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The Financial Express

Breaking the bottlenecks to make entrepreneurs

| Updated: October 08, 2020 20:57:43


Breaking the bottlenecks to make entrepreneurs

Entrepreneurship Development (ED) is not a straight-line exercise. Whether entrepreneurs are born or made is always controversial. However, one thing is perhaps beyond any debate that an entrepreneur is endowed with some inborn qualities which make him or her more capable from others. On the other hand, an entrepreneur must undergo training to acquire knowledge, to develop skills, and to frame appropriate attitudes. These facets belong to learning process and are very necessary because of increasingly complex, competitive and changing business world. Mere training is not sufficient to make an entrepreneur. Much more is required. Are we, as makers, on the right track?

It has become emergent to accelerate the number of capable entrepreneurs for rapid expansion of investment, especially in the cottage, micro, small and medium sector. The economy is now facing the gigantic challenge of how to recover at least pre-COVID growth rate and to reduce alarming unemployment rate, particularly among the young population.

In the wake of COVID-19, we have lagged behind considerably in terms of GDP growth and there has been a substantial loss of jobs. Quick restoration of our economy and creating opportunities for adequate self-employment and jobs is largely dependent upon the momentum and the effectiveness of entrepreneurship development. What is our preparation for entrepreneurship development in view of our requirements and reality?

In the Seventh Five Year Plan (SFYP), the government set the target of job creation of 10.29 million (including 0.20 million migrants) during FY 2016 to FY2020.. Reportedly, 1.8 million jobs were created at the end of FY 2016-17 against the target of 3.9 million (i.e., about 46 per cent target met). A BIDS study reveals that full-time self employed is 5.63 per cent of educated youth, and part-time self employed is 5.79 per cent. Another study by Nakata and others (quoted in the BIDS study report) 46 percent of the young people are unemployed 3 to 4 years after graduation. Unemployed youths account for about 80 per cent in total unemployed population as per BBS' Labour Force Survey (LFS-2016-17). Obviously, most of the youths must have to look for self-employment opportunities.

Training is an important component  of entrepreneurship development programme (EDP). It is observed that different government and non-government  organisations are said to be engaged in EDP. Remarkable ones include Bangladesh Industrial Development Authority (BIDA), Ministry of Youth and Sports (MOYS), Small and Medium Enterprise Foundation (SMEF), Bangladesh Industrial Technical Assistance Centre (BITAC),Bangladesh Small and Cottage Industries Corporation (BSCIC),Micro Industries Development Assistance and Services (MIDAS) etc.

Bangladesh Development Authority (BIDA) introduced an investment project named Entrepreneurship & Skill Development Project ( ESDP ) which is based on the motto: Job Creating, not Job Seeking. ESDP aims to create skilled entrepreneurs for supplier and linkage development industries providing training to potential youths on regulatory regime and business procedure; to accomplish the Sustainable Development Goal 8 (decent work and economic growth); and to reach the target of private investment (34 per cent of GDP) according to the 7th Five Year Plan. The project period is two years ( 01-01-2019 to 31-12-2020) and is being implemented  in 64 districts. ESDP's target  is to train 24000 youths during the project period.

Directorate of Youth Development (DYD) of MOYS has a project named Transforming Unemployed Youth into Human Resources through Technical Training Project which will run upto 31-12-2021. DYD's training programmes focus on many economic activities and courses involving rearing  livestock, and fishing, mushroom cultivation, bee-cultivation, mobile servicing, sweater knitting, sewing machine operating, dress making, fashion designing, salesmanship, blanket and mat making, block printing, handicrafts, outsourcing, food catering, trades, computer courses on basics & graphics etc.

SMEF's training manly targets women entrepreneurs and it has a business manual which is of great value for new entrepreneurs. BSCIC developed an industrial profile of new business ideas from which an entrepreneur can make his or her choice of an investment project. It also provides information on industry classification (sector and subsector). BITAC mainly trains entrepreneurs on several trade courses. MIDAS trains and helps entrepreneurs to seek and explore new business opportunities.

As per BIDA's ESDP, a trainee entrepreneur has to develop an investment plan or an investment project and is provided with mentoring service from a local business professional or businessman. The type of business the trainee selects and plans to move ahead with is then accepted and recorded. Thus we get a database of trained up new entrepreneurs. It may be pointed out that a trainee's background may be: (i) the trainee has no existing business and is unemployed, (ii) the trainee has a business and is not willing to build a new business, (iii) the trainee has a business and is willing to build another business. The question that crops up: every trainee compulsorily tries to develop a business plan but how many of them out of type (i) and type (iii) emerge as real entrepreneurs? 

Some important factors need to be considered with due emphasis. First, a person intending to be an entrepreneur should have innovativeness (not to mention other qualities) but all cannot be innovative. Second, all are not of the same level of education. Third, the business size of all entrepreneurs would not be similar. However, micro, cottage and small entrepreneurs would be maximum in our socio-economic context. Fourth, entrepreneurs' own financial strength would significantly differ. Fifth, most of the entrepreneurs are unable to provide suitably valued collateral for loan. Finally, adequate data bank on potential business ideas should be generated as most of the entrepreneurs cannot be expected to develop the ideas. Compulsion will produce apparent ideas which would be totally imaginary and unreal. Are the training and development programmes designed and offered considering the above factors among others.

Offering the right investment project idea, right financing opportunity, and ensuring cheap as well as easy access to other support services are the most vital aspects of developing entrepreneurship and making entrepreneurs. BSCIC has a database on industrial classification which is very much supportive but practical data on demand and supply position of each type of business are not available. It is not possible for an entrepreneur to survey on market demand of goods and services in most cases. Apart from this, development of new goods and services is a matter of research. Outputs  from Bangladesh Council of Scientific and Industrial Research( BCSIR)  and allied organisations  should be procured and included in the database for trainee the entrepreneurs.

Numerous capable entrepreneurs are needed without delay. But do we observe synchronised efforts and programmes? Different organisations are working in isolation. A single national high-powered organisation should be established exclusively for the purpose of grooming, nurturing and utilising the entrepreneurs. Scientific research on industrial product development ought to be widely expanded and all new research organisations including market and management research should be linked to the proposed national body of entrepreneurship development. In a market economy, the government does not do any business but has to create, develop and sustain a favourable business environment. 

Haradhan Sarker, PhD, is ex-Financial Analyst, Sonali Bank & retired Professor of Management.

sarker19582018@gmail.com

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