Trainers Handbook Business Management

Transcription

1 Trainers Handbook Business Management Adapted to TsIGA Project Towards Sustainable Income Generating Activities

2 Table of Contents Table of Contents Introduction 2 3 Module 1 - Business stages & Ideas 4 Exercise The Business stages Exercise 4 Exercise Lyfe Cycle of People and Enterprises 4 Exercise Brainstorming Business Ideas 5 Module 2 - Business Environment 6 Exercise Business Screening 8 Exercise Introduction to Market 7 Exercise Exploring the Market 7 Module 3 - Business Production & Planning 8 Exercise 3.1- All it needs to create a product or service 8 Exercise Business Planning 8 Exercise 3.3. Self Assessment and Needs Inventory 9 Module 4 Managing Finance 9 Exercise Managing Money 9 Exercise Record Keeping 10 Trainers Handbook Business Management 2

3 Introduction This Trainers Handbook has been specifically developed for the TIGA team in order to facilitate Business Management training of Economic Project Holders. It comes in line with the Business Management Training Manual developed for the training of the TIGA Team during the months of June and July The Trainers Handbook is divided into different Modules, each one comprising specific instructions on different exercises. The trainers do no have to conduct the full set of exercises available in this Handbook. Conversely, according to the needs of each Economic Project Holder, the trainers can chose the more relevant Modules and respective exercises. The trainers are advised to use this Handbook along with the Business Management Training Flipcharts specifically developed for facilitating the training of TIGA s Economic Project Holders. Moreover, when needed, the trainers can always refer to the Business Management Training Manual in order to find more specific and theoretical information regarding the Modules available in this Handbook. The Handbook includes the following modules: Module 1: Business Stages & Business Ideas Module 2: Business Environment Module 3: Business Planning Module 4: Managing Finance Experimental Learning Cycle This trainer s handbook is based on an experimental learning approach 1. As a trainer you will conduct several exercises with the Economic Project holder (EPH) and then discuss outcomes, draw conclusions and allow EPHs to learn the key messages from it. You are, therefore, requested to apply the same training methodology used during the Business Management Training you received through the TIGA project in June, July Step 1: Experience by doing Step 2: Sharing What Happened Step 5: Using in your work Step 3: Analyzing what happened Step 4: Drawing Conclusions 1 Adapted from ILO. GET Ahead for Women in Enterprise. ILO Bangkok, Trainers Handbook Business Management 3

4 Training Process The specific context of the TIGA project requires, most of the times, to conduct the Business Management Training individually to each Economic Project Holder adapting it to his/her needs. In order to facilitate the training process you are advised to: Agree in advance a date for the Business Management Training with the EPH. This will allow him/her to plan her workload in advance and also to inform her/his family members. Try to provide the training to as many family members as possible who are old enough to understand the training content. This will allow a more animated training session and also the participation of all the family in the exercises. Prepare your training session in advance adapting it to the EPHs needs. Always take with you the Flipcharts and other training materials If two or more EPHs live close to each other try and provide them group training in one of the EPHs house. This will allow you to save time, have more animated sessions and allow knowledge sharing between EPHs. Sources Most of the exercises in this Trainers Handbook were adapted from the GET Ahead for Women in Enterprise Manual, developed by ILO. Module 1 Business Stages Exercise 1.1 The Life Cycle of People and Businesses EPHs become aware of the opportunities and constraints in business. Duration: 15 minutes Ask participants to describe the different stages in the life cycle of people and write it down in a notebook. Compare the stages in the life cycle of people and businesses by using relevant examples. Exercise 1.2 Business Stages To introduce different Business Stages Duration: 15 minutes Introduce the enterprise life cycle using practical examples to illustrate 5 main stages that most businesses go through (please refer to flipchart): 1. Thinking about business ideas 2. Planning and preparation 3. Launch and start-up 4. Early growth 5. Development and/or expansion Compare the life cycle of a business to the life cycle of farming (please refer to flipchart): Trainers Handbook Business Management 4

5 1. Thinking about what to plant 2. Preparing the soil 3. Planting the Seed or shoots 4. Nurturing the plants 5. Harvesting the plants Exercise 1.3 Brainstorming Business Ideas To stimulate creativity in generating business Ideas Duration: 30 minutes (if 1 EPH) 60 minutes (if several EPHs) You can do a warm-up exercise before starting this exercise. Warm-up Exercise Show participants the farmland of the Vann family on a paper Explain that the land of the family is jointly owned by father and mother Vann. They have 2 sons and 2 daughters and they want to divide the farmland equally. Ask the participants to help the parents by dividing the farmland into four equal parts of the same shape, with each part being complete. After some time invite participants to draw the answer in a paper. The solution is: Ask the participants to share how they came up with the answer and conclude as follows: - Some participants will arrive at the solution by doing a calculation, dividing the area in 12 equal parts and then assigning a section for each child. Others will grasp the solution Trainers Handbook Business Management 5

6 Brainstorming intuitively without any calculation. Thus both logical an intuitive thinking can lead to the desired result and usually the combination of both is best for business success. Explain to the participants that they should com up with as many ideas for a new business as possible. The outcome will be all of the ideas for a services or production business that they can think of. These ideas can be a valuable basis for identifying new business opportunities and new and better ways of solving problems. Use a ball or another item to turn the exercise into a livelier one. The participants throw or roll the ball to each other. The one who receives it needs to give an idea within 5 seconds. Write down all activities proposed. Introduce 3 criteria to select promising business ideas: Skills the participants have Available resources (financial, raw materials, etc) Something special about the business idea which makes it very attractive and in demand, such as products or services which are not available in the community or that have high demand. Ask participants to think about these 3 aspects and eliminate those ideas that do not comply with the above. Module 2 Business Environment Exercise 2.1 Micro-Screening of Business Ideas To fine tune with business objectives To introduce the notion of Market. Duration: 30 minutes average Recall the outcome of the previous exercise. Select those activities screened earlier. Ask participants to answer to the following questions: Skills: Do we have enough competencies to undertake this activity? Resources: WIll we be able to finance it or do we have other resources available? Demand: Will people buy our product/service? Ask participants to come up with any new criteria they might deem important to screen business ideas. Write down any new criteria suggested in a notebook. Introduce the flipchart with the Screening Tool. The business idea that receives the most smiling faces is judged the most feasible. Those criteria that receive few or no smiling faces or indifferent faces represent difficulties in the development of the business idea. Give time for the participants to re-think their selection process and ask you any doubts or make any changes to the screening exercise. Ask participants to think about all the risks they might face regarding the selected Business Idea. Help them to find solutions to respond to those risks. Trainers Handbook Business Management 6

7 Exercise 2.2 Introduction to Market Objectives: To familiarize with the concept of market Duration: 30 minutes This exercise helps participants to understand the need for exploring the market. Participants need to learn at their own pace. Try not to give any theoretical information or lectures on market. Tell them about the story of Mrs. Kimsat (same story you used during the Business Management you received please refer to Annex 1) Ask participants to list all the problems. Read the story for a second time. Ask participants to highlight the problems related to need and demand and offer. Ask participants how they would solve these problems. Ask participants to identify the main actors influencing their business. Write down the suggestions in a notebook. Show the market picture diagram (please refer to Flipchart) in order to demonstrate to the participants the different actors present in the market influencing their business. Ask the participants to select from the diagram those actors who influence their business/iga in particular. Most will conclude they depend on all the different actors mentioned in the flipchart. Tell them they are free to suggest any other actors they might think relevant for their business. Discuss with participants key terms such as purchasing power, competition, offer and demand (for detailed information refer to the Business Management Training Manual). Conclude the exercise by explaining how important it is to know the market and its constraints in order to have a successful business and to predict problems and risks. Exercise 2.3 Exploring the Market To explore the market. Learn how to conduct a mini-market study. Duration: 40 minutes Once the EPH has chosen his/her Income Generating Activity supported by the TIGA project, ask the following questions to the participants (please refer to flipchart): e 1. What are the resources you need to undertake this activity? 2. If needed, where will you purchase the resources? 3. What will be the average cost of the material you will need to produce a product or offer a service? 4. Is the product/service you will be offering needed? 5. Where will you sell it? 6. Who will be the costumers? 7. At what price you intend to sell the products/services? 8. Can potential clients afford it? 9. What are the risks you face in this activity? 10. What are the solutions you envisage to minimize those risks? 11. Who are your competitors Trainers Handbook Business Management 7

8 Explain to participants that they should be able to answer to these questions in a precise way in order to guarantee the implementation of a successful business. If participants do no know how to answer to these questions or some of these questions, ask them to take the time to do a Mini-Market Assessment and interview some competitors, potential clients, suppliers and to collect information about the prices of products to be purchased and also the selling price of the products or services they intend to provide with their IGA. Insist that it is important for them to know the market. If possible take them to the market in order to collect the information needed for running the IGA. This way you will be able to coach them on a practical exercise. Module 3 Business Production Process Exercise 3.1 All it needs to create a product or service Objectives: To identify and learn how to manage the key elements of production of a good or service To understand the different steps in a production cycle Duration: 30 minutes Introduce the flipchart on Production Cycle for service business or production business (depending on which IGA the EPH has chosen) Ask the participants to think in detail about each step they need to produce a product or service. Write down all elements identified by the participants. The participants might forget some very important parts of the production process. Please ask them to look in detail at the flipchart and think on where they will keep the stock (if needed), how will the transport materials or tools, what costs will they incur, marketing strategy and costs, etc. Once they have concluded all production steps, write down the costs of each step. If EPHs do not know the costs, you will need to help them find about these costs (Mini-Market Assessment). The sum of all production costs will then allow you to explain them that they need to sell their product or service at a price that will allow them to cover those production costs and make a profit margin. Although you do not need to lecture them on the different types of costs, do not forget to make sure they are covering the following: Start-up costs, production costs (including fixed and variable costs) and any financial costs related to the IGA. Exercise 3.2 Business Planning Promote Business Planning Duration: 15 minutes When filling the IGA Analysis form try and involve the EPH in all the process of filling in the form. Recall (or read for the first time) the story of Mrs. Kimsat. Explain that the fact that she did not plan in advance her business strategy made her lose money. Trainers Handbook Business Management 8

9 Request the EPH to tell you in detail all costs he/she will incur for starting up or enhancing the selected IGA. Ask the EPH how he/she will do this. Referring to the previous exercise request the EPH to plan the following for the start-up or enhancement of the IGA: transportation, dates (to purchase, to transform product, etc), stock, money to be made available, price of the product or service provided and marketing strategy, risks. Fill in all relevant information on the IGA analysis forms along with the EPH. This will make the EPH feel has part of the process and understand the importance of planning in advance the different production stages of a business. Exercise 3.3 Self Assessment and Needs Inventory Allow EPHs to have a better view of their business and of what they need to enhance their current IGA or what IGA (from the several IGAs EPHs have) is worth enhancing. Duration: 30 minutes This exercise is more useful for those EPHs that chose to enhance an activity. Even before choosing which IGA to enhance you are advised to conduct this exercise. Ask the participants to think about the following questions: How is my current business going? What is going well? What things could be improved in my business now? What problems do I encounter? Even if EPHs mention problems or issues that may not be directly linked to the business, but more related to family problems for example, it is important to analyze them. In rural activities business and family are closely connected and it is important to understand this. Show the flipchart on Self Assessment and Needs Inventory to the EPH and try to fill it in with the EPHs. If some EPHs are illiterate the alternative to writing their answers is to draw the answers using symbols or pictures. You can use smilies for positive or negative, you can use the + or signs, or any other drawings you are able to do. Conclude by explaining to the EPHs that they should try and strengthen the weaknesses in their business and reinforce its strengths. By realizing the strengths and weaknesses they will be more aware on how they should enhance their IGA. Module 4 Managing Finance Exercise 4.1 Managing money To understand the importance of managing money and keeping financial records Duration: 30 minutes (1 EPH) 60 minutes (several EPHs) This exercise consists of a Question & Answer discussion. You need to facilitate discussion in line with the capacity, experience and pace of the EPH and other participants in the training. Do not overload with too much information. Trainers Handbook Business Management 9

10 Ask for examples from experiences and use these to introduce the new financial concepts and terms. Ask the EPH and other people present to think of situations they face when dealing with money. Make a list of all cash transaction that occurs in one s daily life. Note key points on a flipchart or note book and use these examples when introduction new terms later in the exercise. Ask participants: What do you need money for? Participants will come up with answers that related to private experiences (buying food for the family, school, etc) and business expenses (buying raw material, stock, transportation to market). You write these answers in a flipchart or note book. Explain that it is important to make a distinction between the money you need for yourself/your family and the money you need for your business. You will notice that some EPHs do not make a clear distinction between their private and Family purse and Business Purse. Explain that it is important to know what you need the money for by giving examples they mentioned and dividing them into 2 different categories: Business and Private. Draw a small table like the one bellow (or take a photocopy with you) and fill in with the expenses mentioned by the EPHs and his/her family members: Family Purse Examples: Food, hospital, School fees, recreational expenses (TV, radio, etc), infrastructure, mobile phone re-charge. Money kept aside for personal expenses or to pay any debts related to personal expenses. Business IGA purse Examples: Money used to buy materials, supplies, equipment (or food for chickens or pigs used for the IGA) Money used for transportation related to IGA, to rent a tractor for IGA Money kept aside for future IGA expenses Money kept aside to pay any debts related to IGA Encourage participants to take a second look at the list of costs that occur or may occur in their family. What costs may occur that you have not thought yet? Remind them not to forget to predict depreciation costs (for machines) or start-up costs or unpredictable costs (thefts, waste for example some chickens die changes in demand supply due to seasonality, etc.). Ask the participants to let you know how they manage their money. Do they plan in advance, keep a record book, keep savings for unpredictable events? From TIGA experience you will notice most EPHs do not keep any record and are too poor to keep any savings. However, depending on the answers of the EPH you can adjust your training. For example, if an EPH already keeps records you do not need to insist on that matter. Discuss with the participants the importance to know what costs they will incur but also the profits they will make. Without lecturing simply tell them that to manage their finance in a successful manner it is advisable to plan their future expenses in advance. To do so they also need to predict the profits they will make. To predict the profits they have to set a price for the service or products they intend to provide with their IGA. If they manage to know these 3 aspects they can plan and manage their money more easily. Exercise 4.2 Record Keeping To promote the use of a record system Duration: 30 minutes Trainers Handbook Business Management 10

11 If the EPH does not use any record keeping system ask him/her why. The EPH will probably tell you it is because he/she is too busy, does not know how to write or count, does not know how to do it, keeps it all in his/her mind. Introduce the simple book-keeping tool. Explain it is simple to do this record-keeping exercise on a daily basis. They just need to record the money that goes out and the money that comes in and describe for what they used the money. If they don t know how to count ask them to simply register the numbers printed in the notes they receive or the notes they spend. For example, if they sold a chicken and received riel on 4 notes of 500 riel they can write: 500, 500, 500, 500. You can then later on help them to sum up these values. Although this is not a long term solution it can help you assess the IGA profits or losses based on a real record-keeping system and not only on estimations. If the EPH knows how to count it is much easier to keep a record book. They just need to register the amount spent or received. To describe the cash in or cash out, some EPHs will not be able to write so you can advise them to use simple symbols/drawings such as: To have a simple record book only for IGA cash-in and cash-out you can use one symbol for each of the 4 main components: Raw materials (if it s pigs, they can draw a pig, if it s chickens they can draw a chicken, etc) Tools or equipment (depending the tools and equipments you can agree on a simple symbol to represent this) Transport and marketing costs Labor costs Conclude by discussing with them all the advantages of record keeping such as: Know how much money goes in and goes out of business Keep control of cash (plan ahead budget) Monitor how much has been sold (sales performance) Check expenses (monitor costs) Make comparisons: cost/sales, check which products sell the best, what makes more profit Check who owes money (if keeping record of that too) Check if money got stolen or is missing Trainers Handbook Business Management 11