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Workshop on ‘Why some

Companies sustain & others
Prepared by Extra Mile.

Company Introduction
• Extra Mile is a training consultancy
• Interested in helping entities
– Provide strategic direction
– Achieve absolute success through

Presenter Introduction • Mohammad Farooque Ali – Trainer – Teacher/motivator at ACCESS Karachi. iEARN • Mariam Qureshi • TESOL Certified Trainer • Content Specialist at EM .

2 million enterprises in pakistan.Background • Of the 3. 90% are SMEs • Few SMEs grow to become medium • Fewer become large • Sustainability is very low • Purpose of the workshop is to educate about reasons for failure and solution to succeed .

Reasons for the failure of small companies .

On the societal level… • No interaction/links between business schools and business community – Irrelevant curriculum doesn’t focus on entrepreneurial mindset – Inappropriate incubation leads to indigenous business models & outdated knowledge – Need to create truly entrepreneurial institute with subvention of business community .

And on the individual level • Start the business for the wrong reasons – To make money as the sole reason – To be autonomous & independent – Spend more time with the family – Unavailability of jobs – No vision for the future – No aim of giving a worthy product .

• No strategic direction – No interest in creating value for society – Vague future picture – Insufficient planning – No worthy objectives .

Reasons why Companies Fail • Lack of Experience – Dysfunctional Management (lack of focus. planning. standards – Incorrect business model – Failure to communicate value propositions – Poor decision making – No knowledge of financial management. employee relations etc .

• Owners act as destructors – Highly over confident – Too much risk averse – Narrow focus – Conflict disinclined – Stubborn – Lose the big picture .

• Lack of Succession Plan – One man show – Nepotism – preferential treatment – Power struggles – No systems/policies .

Uncontrollable growth – Moving into unprofitable markets – Borrowing too much to facilitate the growth – Loss of original ultimate vision .• Unexpected.

• Business doesn’t know consumers – Customer is the king – No touchpoint with customers – Dialogue is the key – markets are conversations – Don’t know what the customers want – Slow in responding to customer interactions .

• Insufficient capital – No ‘cash cushion’ for operating expenses – No cash reserves for fixed capital • Not enough demand at profit-making price – Competition may have economies of scale – Idea not that much attractive .

These Reasons are mainly because of undefined ultimate vision of the future .

Other Reasons • Poor Location • Poor inventory management • Poor credit arrangement management • Poor Accounting • Personal use of business funds .

Now we turn to the Solution… but before that… we will be building concepts used in the workshop .

Titles of Concepts • Vision : A clear picture of what you desire to see/achieve in the future • Mission : An organization's purpose and primary objective to reach its desired future with a defined methodology • Strategy/Plan : Strategy is a game plan to achieve goals/aims/objectives .

• Goal/Aims/Objectives : Specific targets/milestones • Planning : the act or process of making or carrying out plans . specifically. policies. the establishment of goals. and procedures for a business .

Difference Between Vision & Mission VISION MISSION Design oriented Execution oriented Long term focus Present Focus Picture of ideal future (what we want to be) Core purpose (why do we exist) Mission is an action statement for bringing about what is envisioned Mission is what it takes to make that vision come true Vision dictates mission .

Activities to clarify the concept of Vision .

Visionary Companies focus on building the best institution that can lead them to achieve their desired future .

Period.Clock Builder…Not time teller • “I have concentrated all along on building the finest retailing company that we possibly could.” Sam Walton. Walmart Founder • Having a great idea or being a charismatic visionary leader is time telling • Building a company that can succeed is clock building . Creating a huge personal fortune was never particularly a goal of mine.

• Builders of visionary companies concentrate primarily on building an organization • They don’t – Hit a market just right with a visionary product idea – Ride the growth curve of an attractive product life cycle .

y • VC builders take an architectural approach • Concentrate on building organizational traits of visionary companies • Greatest creation is the company itself and what it stands for .

• They always aim to be the block builder rather than time teller.e. • However. • The institution i. . VCs never think of the fabulous watch.• Time telling means that the watch has been the aim right since the beginning. • They think of the hand behind the building of that watch. an organization is the only focus of VCs.