this service to. solve their problems, This article aims feramining SMES’ attitude towards ‘and their need for the advisory serv- jes, what difficulties SMBs aro facing and what the advisory service could dd for these SMEs, especially ones in HeMc. Es ‘small and mo- DEMAND FOR AND USE OF | MANAGEMENT CONSULTING 2s: SERVICE OF SMALL AND MEDIUM ENTERPRISES = | Information: "The following ques ions. should be. an- when facing. diffical~ Yee? Doee the SME pay attention to con- sulting organizations fand consulting serv ce? Such information could come from ac: by LE NGUYEN HAU & NGUYEN TH] TAM GIAO “sinttnces, | com 20, 1908 stipulation that an SME is Tegal capital of | VNDS _ billion (U158387,600) and alabor force of 200 See persons, "The concept of management con- sulting applied in this resoarch is a combination of ideas. suggested by Flt Steal and Larry Greiner —Rob- ert Molzger: the management con- sulting isa special professional field, ‘helping organizations gan tions in which consultants aren't re- sponsible for implementing {improvements if this isn't included in the contract. "To moet the research objective, ‘the subject is made into the following buying behavior model and attitade model Management consulting is also # servico supplied to SMES as fustomers. ‘This research wants to study decisions made by SMEs in the ‘mercial soureo, public ‘Soures and. experi Consultante ae. very intrest fn information sought by SMEs and clfcts of the information on SMI’ on nnd thincing way. “Bnuimate: the SME is aware of the consulting service and wants to huy i when aocessary the SME wil choose suitable consulting organiza- tions or experts based on Fcogaltion and information it gathered. "This information will help con- sullants realize what facto the SMEYS process of estimating and Shoosing the consulting organiza: ‘ons and experts. ™ Decision: After estimate and choosing, the SME will decide what Consulting service to buy and what fvice to look fo. Tn fact, fom rel- {aing one's need to making docision sa long proc sultante to accelerate this process is of great importance and. could pre- ‘vent the SME ffom delaying or can Seling its docsion- making process ‘After-uying behavior” SME's behavior and attitude afar buying affect ‘Efforts from con- Recognition information Estimate Decision Behavior L—+ 1 \ | % ¥ ¥ ¥ ¥ [SMEs need iorand] [are swEsineresieg] [Has ne SME over ow dd 0 feoogoton of mane inthe uso of man Used he manage: | jae he management SGerentconsutg | lagementconating?| | ‘mencconeung? | Sonsatig ahve? 1. Research mode! Firstly, ive necessary to define what an SMB is and what the man- ‘agement consulting serviee is, ‘Official document 681/CP- KTN issued hy the Govoramont on June following stages: “Recognition: Necessary informa- tion should be gathorod in order to the consulting servies is also tant and worth studying because it will affect its future need for this make SMEs learn of management service. consulting service and feel a need for this service. por. ‘Tho SME's degree of satisfaction after buying the service is the main feedback about prestige and future of EDR 21consulting organizations because the foedback could help consultants im- prove their service. In addition, con- Fultants should estimate the SME's need for tho sorvice and kinds of service they may need in the future "The process from recognition to decision’ and realization of future need is @ continuous one that. ine ludes well-related stages, To under~ Stand need and attitude of SMEs, we should study stages. relations between 2, Methods of collecting and ana- lyzing data ‘To collect necessary data, wo us ‘4 quostionnaire including 24 ques- tions about the SME's use of consult ing service, Some of these questions also require respondents to give ‘opinions about difficulties they are facing and kinds of management con- sulting eervico they approve. The re- Spondents ean choose from five an- swers varying from “Absolutely disagree” to “absolutely agree" Other questions ask about their plans for the future, their nood for the management consulting and ‘opinions about this service in Viet- Table 1: Stratification of SMES show that most SMEs are facing dif- ficulties caused by rules and regulations, shortage of information fand narrosting market share, Most SMEs have made plans to expand their business in the future ‘and main dificulties aro: shortage of capital (68.1%) and shortage of infor- ‘mation (20.8%). Most SMEs, bow- fever, didn't think of help from man- fagement consulting and decided to roeruit well-trained personnal and ‘work out solutions on their own. ’, Opinions about the manage- ment consulting: ‘Results of factor analyses show that there are four groups of opinion about the management consulting. Statistics arranged into the Likert soale show that SMEs aro of either the opinion that its a waste of time fand money to use the management consulting (average agreement with this is 406 per 5.0 points) or the opinion that the management con- sulting is necessary to SMEs (3.82/ 5.0 points). Contrarily, many SMEs didn't agroo with the following opin- fons: IVs easy to find good consult- ‘ants (2.37 points) and information ‘can be kept secrot (28 points). ‘SMEs ___ By ewes By opraton| State-run enterprises |Manulacturing enterprises ees) 465% “Trading and cowviee entrpiaos (e129) 34%) (on-state enterprises include private, jlnt stock, tnited companies, Soutee: UNIDG reper, January 199 Respondents are 132 managers and/or owners of SMEs in HCMC. ‘They are choson according to strati- fied sampling method. ‘Method ‘of analyzing data in clude descriptive analysis and multi- variable analysis 3, Results ‘Of 250 questionnaires issued, 150 were sent. back but 16 of them ‘were unsuited, From 134 appropriate fonea ressived, we gathored the fol- lowing data, ‘a. SMBs’ situation: jeulties facing SMEs could be divided into four groups. Con: It. fants, by examining these groups and relations betwoen factors in each froups, could find out way to deal Wwith them, Analyses of each factor i) ‘Moat SMEs think that: Vietnam- ese consultants aren't good enough (68.1%), and the sorvice isn't attrac- Live because its quality is poor (27%). In addition, some SMEs say that the professionalism of Vietnamese con- fultants isn't good enough and these Consultants lack experience, . Use of management consulting: (61134 respondents, 23 ones have made use of the management con sulting service, This is a small per centage (17.9%) but it reflects the fact that most SMBs aren't in the ‘habit of using the consulting service, Statistics also show that state-run ‘enterprises are more familiar with this service than the private ones "The survey shows that both state- rum and private entarprises have the fame reasons ta be strange to cen- sulting sorvice: they aren’ familiar With this service; consultants’ fees are rather high; and some of them never even learned of this aervica, Factors affecting their decision ‘on consultants are: prestige and ex: ‘perience of ‘consulting organizaticas land experts. d Future neod for the manage- mont consulting: (One of encouraging facts isthe in- crease in number of SMEs that thiak ‘of the use of consulting service in the future (89 out of 184 respondents) ‘Salistics also show that the bigger the size of the SME, the higher the need forthe managetent consulting, Results of discriminant of two groups (one has and one has zo, intention to use the sorvieo in the future) allow us to predict that SMEs that approve two variables ~ may things to learn from consultants and Jpusiness performance; and the need to use the management eonaulting to solve problems- belong to the posi- tive group that want to use the sere- ico, and vice versa. "The fields that most SMBs nood adviee on are: planning and business strategy (26.1%) and production and marketing management (15%). 4. Meanings and conclusions Mo deal with aifculion facing the SMEs help from the Goveroment and efforts of the SMEs are neces Sarg; and the management conse Jing serves is also vet. With information gathered frem cour survey and analy, this staly ‘auld help poiey makers and consut- ‘ints understand SMEs" operation, atitude, opinions and needs, esje: Sially their ee for the management ‘nating and woek out came ts sect thelr needs, ‘though the resulta show that the bettor part of SMBs didnt te Tere in the otoclting service and frorent accustomed tothe we of tas Tarvce to rolve their own problems, sre ean sll hope fra righer acre For thia service in Vietann, ‘The survey also. suggests that conautancies should “make. theme Selves Known, advertise their or fom, and. establish relations wih Siés "to ‘market’ cher servic. Moreover, consultants should i ve thei aklls and lnowedee, rn experience from reality and fer sign ‘counterparts, end work at Strategie appropriate to SMES